Best broker for options trading etfs

Best broker for options trading etfs Options: $9.99 + $0.75contract. Options: $5.00 + $0.65contract. Options: $9.99 + $0.75contract. You know what stocks are. You know what bonds are. But you may not be familiar with the popular and relatively new investment vehicles known as ETFs. ETF stands for ‘Exchange Traded Fund’ which may sound complicated, but is actually fairly simple. ETFs are investment funds that trade on stock exchanges and have symbols like ordinary stocks. This allows the average investor like you and me diversify our portfolio without dealing with management fees and minimum deposits. An ETF can hold stocks, commodities, or bonds. The very first ETF was born in 1989 and simply tracked the S&P 500 index. For many years, ETFs generally served as a way for investors to buy into indexes. ETFs really exploded onto the investment scene in 2008 when the US Securities and Exchange Commission authorized the creation of actively managed ETFs. This change in regulation allowed for thousands of new ETFs that tracked the performance of specific commodities like gold, silver, and oil. It also allowed for ETFs that track the performance of particular sectors like telecoms or financials.

There are now well over 1,500 ETFs tracking everything from Australian small-cap stocks to platinum. Diversification on the Cheap. ETFs are particularly attractive because they offer an easy way for investors to diversify their exposure. Interested in oil exploration stocks, but not sure which oil exploration company to invest in? Just buy PowerShares Dynamic Energy Exploration & Production (PXE) which holds Hess Corporation, Occidental Petroleum, Anadarko Petroleum, and many other companies in the same sector. Unlike Mutual Funds, Hedge Funds, or other managed funds, ETFs have very low expense ratios and no minimum investment requirements. Since they are traded on stock exchanges, they also tend to be very liquid and transparent. Besides low management fees, ETFs are also tax efficient. ETF funds don’t have to sell securities to meet investor redemption. ETF Trading For Advanced Investors. For the more advanced trader, its worth mentioning that ETFs have all the features of ordinary stock. This means they can be sold short, and that they support options trading. Savvy investors can buy or write call and put options for ETFs. Even players who don’t want to sell short or deal with options can place leveraged bets for or against entire countries, sectors, or commodities using ETFs.

As an example, the ETF ProShares UltrShort Silver (ZSL) replicates twice the inverse daily performance of silver bullion. Many new ETF instruments are released every year. The level of diversity and flexibility ETFs offer make them attractive options for long-term investors, and short-term traders. Trading ETFs has been growing in popularity over the last few decades with one of the most popular ETF by volume being the SPDR S&P 500 ETF (SPY) which tracks the performance of the S&P 500. Let’s take a quick look at the benefits ETFs offer:Low Cost – Unlike other managed funds, ETFs don’t have to buy or sell securities to accommodate investor purchases and sales. They don’t have marketing, distribution, or accounting expenses to worry about either This means. ETFs have much lower management fees than traditional managed investment trusts. The underlying assets of an ETF have low turn over which means lower capital gains taxes. Flexibility – ETFs can be bought and sold on stock exchanges at any time during the trading day. Many large ETFs have large volumes, making them very liquid investments. ETFs can also be purchased on margin, sold short, and support options trading.

Diversity – ETFs allow the average investor a level of diversification previously unavailable to the general public. There are thousands of ETFs that allow investors to buy into baskets of commodities, specific sectors, international markets, bonds, and even to bet against those same markets. Transparency – Both indexed funds and actively managed ETFs have transparent portfolios that allow potential investors to research their holdings. Best broker for options trading etfs Our servers have seen too many requests from you recently. If you feel this block is in error, please contact us using the form below. In order to control abuse and prevent automated scrapers, we limit the rate at which you can request content from Graphiq. Your browsing activity seems to have activated our rate limiter, which may be the result of your computer sending too many requests in a short timeframe, or other signs that may appear to our servers as an automated scraper. Crawling and scraping are not permitted by our Terms and Conditions. ETF Choices, Low Trading Fees Make Best Brokers A Hit. M ost ETF investors worry about stock market turmoil and uncertainty. But as the best online stock brokers know, others live for volatility. Of a certain kind.

