As an options trader, you need to be more picky than a general stock trader about which broker you choose. Comparing brokers on fees alone is not sufficient to make a smart decision for the long run. After all, your money is going to be tied up for quite a while so you want to make sure you are with the best broker across the board when factoring in tools, execution, customer support as well as fees.
When options trading started to become popular after the tech-bubble and bust, two options trading platforms dominated: OptionsXpress and thinkorswim. Over the years, a host of other platforms competed to drive down cost and improve the range of services available. But the two early leaders grew so popular that both were ultimately acquired. TD Ameritrade purchased thinkorswim and Schwab bought OptionsXpress.
These days the playing field has leveled. New brokers like tastyworks have come along to drive costs down even further. They don’t even charge closing commissions costs, though standard exchange fees do apply.
TradeKing/Ally and most if not all the major stock brokers now have options trading platforms that provide the execution, accuracy and customer support you might expect from top tier brokers.
In spite of the competition from other online trading platforms that feature options trading, including TradeStation, thinkorswim remains at the top of the heap because of the range of tools and services it provides. They may not be the lowest when it comes to commissions costs but their tools are second to none.
At thinkorswim you can get access to over 300 technical chart studies on feature rich charts. It’s even possible to customize and manipulate your own charts and technical indicators using an embedded programmable language. If you want to back-test strategies or examine options risk graphs, you can do so simply at thinkorswim too.
In fact, the greatest problem thinkorswim has is it can feel overwhelming to beginners who are not very familiar with where to find the analyzers or virtual trading platform or scanners.
If you are looking for a simpler platform, OptionsXpress is hard to beat because the interface is slightly more intuitive and you don’t need to download it to a desktop as you do with thinkorswim. With OptionsXpress, the web-based interface means you can access your trades anywhere when you are online.
TradeStation is well known for having extensive capabilities too and are lightning quick on execution. The general feedback from options traders these days is that you can probably use any one of these options trading platforms and fair well but if you are looking for the best one, few would argue that thinkorswim gets the top prize.
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