OptionsXpress Review and Evaluation
OptionsXpress has consistently been one of the more popular online brokers for options traders for many years. In 2011 it was bought out by Charles Schwab, to complement their financial and banking services and it continues to impress. It offers a variety of useful tools and is well known for regularly improving its offerings.
This broker strives for innovation and yet remains committed to providing a user friendly experience. It isn't difficult to understand why it's so popular with options traders. Given its tendency for innovation, and the fact that it's now under the corporate umbrella of Charles Schwab, it's reasonable to expect that OptionsXpress will only get better in the future too. We have provided a detailed review of OptionsXpress below to help you find out more about what is available at this broker. Key aspects such as trading costs, tools, features, and customer support are all covered.
If you are looking to minimize your trading costs then OptionsXpress is not the best broker for you. However, if you are prepared to pay a little bit more to access a powerful and useful range of trading tools, then it's definitely worth considering. In our opinion what this broker has to offer justifies the cost.
Commissions, Fees & Minimum Deposit
There are two commission tiers at OptionsXpress. If you execute fewer than 35 options trades during a quarter, then you pay $1.50 for each contract, with a minimum fee per trade of $14.95. If you execute more than 35 options trades during a quarter, then you qualify for the “Active Trader” rate. The cost per contract is reduced to $1.25 and the minimum fee is lowered to $12.95.
It's fair to say that OptionsXpress isn't cheap. If you trade in very small volumes, then the $14.95 minimum fee could prove to be expensive. Equally if you trade in very high volumes then the relatively high fee per contract will also prove costly. Medium volume traders probably get the best value, but there are still cheaper alternatives out there.
You shouldn't necessarily rule this broker out based on these costs alone, because it does have a lot to offer. It should also be noted that there's no charge at all for exercising or assigning options, something that most brokers will impose a fee for. Broker assisted trades are also available for the relatively cheap fee of $8.95.
OptionsXpress doesn't impose a minimum deposit for opening an account.
Trading Platform, Tools & Features
The trading platform at OptionsXpress, called Xtend, is available within your web browser or as a downloadable software application. Most users seem to prefer the web based option and it's more user friendly. It also appears to be more responsive and run more quickly.
Beginners and experienced traders alike should appreciate the trading platform, in terms of both ease of use and functionality. It features some of the best trading tools of any online broker and it's very useful in helping you find and assess opportunities and execute your chosen trades.
OptionsXpress provides a number of innovative tools that you won’t find anywhere else. “Walk Limit”, for example, helps to prevent the hassle of having to adjust spread orders by automatically updating your order to try and achieve favorable prices. There is also the “Idea Hub” which assists in quickly and easily finding ideas for potential trades.
The options chains tool allows you to view quotes, updated in real time, for each leg of a wide range of different options strategies. You can see the relevant intrinsic value and time value of options, and putting together complex spreads and executing them is very straightforward. The “All In One Trade Ticket” is widely regarded as the best order placement tool in the industry. “StrategyScan” will help you to identify a trading strategy that suits your personal goals and attitude to risk.
Overall there is a strong element of getting what you pay for as the higher commissions charged by OptionsXpress really are justified by the quality of the trading platform and its associated tools. The platform is also mobile compatible too, which is useful for those wishing to trade using a smartphone or other mobile device.
Research & Analysis
At OptionsXpress you will find pretty much all the research tools you need to make informed and educated trading decisions. You can get basic overviews of the information you wish to see and you can drill down into the detail if you want to. You can create customized watch lists and alerts with relative ease, and view the latest market news.
The tools for analysis are good too. There are several patterning tools and screeners that will allow you to search through potential trades and select those that appeal to you. The charting software features a range of technical indicators and there is also the “Trade and Probability Calculator” which can be used to evaluate opportunities before executing an order.
The customer service at OptionsXpress is very strong. You can contact support staff via telephone, email or live chat and can expect a helpful response.. Response via email could be a little quicker, but there is no real cause for complaint.
OptionsXpress does offer 24 hour support, but currently this is only available to futures traders. If they extended to this to options traders as well then they would score even higher for customer service.