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Best Options Trading Platforms for 2021

Blain Reinkensmeyer

The StockBrokers.com best online brokers 2021 review (11th annual) took three months to complete and produced over 40,000 words of research. Here's how we tested.

Options trades offer online brokers much higher profit margins than stock trades, and, as a result, competition is fierce in attracting these clients. This type of market atmosphere is great for traders because healthy competition drives product innovation. Every broker strives to be the best platform for options trading.

For our 2021 Review, we tested and scored 11 different trading platforms. Alongside platform usability, our testing focused on options chains (e.g., optional views, total optional columns, streaming data quality, total greeks offered), options analysis (e.g., P&L charts, calculators), and option position management (e.g., if greeks stream, rolling functionality, grouping availability, and advanced position analysis). With most brokers offering similar pricing, trade cost was not an influencing factor in our scoring.


Best Options Trading Platforms 2021

StockBrokers.com 2021 Review

Here are the best options trading platforms, based on over 30 variables.

ETRADE logo

Best overall options trading platform - Open Account
Limited Time Offer: Open and fund an E*TRADE account & get $600 or more w/ code: BONUS21 Advertisement

For beginner, casual, and active options traders, Power E*TRADE offers the perfect blend of usability, excellent tools (screening via StrategySEEK, scanning via LiveAction), and seamless position management (custom grouping, real-time streaming greeks, risk analysis, and more). In 2021, E*TRADE is once again our top pick for options trading. Read full review

TradeStation logo

Best desktop options platform - Open Account
Promo Offer: Commission-Free Trades on Stocks, ETFs & Options Trades Advertisement

As a trading technology leader, TradeStation shines. Options trading is a breeze using OptionStation Pro, a built-in tool within the TradeStation desktop platform designed for streamlined trading and robust analysis. Options tool capabilities include custom grouping for current positions, streaming real-time greeks, and advanced position analysis, to name a few. Read full review

TD Ameritrade logo

Best options trading tools - Open Account
Exclusive Offer: Get up to $375 and trade commission-free with TD Ameritrade.

TD Ameritrade is number one for trading platforms and tools for the 10th consecutive year, thanks to desktop-based thinkorswim, which is also terrific on mobile. Whether options trading, day trading, or futures trading, TD Ameritrade is a winner. This is especially true for beginners, who have access to the thinkMoney educational magazine, hundreds of educational videos, progress tracking, and quizzes. Read full review

Charles Schwab logo

Unique order type for trading options

Schwab's flagship downloadable trading platform, StreetSmart Edge, provides most of the bells and whistles options traders and day traders need to succeed. For options traders, Schwab's All-in-One Trade Ticket, alongside its proprietary order type, Walk Limit, are both excellent. Read full review

Interactive Brokers logo

Best for professional options traders - Open Account
Exclusive Offer: New clients that open an account today receive a special margin rate.

Trading tools within the Trader Workstation (TWS) platform are built for professional options traders. From algorithmic trading to Options Strategy Lab, Volatility Lab, Risk Navigator, Market Scanner, Strategy Builder, and Portfolio Builder, Interactive Brokers is popular among hedge funds, and for a good reason. The caveat to keep in mind is that TWS requires a $110,000 deposit for margin trading and is not beginner-friendly. Read full review


Is Robinhood good for options trading?

While Robinhood is easy to use, it lacks the trading and research tools that the best options trading platforms offer. In addition to a limited selection of options education articles, Robinhood also does not offer paper trading, so there is no way to practice trading options with fake money. Thus, for beginner options traders, we do not recommend Robinhood.


Where can I practice options trading?

To practice options trading, choose an options trading platform that offers a free paper trading account. With paper trading, virtual money is used to place options trades in a simulated environment. E*TRADE, TD Ameritrade, TradeStation, and Interactive Brokers all offer paper trading for options.


Options Trading Platforms Tools Comparison

Here's a summary of the primary options trading features offered by the best options trading brokers. At the end of the guide, we have a summary of each feature and its definition.