"Our customers like to trade products that are volatile and have great liquidity," said Salomon Sredni, CEO ofTradeStation , an online brokerage firm focused on the trading community rather than buy-and-hold investors. For active, swing and day traders, the intraday volatility of stocks and exchange traded funds presents a stock market opportunity . They use leverage, options and other sophisticated investing strategies to play off -- and profit from -- price swings. TradeStation ranked among the top five brokerages for ETF choices in IBD's Best Online Brokers 2015 survey. It moved up the rankings in this year's poll, as didVanguard Brokerage Services. Fidelity Brokerage Services debuted in this list, whileInteractive Brokers ( IBKR ) dropped off. Charles Schwab ( SCHW ) andTD Ameritrade ( AMTD ) rounded out the top five. Founded in 1982 as a research firm, TradeStation offers access to more than 1,600 ETFs. The broker makes an ETF available to investors as soon as the product is listed on a U. S. exchange, as many other brokers do. But to attract active traders, its core clientele, TradeStation had to do something more. The solution: hundreds of apps for fast, reliable, creative trading. Sredni calls TradeStation a state-of-the-art, open platform. Its popularity hinges on 300 apps (from third-party developers) that integrate with its downloadable desktop PC software. The platform can also be accessed via a Web browser or mobile device. It lets investors monitor streaming quotes in real time, analyze markets with advanced charting tools and place trades on the go. Traders can fully automate strategies involving high levels of detail.

The platform gives them powerful tools to back-test, optimize and monitor their trading routines. "If you have a particular method that you think is going to work, we encourage you to test that idea in the market," Sredni said. The possibilities, he adds, are limited only by a user's imagination. One of the most popular apps -- Moon-ES, with a $99 monthly subscription -- offers accredited traders "a customizable, hedge-fund style day-trading system." TradeStation has yoked these tools to a robust trading platform. "We take reliability, we take speed and we take power to heart," Sredni said. Traders are directly connected to exchanges and financial institutions for greater access to market liquidity. Orders are executed in 0.05 second, according to Transaction Auditing Group. That's more than 20 times faster than the industry average of 1.07 seconds. And TradeStation's proprietary backup system is designed to keep the network running even under stress conditions. "Quality of execution is very important to our customers," Sredni said. TradeStation has roughly 60,000 brokerage accounts. The firm says its customers do the same number of average monthly trades as a leading rival's several million clients.

Unlike TradeStation, Vanguard Brokerage Services is focused on retail investors. Its clients also include endowments, foundations and retirement plan participants. The business has grown rapidly over the past five years, as has ETF usage on it. On average, a quarter to a third of all daily trades is ETFs. In 2010, roughly one in eight trades was an ETF. ETFs now account for more than 20% of the market value of clients' securities in Vanguard's brokerage business. John Heywood, a principal in the retail investor group at Vanguard, notes that the brokerage unit's growth coincided with a dramatic reduction in fees. Vanguard introduced zero-commission trades for its own ETFs in May 2010. They had previously cost $9 to $45 per trade. Stocks and non-Vanguard ETFs incur a $7 to $25 trading fee. As a result, the 67 Vanguard-branded ETFs with zero trading fees dominate ETF trading on Vanguard Brokerage Services. They account for two-thirds of daily ETF trades. In 2010, trading was split roughly even between Vanguard and non-Vanguard ETFs. " Costs are the most important element , and it's what our clients have responded to," said Heywood.

At TradeStation, brokerage costs for stocks and ETFs come in two varieties. The company offers a novel per-share commission option that's ideal for traders looking to buy or sell a smaller number of shares per order. At a penny per share, 100 shares cost $1 to trade. At other leading online brokers, that same trade could incur a flat fee ranging from $7.95 to $9.99. TradeStation also has a flat-fee commission model, which starts at $4.99 per trade -- lower than most other top online brokers. Costs can go up to $9.99 per trade, depending on monthly trading volume. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of NASDAQ, Inc. ETF Options Vs. Index Options. The trading world has evolved at an exponential rate since the mid-1970s. Fueled in large part by the vast expansion of technological capabilities - and combined with the ability of financial firms and exchanges to create new products to address each new opportunity - investors and traders have at their disposal a vast array of trading vehicles and trading tools. In the mid-1970s, the primary form of investment was simply to buy shares of an individual stock in hopes that it would outperform the broader market averages. Around this time, mutual funds started to become more widely available which allowed more individuals to invest in the stock and bond markets. In 1982, stock index futures trading began. This marked the first time that traders could actually trade a specific market index itself, rather than the shares of the companies that comprised the index. From there things have progressed rapidly.

