Published by Blain Reinkensmeyer
On Friday, February 5th, 2016
The uniting of OptionsHouse and TradeMONSTER is a fantastic marriage for current and new clients. The tradeMONSTER platform is top notch and commission rates are extremely competitive.
Clean commissions schedule; fantastic tools for option trading; easy-to-use platform that’s great for beginners and seasoned veterans alike.
No trade alert functionality on mobile; few studies available for charting; weak education offering.
In May 2014, it was announced that OptionsHouse and tradeMONSTER would be coming together under one roof. OptionsHouse was best known for its highly competitive commission rates, while tradeMONSTER was known for its terrific web-based options trading platform.
As details of the two brokers joining forces trickled out throughout the end of 2014 and early 2015, it became clear the combined brand would maintain these strengths. As we witness the merged companies operating under the OptionsHouse name with tradeMONSTER being the platform, we couldn’t be more excited for OptionsHouse’s future in 2015 and beyond.
Commissions & Fees
Under the new combined entity, all stock trades are a flat rate of $4.95 per trade and options trades are just $4.95 + $.50 per contract. This flat-rate commission structure is significantly less expensive than all the big brokers, such as TD Ameritrade, ETRADE, Scottrade, etc.
In fact, when you break these rates down against the entire industry, OptionsHouse finishes #2 overall, behind only Interactive Brokers. For equities and options traders this is a seriously competitive commission structure that cannot be overlooked. What we also deeply appreciate is that OptionsHouse’s structure is clean cut with little or no gimmicks or special-case scenarios that can ramp up costs in a hurry. No platform fees or data fees either – the rates are all inclusive.
Lastly, it should be noted that at the time of this Review’s publication, some of OptionsHouse’s miscellaneous fees still needed finalizing. These fees included wire fees, paper statement fees, and the like. As soon as this data becomes available, we will be updating these miscellaneous commission notes accordingly. For now, however, we are displaying the rates OptionsHouse used prior to the merger.
Platforms & Tools, Research
When it comes to powerful platforms for trading options, tradeMONSTER competes with the best in the industry. Built as a web-based platform, tradeMONSTER innovates and delivers speed, quality, ease of use, and the tools needed for options traders to succeed. For these reasons, it is no surprise OptionsHouse decided to shut down its own platform, OptionsHouse 2.0, and switch to tradeMONSTER entirely.
TradeMONSTER offers both virtual trading and regular trading. For newer investors, there isn't a better platform on which to learn how to trade. Pulling up quotes is a breeze, and tradeMONSTER simplifies the user experience by displaying only three menu options: Trading, Markets, and Account. Hovering over these menu options will reveal their sub-menus, all of which are also clear and well organized.
On the right sidebar of the Quote screen is tradeMONSTER’s take on Research, including the tradeMONSTER Relative Ranking, alongside a breakdown of company information and fundamentals. Instead of providing everything under the sun, the broker offers its own Fundamental Report Cards for each stock that, in most cases, includes letter-relative ratings. While I applaud the tradeMONSTER platform team for thinking outside the box, I found the data difficult to interpret, especially after using the research areas of the big full-service brokers, such as Fidelity, Charles Schwab, TD Ameritrade, and ETRADE.
When it comes to tradeMONSTER’s streaming charts, the functionality is intuitive and easy to modify once you get the hang of the menu options. Also on the plus side, it is easy to place a trade from the chart by simply double clicking anywhere on the chart to have an order pre-populated. The one major drawback to the charting is with the technical depth: the number of studies (34) is limiting and the customizations available for each are basic. Back to the plus side, one of our favorite features is being able to view our past buys and sells right on the chart.
Moving onto options capabilities, tradeMONSTER really begins to stand out. The option chain screen displays a fully customizable streaming real-time option chain with 30 different optional columns and every greek.
Once you find an option of interest, clicking it pops open tradeMONSTER’s summary window, which includes key metrics alongside different quick links for further analysis. Click Analyze and the tradeLAB Snapshot Analysis pops open. Not only is Risk/Reward completely broken down with simple similes to translate the pros and cons, but key events to watch out for are displayed alongside a P&L chart. It’s a work of art.
If that isn’t good enough, tradeMONSTER then provides a Spectral Analysis, which includes all data needed to make an informed decision. My favorite feature on this tab is Risk Metrics, which displays the option greeks. Since not all investors understand the greeks, tradeMONSTER has a simple pull-down menu to change from "Greek" to "English," making the data user-friendly for new investors. Awesome.
Once you have finished analyzing, you can quickly import the data into a fresh trade ticket, use the trade calculator to find the right position size, add optional notes, and then place the trade. (Note: This intuitiveness with design and UI continues beyond researching and placing trades. All live positions are completely customizable. TradeMONSTER automatically groups options into spreads for you, then allows you to completely regroup them and customize them to your liking using a simple drag-and-drop interface.)
