OptionsHouse Review: Read Before Opening a Brokerage Account

This article reviews OptionsHouse, an award-winning brokerage that provides a trading platform for bonds, mutual funds, options and stocks.

Company

OptionsHouse LLC was formed in 2005 by PEAK6 Investments, LP.  PEAK6 Investments, LP was founded in 1997 and has its headquarters on the trading floor of the original Chicago Board of Trade.

Broking Platform Overview

OptionsHouse makes extensive use of advanced web technology to enable its customers take maximum advantage of an online trading platform that is rich in software-based trading tools. Trading is offered via browser, on mobiles and tablets such as the iPad.

Targeted Clientele

The services are targeted at “savvy” customers, though the company emphasizes that it enables both retail and institutional options traders and investors to make the transition from basic trading to a more professional level.

It is obvious, however, that the target customer is really the serious option trader who possesses somewhat better technical and financial acumen compared to the average retail trader.

What you can trade

The following instruments may be traded on OptionsHouse:

  • Mutual funds
  • Bonds
  • Options
  • Stocks, including OTCBB

The following instruments are not offered for trade here:

  • Futures
  • Commodities
  • Foreign ADRs
  • Forex
  • Equities listed on international exchanges

Virtual trading

This is an interesting feature offered to both prospective and current customers. A live but simulated trading environment allows the customer to enter virtual orders and test the impact of his paper trades on theoretical capital, which is $5,000. Customers may test their trade ideas in this feature before venturing into real money trading.

Features that enhance ease of use

  • Visually appealing, streaming charts
  • Live and immediate news and analysis
  • Highlighted executable fields available across the platform – trade from a large number of places that display the bid/ask. This reduces the time and number of clicks required to place a trade
  • Browser agnostic – works on any browser and no software requires to be downloaded or installed
  • Advanced order types and complex trades
  • After hours trading facility provided
  • A wealth of educational resources are made available as webinars
  • A Research Center for stocks provides analysts opinions, earnings information, data on ETFs and a calendar of market events
  • Dependable and quick-to-respond customer service
  • Tools such as the Trade Generator, Stock Screener and Risk Viewer help explore new ideas and structure trading strategies and to give you intuitive assessments of likely profit and loss

Screen Shots of the Browser based platform

Here are a few screen shots that should help provide a look-and-feel of the platform.

The Main Screen

OptionsHouse Online Stock Broker Review

Order Ticket

<OptionsHouse Online Stock Broker Review

 
 

Screenshot of the iPad platform

OptionsHouse Online Stock Broker Review

Screenshot of the iPhone platform

OptionsHouse Online Stock Broker Review

Pricing

The pricing structure is simple and extremely competitive.

Stocks

Stocks trades are just $3.95 each, a flat rate.

Options

Customers can select from two pricing options. Either $8.50 + $0.15 per contract or just $5 for 5 contracts with $1/contract over 5.

High volume clients would find the first option more economical.

There are no extra charges for broker-assisted trades. Margin interest varies from 1.5% to 4% depending upon the balance maintained by the customer. The broker guarantees “there are no hidden fees, maintenance costs, balance minimums or trading minimums at OptionsHouse. We do pass on some fees to help offset the cost of certain transactions.” On looking at this list of charges, we found that OTCBB stocks attract an additional charge – for stocks priced $2 or less that are not options eligible, $0.005 charges would be added per share for the entire order. So penny stock traders need to watch out for the fine print here.

Current Promotions

ACAT Transfer Rebate of up to $100 is offered to ease switching to OptionsHouse from another broker. A credit of $25 is offered for customers opening an account with a funding wire transfer. If the funding is more than $5,000, OptionsHouse offers you 100 free trades.

Regulation

The broker is a member of the FINRA and SIPC.

Awards

Barron’s 2012 review rated OptionsHouse as one of the “Best for Options Traders” – the fourth straight such award from Barron’s.

Barron’s rated the mobile platform of OptionsHouse as the highest rated amongst all brokers – #1 in the mobile category.

Conclusion

For the features on offer, and considering the competitive pricing, this brokerage certainly offers value for money.

 
 

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