First came options on stock index futures, then options on indexes, which could be traded in stock accounts. Next came index funds, which allowed investors to buy and hold a specific stock index. The latest burst of growth began with the advent of the exchange-traded fund (ETF) and has been followed by the listing of options for trading against a wide swath of these new ETFs. An Overview of Index Trading. A market "index" is simply a measure designed to allow investors to track the overall performance of a given combination of investment instruments. For example, the S&P 500 Index tracks the performance of 500 large-cap stocks while the Russell 2000 Index tracks the movements of 2,000 small-cap stocks. While such market indexes track the "big picture" of price trends, the fact is that for most of the 20th century the average investor had no avenue available to actually trade these indexes. With the advent of index trading, index funds and index options that threshold was finally crossed. The Vanguard family of funds became the first fund family to offer a variety of index mutual funds, with the most prominent being the Vanguard S&P 500 Index Fund. Other families including Guggenheim Funds and ProFunds took things to an even higher level by rolling out, over time, a wide variety of long, short and leveraged index funds.

The Advent of Index Options. The next area of expansion was in the area of options on various indexes. The listing of options on various market indexes allowed many traders for the first time to trade a broad segment of the financial market with one transaction. The Chicago Board Options Exchange (CBOE) offer listed options on over 50 domestic, foreign, sector and volatility based indexes. A partial listing of some the more actively traded index options on the CBOE by volume as of September 2016 appears in Figure 1. The first thing to note about index options is that there is no trading going on in the underlying index itself. It is a calculated value and exists only on paper. The options only allow one to speculate on the price direction of the underlying index, or to hedge all or some part of a portfolio that might correlate closely to that particular index. An ETF is essentially a mutual fund that trades like an individual stock. As a result, anytime during the trading day an investor can buy or sell an ETF that represents or tracks a given segment of the markets. The vast proliferation of ETFs has been another breakthrough that has greatly expanded the ability of investors to take advantage of many unique opportunities. Investors can now take long andor short positions - as well as in many cases, leveraged long or short positions - in the following types of securities: Foreign and Domestic Stock Indexes (large-cap, small-cap, growth, value, sector, etc.

) Currencies (yen, euro, pound, etc.) Commodities (physical commodities, financial assets, commodity indexes, etc.) Bonds (treasury, corporate, munis international) As with index options, some ETFs have attracted a great deal of option trading volume while the majority have attracted very little. Figure 2 displays some of the ETFs that enjoy the most attractive option trading volume on the CBOE as of September 2016. While ETFs have become immensely popular in a very short period of time and have proliferated in number, the fact remains that the majority of ETFs are not heavily traded. This is due in part to the fact that many ETFs are highly specialized or cover only a specific segment of the market. As a result, they simply have only limited appeal to the investing public. The key point here is simply to remember to analyze the actual level of option trading going on for the index or ETF you wish to trade. The other reason to consider volume is that many ETFs track the same indexes that straight index options track, or something very similar. Therefore, you should consider which vehicle offers the best opportunity in terms of option liquidity and bid-ask spreads. Difference No.1 Between Index Options and Options on ETFs. There are several important differences between index options and options on ETFs. The most significant of these revolves around the fact that trading options on ETFs can result in the need to assume or deliver shares of the underlying ETF (this may or may not be viewed as a benefit by some).

This is not the case with index options. The reason for this difference is that index options are "European" style options and settle in cash, while options on ETFs are "American" style options and are settled in shares of the underlying security. American options are also subject to "early exercise," meaning that they can be exercised at any time prior to expiration, thus triggering a trade in the underlying security. This potential for early exercise andor having to deal with a position in the underlying ETF can have major ramifications for a trader. Index options can be bought and sold prior to expiration, however they cannot be exercised since there is no trading in the actual underlying index. As a result, there are no concerns regarding early exercise when trading an index option. Difference No.2 Between Index Options versus Options on ETFs. The amount of option trading volume is a key consideration when deciding which avenue to go down in executing a trade. This is particularly true when considering indexes and ETFs that track the same - or very similar - security. For example, if a trader wanted to speculate on the direction of the S&P 500 Index using options, he or she has several choices available. SPX, SPY and IVV each track the S&P 500 Index. Both SPY and SPX trade in great volume and in turn enjoy very tight bid-ask spreads. This combination of high volume and tight spreads indicate that investors can trade these two securities freely and actively. At the other end of the spectrum, option trading on IVV is extremely thin and the bid-ask spreads are significantly higher.