Even with all these capabilities, the highlight for options remains the strategySEEK tool which is where you will find the platform’s option screener. strategySEEK is hands down the best options scanner in the industry. First, you forecast the price at which you think the stock might end up down the road. Next, you drag and drop to set and order your priorities for the trade: Profit, Return, Probability, and Safety. Lastly, you click “Show Strategies” for a list of the best possible matches. From here, you can create an order and place the trade, analyze the trade (see above), or adjust the scanner and rerun.
It isn’t just the interface that makes strategySEEK impressive, it’s also the data and the behind-the- scenes calculations taking place to power the tool’s recommendations. The tradeMONSTER platform calculates EVERY possibility, millions of them, using a plethora of data, and displays results in milliseconds. This attention to detail is also seen throughout the rest of the platform.
All in all, the arsenal of tools available to options traders is truly impressive. TradeMONSTER has a clear understanding of what options traders want, and delivers it in stunning fashion. And, while the platform is not built for chart enthusiasts, there is still a variety of tools equity traders can appreciate like the LiveAction scanner.
So is tradeMONSTER the best platform available today? When we looked at our 52 variables in the Platforms & Tools category, tradeMONSTER did not finish at the top. The platform is missing additional pieces, such as advanced trade alerts, depth of optional columns for its watch lists, cost basis customization functionality for open orders, and more. That said, when it comes to browser-based platforms, options trading, and ease of use for new investors, tradeMONSTER is king.
With the combined company, the tradeMONSTER mobile app was easily the superior product, and thus this is what OptionsHouse is providing clients moving forward.
In 2013, tradeMONSTER released a brand-new mobile apps suite. Taking a completely different direction from the normal native development route, tradeMONSTER opted for a full HTML 5 design in a native wrapper. In summary, it took more than a year to build and is at the forefront of development standards.
While we found the new app to be a little sluggish after its release, we’ve seen positive improvements since, especially throughout 2014. During testing for our 2015 Review, we found no delays. Logging in and jumping between tools revealed no speed differences against a fully native application.
Looking at features, on the pros side, the app has a lot of the strong core functionality traders desire: real-time streaming quotes, synced watch lists, the ability to place basic and complex options orders alongside a variety of equity order types, and more. The broker has also tied in some creative elements, such as designing a customizable home screen to include visual pricing.
On the cons side, the app’s biggest drawback is its lack of stock alerts functionality. Want to receive a push notification alert when Apple (AAPL) stock hits new highs? Unfortunately, this is not currently possible. Also, the depth of charting is slightly below the industry average, as only 13 technical studies are supported.
All data considered, the app has a very solid foundation and is built with the future in mind. OptionsHouse, through its tradeMONSTER app, has proven that HTML 5 in a native wrapper can match the speeds of a full native experience and provide deep functionality.
Since the transition was still in progress during our customer-service testing, we tested both OptionsHouse’s and TradeMONSTER’s customer support independently. We then merged all data to derive official scores for the combined entity. On the whole, the broker did ok, but certainly was in the lower half of the pack. We suspect the merger played a huge role in this, and, overall, we feel a fair baseline for the new combined company will come during our testing for the 2016 Review.
The combination of OptionsHouse and tradeMONSTER is a huge win for clients. Highly competitive commission rates, alongside a fantastic trading platform, make for a very compelling offering.
The broker still has some work to do as far as hashing out its customer service, helping OptionsHouse become acquainted with the tradeMONSTER platform, and updating its website to reflect the revised brand image. That said, we are excited to see how everything rolls together in 2015 and couldn’t be more bullish about OptionsHouse’s future.
The content portion of this Review was completed on February 17th, 2015.
Blain has been involved in the markets for over 13 years, heading StockBrokers.com equity broker research and reviews. His personal blog, StockTrader.com, provides to-the-point daily market recaps to over 17,000 subscribers.
OptionsHouse is an online broker with fairly straight forward commission offerings.
Stock Trades - OptionsHouse's flat rate stock trade commissions of $4.95 are among the lowest of any current online broker. For stocks under $1 add $.0005 per share.
The $4.95 rate applies to any sized order up to 50,000 shares. If over 50,000 shares, the order will be split into two or more with an additional $4.95 commission charged for each 50,000 shares.
Options Trades - $4.95 + $.50 per contract. Exercises and assignments receive a flat rate commission of $4.95. OptionsHouse also offers a very unique dime buyback program, allowing users the ability to buy back any short options for no commission when they are priced $.10 or less.
If trading options in SPX, VIX, RUT, and OEX there is an additional fee of $0.18 - $0.45 per contract to offset exchange fees.
Other Investment Types - Mutual fund trades are $20 per trade. Bond trades are $25 + $1 per bond. OptionsHouse also offers futures trading.
All pricing data was obtained from a published web site as of 5/01/2015 and is believed to be accurate, but is not guaranteed. The StockBrokers.com staff is constantly working with its online broker representatives to obtain the latest pricing data. If you believe any data listed above is inaccurate, please contact us using the link at the top of this page. For stock trade rates, advertised pricing is for a standard order size of 500 shares of stock priced at $30 per share. For options orders, an options regulatory fee per contract may apply.