Feature E*TRADE
Open Account
TradeStation
Open Account
TD Ameritrade
Open Account
Charles Schwab Interactive Brokers
Open Account
Option Chains - Streaming Yes Yes Yes Yes Yes
Option Chains - Total Columns 30 32 35 44 37
Option Chains - Greeks 5 5 5 5 4
Option Chains - Quick Analysis Yes Yes Yes Yes Yes
Option Analysis - P&L Charts Yes Yes Yes Yes Yes
Option Probability Analysis Yes Yes Yes Yes Yes
Option Probability Analysis Adv Yes Yes Yes Yes Yes
Option Positions - Greeks Yes Yes Yes Yes Yes
Option Positions - Adv Analysis Yes Yes Yes Yes Yes
Option Positions - Rolling Yes Yes Yes Yes Yes
Option Positions - Grouping Yes Yes Yes Yes Yes


Options Trading Platforms Pricing Comparison

Here's a summary of the pricing for the best options trading brokers.

Feature E*TRADE
Open Account
TradeStation
Open Account
TD Ameritrade
Open Account
Charles Schwab Interactive Brokers
Open Account
Minimum Deposit $0.00 $0.00 $0.00 $0.00 $0.00
Stock Trades $0.00 $0.00 $0.00 $0.00 $0.00
ETF Trade Fee $0.00 $0.00 $0.00 $0.00 $0.00
Mutual Fund Trade Fee $19.99 $14.95 $49.99 $49.95 $14.95
Options (Base Fee) $0.00 $0.00 $0.00 $0.00 $0.00
Options (Per Contract) $0.65 $0.50 $0.65 $0.65 $0.65
Futures (Per Contract) $1.50 $1.50 $2.25 $1.50 $0.85
Broker Assisted Trades Fee $25.00 $50.00 $44.99 $25.00 $30.00


Best Options Trading Platform Tools

Platform wise, web-based Power E*TRADE offers all the tools an options trader could want, and displays them in magnificent form. Attention to detail, such as automatic spread groupings, effortless scanning through StrategySEEK, and easy-to-understand risk/reward data through tradeLAB, make Power E*TRADE a truly unique experience.

Power E*TRADE options trading platform Snapshot Analysis tool
Power E*TRADE options trading platform Snapshot Analysis tool.

Power E*TRADE aside, TD Ameritrade's thinkorswim platform and TradeStation are also excellent platforms. Strategy Roller from thinkorswim enables clients to create custom rules and roll their existing options positions automatically. The number of settings and depth of customization available is impressive, and something we have come to expect from thinkorswim.

td ameritrade thinkorswim options trade profit loss analysis
TD Ameritrade thinkorswim options trade profit loss analysis.

Meanwhile, TradeStation's OptionsStation tool makes analyzing potential trades a breeze, and even goes as far as including 3D P&L charts. Investors note, however: Popcorn and 3D glasses are not required, and while visually appealing, we did not see any distinct advantage over a traditional 2D P&L chart. 3D charts aside, no question, TradeStation earns its spot as one of the best platforms for options trading in 2021.

Best options trading platform TradeStation OptionStation Pro
Best options trading platform TradeStation OptionStation Pro.

If unique features and functionality matter to you, Charles Schwab offers the “Walk Limit” order type, which will "walk" your order to try to get the most favorable price within the National Best Bid or Offer (NBBO). Schwab also offers Idea Hub, which uses predefined scans to filter down options trade ideas.

Charles Schwab options trading platform idea hub tool
Charles Schwab options trading platform idea hub tool.

For professionals, Interactive Brokers takes the crown as the best options platform. At Interactive Brokers, there is no base charge, and the per-contract rate is just $.70. Additional savings are also realized through more frequent trading. That said, Interactive Brokers requires a $110,000 minimum deposit for margin accounts. Lastly, its trading platform, Trader Workstation, is the most challenging platform to learn out of all the brokers we tested for our 2021 review.

Interactive Brokers Trader Workstation TWS options trade analysis
Interactive Brokers Trader Workstation TWS options trade analysis.

There's a healthy variety of reputable brokers to choose from in the world of options trading. At a minimum, investors should expect their broker to include scanning, P&L analysis, risk analysis, and easy-order management. Position management functionality and tying the experience together is where platforms such as Power E*TRADE and thinkorswim by TD Ameritrade distinguish themselves.


Which trading platform is best for options?

The best trading platform for options trading in 2021 is Power E*TRADE. For beginners, the Power E*TRADE platform offers the right balance of ease of use, education, and intuitive design. For example, using the Snapshot Analysis tool, not only is risk and reward translated with smiley faces for each options trade, but key market events to look out for are also listed alongside a P&L chart. It's a work of art.


What is a call option?