In choosing between trading SPX or SPY a trader must decide whether to trade American style options that exercise to the underlying shares (SPY) or European style options that exercise to cash at expiration (SPX). The trading world has expanded by leaps and bounds in recent decades. Interestingly, the good news and the bad news in this are essentially one and the same. On one hand we can state that investors have never had more opportunities available to them. At the same time the average investor can easily be confused and overwhelmed by all of the possibilities that swirl around him or her. Trading options based on market indexes can be quite profitable. Deciding which vehicle to use - be it index options or options on ETFs - is something that you should give some serious consideration to before "taking the plunge." Best Online Brokers for ETF Investing. Exchange-traded funds (ETFs) offer investors a simple way to build a diversified portfolio on the cheap. Because ETFs trade like individual stocks, many of the features sought by investors in a stock trading account are also relevant to ETF-focused investors. But because ETFs essentially are mini-mutual funds, it’s important to consider other criteria, including a broker’s fund selection and commission-free offerings.

Here are NerdWallet’s picks for best online brokers for every kind of ETF investor, whether you’re looking for a broker with the broadest range of ETFs, the lowest account minimum, least expensive commissions or the best platform to help you build and manage an ETF portfolio. Best overall brokers for ETF investors. These online brokers offer the broadest range of high-quality commission-free ETFs as well as tools to help investors pick the best ones for a well-rounded portfolio . For their robust lineup of high-quality, low-cost ETFs, as well as tools to help investors assemble a top-notch ETF portfolio, Charles Schwab and Vanguard are NerdWallet’s best overall brokers for ETF investing. Each broker offers a broad array of commission-free ETFs (more than 200 at Charles Schwab and 55 at Vanguard). One of the standout features at Charles Schwab is the company’s ETF Portfolio Builder, which helps investors create a diversified ETF portfolio based on risk tolerance. The company’s analysts also produce a quarterly list of prescreened mutual funds and ETFs divided by category, which makes it easy to identify funds to fill in any portfolio gaps. Low-cost investing powerhouse Vanguard is a standard bearer in the ETF category. Thanks to its bargain-basement expense ratios, the financial firm has become the Costco of ETFs: Almost all of the robo-advisors shop at Vanguard for their ETF inventory. While its selection of commission-free ETFs is just a quarter of Schwab’s inventory, customers reap ongoing savings from Vanguard’s famously low management expenses.

Where Vanguard edges out Schwab is in the required account minimum: It’s $0. You’ll need $1,000 to open an account at Schwab unless you sign up for a $100 monthly minimum auto deposit, in which case the requirement is waived. Investors who plan on trading outside of the no-commission offerings will benefit from Schwab’s flat $4.95 per-trade commission. At Vanguard, commissions are $7 for the first 25 online trades per year, $20 for subsequent trades. Best low-cost brokers for ETFs. These brokers offer a large number of commission-free ETFs. All you need is enough money in your account to buy a single share to start building your ETF portfolio at these brokers. The Robinhood investing app is the bare-bones choice for commission-free ETF trading. Its no-frills, mobile-only platform offers easy access to more than 5,000 equities and ETFs. (The company does not break out the number of ETFs versus equities offered.) One important note: When we say no frills, we mean that features such as research and data are not included on the streamlined app, and customer service is available via phone and email only during regular weekday business hours. Also note that the broker supports only individual taxable accounts and not IRAs. But if slashing all fees — annual, inactivity and trading commissions — is your top priority, then Robinhood delivers.

Investors seeking the perks of a full-service broker — a full suite of investing and educational tools as well as support for IRAs and individual accounts — might be happier with our top pick Charles Schwab. The broker gets highlighted again here for its lengthy list of commission-free ETFs and low expense ratios. Also worth a mention in the low-cost category are two additional investing apps that have extremely low investing minimums and are aimed at new investors who want to add small amounts of money over time: Stash operates like an ETF matchmaker that makes recommendations based on the usual users’ stuff (risk tolerance and goals) as well as their personal interests and values Acorns operates on the “save your spare change” model it rounds up purchases on linked credit or debit cards and puts the money into a computer-managed ETF portfolio. The drawbacks of these apps are that the ETF pickings are slim and — like Robinhood — Acorns does not support IRAs. Best online advisors for hands-off ETF investing. These robo-advisors will build a customized portfolio of low-cost ETFs based on your investing goals and risk tolerance. Plus, they’ll keep it balanced and optimized for tax savings. ETFs are the investment of choice for robo-advisors, which makes these automatic-investing services a one-stop shop for investors who want a customized portfolio built, managed and maintained for them based on their time horizon and appetite for risk. Wealthfront and Betterment — NerdWallet’s top picks overall for best robo-advisors — can ably get the job done for less than it costs to hire an investment manager. The same rules about keeping fees in check apply to all ETF shoppers, whether you’re looking to hire a robo-advisor or going the DIY route. Expense ratios on ETFs used in Wealthfront portfolios average 0.12%, compared with 0.09% to 0.17% at Betterment. What you’ll pay in management fees depends on the size of your portfolio. If you have less than $10,000 to invest, Wealthfront is the most cost-effective choice, with no management fee on the first $10,000 and 0.25% on investments exceeding that amount.

Betterment has two fee plans ranging from 0.25% to 0.40% per year based on the level of service you want. (See more details about the differences between the two robo-advisors in our Wealthfront vs. Betterment comparison.) Best online brokers for building and managing an ETF portfolio. These brokers offer robust trading platforms with tools geared toward the active ETF investor. The trade-off: fewer commission-free ETFs than the competition. TD Ameritrade and E-Trade offer a happy middle ground for investors who don’t want to cede complete control over their investing to a robo-advisor but still want some professional guidance. Both brokers offer tools to help investors assemble a risk-appropriate, balanced portfolio of ETFs. (And for those who aren’t ETF purists, the companies will help you include mutual funds and stocks, too.) Both brokers offer more than 100 commission-free ETFs, covering a mix of equity funds, bond funds, international funds and commodity funds. Each also provides a professional tour guide of sorts to highlight the top picks. TD Ameritrade’s ETF lineup is curated by investment research company Morningstar, which is highly regarded in the industry for its mutual fund and ETF ratings.

E-Trade’s analysts produce a quarterly All-Star List to highlight the top no-load funds and ETFs offered. E-Trade’s My Virtual Advisor tool offers free asset allocation recommendations for investors of self-directed funds, ETFs and stocks. TD Ameritrade’s prebuilt asset allocation models are a valuable tool to guide investors through the process of assembling a properly balanced portfolio of ETFs, stocks and mutual funds. Its models are nimble enough to accommodate plenty of customization. Best online brokers for active ETF traders. These brokers offer robust trading platforms with tools geared toward the active ETF investor. The trade-off: fewer commission-free ETFs than the competition. Time-sensitive data and timely trade execution are essential tools for active ETF traders. Both Fidelity and Interactive Brokers provide the tools to monitor real-time minute price movements, create alerts and watchlists, and have mobile capabilities to trade on the go. Interactive Brokers’ Trader Workstation has a good reputation among active, advanced investors with its volatility lab, advanced charting, heat maps of sector and stock performance, and paper trading. Its mutual fund replicator helps users identify ETFs that replicate the performance of a selected mutual fund — a great fee-slashing feature. All Fidelity customers have access to its comprehensive web, mobile and desktop trading platforms. Its ETF snapshot pages include an impressive number of analyst ratings and access to reports.