In its most basic form, a call option is used by investors who seek to place a bet that a stock will go up in price. Buying a call option contract gives the owner the right (but not the obligation) to purchase shares at a pre-specified price for a pre-determined length of time. As the stock price goes up, so does the value of each option contract the investor owns. Conversely, if the stock price goes down, so does the value of the call option. Each contract represents 100 shares of stock.


What is a put option?

In its most basic form, a put option is used by investors who seek to place a bet that a stock (or other security such as an ETF, commodity, or index) will go down in price. Buying a put option gives the owner the right (but not the obligation) to sell shares of stock at a pre-specified price (strike price) before a preset date (expiration). The further the stock falls below the strike price, the more valuable each contract becomes. Alternatively, an increase in the stock price will decrease the value of the put option.


How much money do I need to trade options?

Each online broker requires a different minimum deposit to trade options. For most brokerages, the minimum deposit required is less than $1,000 for level 1 options trading. Certain options strategies, such as net-credit spreads, can require as much as $10,000 available in your account and are considered level 2 or level 3. To apply for options trading approval, investors fill out a short questionnaire within their brokerage account.


Is options trading risky?

Yes. Options trading is a form of leveraged investing and thus is inherently risky. Any time an investor is using leverage to trade, they are taking on additional risk. Many times, this risk is unforeseen and not easily quantified.

On the most basic level, investors who buy a call or put option are only risking the money they invested in the contract. However, when selling a call or put, if the trade isn’t protected (also known as going naked), the investor is taking on potentially unlimited risk.

As a protective measure, there are five options approval levels, and each one requires an application through the online broker platform to unlock. The riskier the options strategy, the higher the approval needed to trade it.


Options trading platform features summary

All of the best brokers for options trading offer the following features.

Feature Definition
Has Education - Options Provides a minimum of 10 educational pieces (articles, videos, archived webinars, or similar) with the primary subject being options. All content must be easily found within the website's Learning Center. Platform tutorials, FAQs, etc do NOT count.
Option Chains - Streaming Real-time Option chains with streaming real-time data.
Option Chains - Greeks Viewable When viewing an option chain, the total number of greeks that are available to be viewed as optional columns. Greeks = delta, gamma, theta, vega, rho.
Option Chains - Quick Analysis The ability to jump straight from the option chain to a P&L chart or probability chart for deeper analysis. Viewing a summary P&L within the chain itself also qualifies.
Option Analysis - P&L Charts When analyzing a theoretical option trade, a P&L chart is available.
Option Analysis - Probability Analysis A basic probability calculator.
Option Analysis - Probability Analysis Adv A tool to analyze a hypothetical option position. Displays a probability histogram / chart with optional customizations.
Option Positions - Greeks Viewable View at least two different greeks for a currently open option position.
Option Positions - Greeks Viewable Streaming View at least two different greeks for a currently open option position and have their values stream with real-time data.
Option Positions - Advanced Analysis Ability to analyze an active option position and change at least two of the three following conditions - date, stock price, volatility - and assess what happens to the value of the position.
Option Positions - Rolling Ability to pre-populate a trade ticket and seamlessly roll an option position to the next relative expiration.
Option Positions - Strategy Grouping Ability to group current option positions by the underlying strategy: covered call, vertical, etc. Can be done manually by user or automatically by the platform.
Level 2 Quotes - Options Level 2 options quotes available.
Screener - Options Offers a options screener. Commonly referred to as a spread creation tool or similar.


Summary

To recap, here are the best options trading platforms.

Best trading platform for beginners 2021


Read Next

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Methodology

For the StockBrokers.com 11th annual best trading platforms review published in January 2021, a total of 2,816 data points were collected over three months and used to score brokers. This makes StockBrokers.com home to the largest independent database on the web covering the online broker industry.

Participation is required to be included. Each broker completed an in-depth data profile and offered executive time (live in person or over the web) for an annual update meeting. Our rigorous data validation process yields an error rate of less than .001% each year, providing site visitors quality data they can trust. Learn more about how we test.


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Blain Reinkensmeyer

About the author: As Head of Research at StockBrokers.com, Blain Reinkensmeyer has 20 years of trading experience with over 1,000 trades placed during that time. Referenced as a leading expert on the US online brokerage industry, Blain has been quoted in the Wall Street Journal, The New York Times, the Chicago Tribune, and Fast Company, among others.


All pricing data was obtained from a published web site as of 01/19/2021 and is believed to be accurate, but is not guaranteed. 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.

TD Ameritrade, Inc. and StockBrokers.com are separate, unaffiliated companies and are not responsible for each other’s services and products. View terms.

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