Those who qualify can access the premium Active Trader Pro (with advanced tools) and Wealth-Lab Pro, an advanced method testing tool. Low commissions are another priority for active traders. Interactive Brokers’ stock and ETF commission structure favors frequent, high-volume traders at just $0.005 per share. There are a $1 minimum trade commission and a 0.5% maximum, with exchange and regulatory fees included. Plus, volume discounts are available. But this comes at a cost: higher account minimums ($10,000 for a standard account) and an extra charge to access premium features. Fidelity offers no volume trading discount, but outside of its Active Trader Pro platform (which is restricted to customers who trade at least 36 times in a rolling 12-month period), its research and data are free and extensive. Best online brokers for ETFs: summary. free trading app for beginners. per trade volume discounts. Learn more about ETFs. ETFs allow investors to invest into a diversified selection of stocks, bonds or other investments in a single transaction. Like mutual funds, ETFs pool investor money to purchase shares of a number of different investments. Those investments generally mimic a benchmark, like the S&P 500.

Unlike with mutual funds, ETF investors don’t own the underlying assets in the fund — the ETF provider maintains ownership. Instead, ETF shareholders own a portion of the ETF itself. ETFs are traded on an exchange, much like an individual stock, which means they can be bought and sold throughout the day. You can read more about ETFs in this explainer: What is an ETF? How much do ETFs cost? Like any investment, that varies. But again, as with mutual funds, ETF costs come from a couple different directions. Commissions. Because ETFs trade on an exchange, they’re subject to broker stock commissions. But many brokers — including the ones above — now have a lengthy list of commission-free ETFs that can be traded at no cost. If you’re planning to buy and sell ETFs frequently, make sure the ones you’re interested in are on that list. Expense ratios.

As with any fund, ETFs charge an expense ratio to pass the cost of administering the fund on to investors. The expense ratio is an annual fee, expressed as a percentage of your investment: a 1% expense ratio costs $10 a year for every $1,000 you invest in the fund. In general, because ETFs passively track a benchmark, their expenses tend to be lower than what you’d pay for an actively managed mutual fund. Take a look at average fund expense ratios so you know where your ETF stands. How much money do you need to invest in ETFs? That’s the beauty of ETFs — not much. Because they are traded for a share price, you don’t run into the typical mutual fund minimums, which can be $1,000 or more. You can purchase an ETF share for as little as $10 or $20 in some cases. Robo-advisors that use ETFs in their portfolios may even allow you to buy fractional shares — portions of a fund smaller than a single share. That said, some brokers have account minimums, though there are quite a few options above that do not. How do you trade ETFs?

To trade ETFs, you’ll need an account with an online broker. If you don’t have one, you can open one with one of the companies listed above in about 15 minutes — the whole process can typically be done online. Once the account is funded, you can purchase ETFs using their ticker symbol, very similar to the way you’d buy stocks. (Here’s how to narrow your options when investing in ETFs.) You’ll place an order on your broker’s website or online trading platform with the ETF’s ticker, the order type and the number of shares you’d like to purchase. How do you make money on an ETF? ETFs earn a return through dividends or price appreciation — when the underlying assets go up in value, your investment in the ETF does, too. You may then be able to sell the ETF for a higher price than you paid for it, though we recommend choosing funds you can hold for the long term. What’s the difference between an ETF and a mutual fund? The main difference is in how these funds invest, and how they’re bought and sold.

As we noted above, ETFs can be traded throughout the day, leading to the kind of price fluctuations you might see with individual stocks. They also tend to be more tax-efficient. Mutual funds are typically purchased from fund companies rather than other investors, and are priced once a day after the market has closed. Though ETFs can be actively managed, most are passive, tracking an index. Many mutual funds are actively managed and employ a professional to pick and choose investments, which can result in higher fees. Updated Sept. 22, 2017. Dayana Yochim. Dayana is a personal finance writer at NerdWallet. Her work has been featured by Forbes, Real Simple, USA Today, Woman's Day and The Associated Press. Read more. Disclaimer: NerdWallet has entered into referral and advertising arrangements with certain broker-dealers under which we receive compensation (in the form of flat fees per qualifying action) when you click on links to our partner broker-dealers andor submit an application or get approved for a brokerage account. At times, we may receive incentives (such as an increase in the flat fee) depending on how many users click on links to the broker-dealer and complete a qualifying action. Best ETF Brokers + Platforms For Trading Exchange Traded Funds Online.

An ETFs broker arranges transactions between a buyer and seller for exchange-traded funds, which are investment funds that are trade via a stock exchange, similarly to the way a traditional stock is. ETFs hold assets, typically commodities, bonds or stocks, and the price is closely tied to the net value of the assets held. ETFs are a desirable option because they have many of the attractive features of stocks but reduce variance by spanning a portfolio of assets rather than a single asset. Only an authorized participant may purchase an ETF directly to or from the fund itself. The Best ETFs Brokers + Trading Platforms. Trusted, regulated broker with 10 yrs experience Multi award winning company Segregated accounts with leading banks. Choice of four professional trading platforms Trusted & Secure: authorised and regulated Choice of Forex, CFDs, Spread Betting and Binary Options. Tight spreads without commissions Advanced charting tools. + Up to £6000 on deposits. No commissions and low spreads Advanced trading tools Minimal account fees. +40% Deposit Bonus. Generous Cashback Rewards for every trade Leverage the wisdom of the crowds to inform your positions Fast, simple signup.

Related Articles. ETX Capital. AVATrade. Ayondo. Featured Brokers. Risk Warning. Your capital is at risk. Trading in Forex and Contracts for Difference (CFDs) is highly speculative and involves a significant risk of loss. The information contained in this publication is not intended as an offer or solicitation for the purchase or sale of any financial instrument. This website is provided for informational purposes only and in no way constitutes financial advice. A featured listing does not constitute a recommendation or endorsement. About ForexTrading. Company.

Forex Trading. Company was established to provide global traders a deep and insightful source of information on forex trading, its key strategies and indicators. With guides for everyone from beginner traders in Bangladesh to advanced strategists in Hong Kong we want the world trading community to benefit from our in-depth broker reviews, features, and commentary. We list the world's top regulated and authorised brokers suitable for a global audience. We aim to think global, act local with our website, so that whether you're in Asia, Europe or Africa you can gain from our content on the world's biggest market. Best Online Brokers for Stock Trading 2017. NerdWallet offers financial tools and advice to help people understand their options and make the best possible decisions. The guidance we offer and info we provide are deeply researched, objective and independent. We spent over 300 hours reviewing the top online brokers before selecting the best for our readers. And to help you find the one that’s best for you, we’ve highlighted their pros, cons and current offers. There is no single best online broker for stock trading.

But among the dozens of financial firms vying for your investing dollars will be one that’s best for you. Are you just starting out and looking for a friendly place to learn the ropes? Really into trading options and futures? Seeking access to sophisticated investing research? A cost-conscious frequent trader? Below are the brokers that earned NerdWallet’s highest marks based on the breadth and quality of their offerings in the areas that matter most to individual investors. To find a suitable online broker, read on for highlights (and links to our in-depth reviews on each). Best Online Brokerages For Stock Trading. TD Ameritrade : Best overall & for beginners Charles Schwab : Best overall, for beginners & investment selection Merrill Edge : Best for research Fidelity : Best for research E-trade : Best for investment selection Ally Invest (formerly TradeKing) : Best for low cost Interactive Brokers : Best for low cost. NerdWallet’s top online brokers.

Merrill Edge offers high-quality customer service, robust research and low commissions and fees. Customers of parent company Bank of America will love the seamless, thoughtful integration, with a single login to access both accounts. Low commissions and fees. Robust third-party research. Ongoing promotions. Integrated with Bank of America. Free trades for eligible Bank of America customers. No commission-free ETFs. Minimum balance requirement for active trading platform. Ally Invest may be a deep-discount broker, but its robust trading platform and lineup of free research, charting, data and analytical tools puts it in line with some of its more well-known — and higher-priced — competition.

Low commissions. No account minimum. Strong web-based platform. Robust research and tools. No commission-free ETFs. No no-transaction-fee mutual funds. Fidelity may be known for its retirement accounts, but active traders shouldn’t overlook the brokerage’s low trade commissions, wide investment selection, large scope of research and strong trading platform. It’s a well-rounded broker suitable for nearly all investors. Low commissions Large selection of research providers Strong customer service. High account minimum Trade minimum for active trading platform. TD Ameritrade makes up for higher-than-average trading commissions with better-than-average service, research and trading tools that will make everyone from beginner investors to active traders happy.

Large investment selection. Free research. High-quality trading platforms. No account minimum. Good customer support. Higher trade commission. Costly broker-assisted trades. High short-term ETF trading fee. E-Trade has long been one of the most popular online brokers, largely because of its easy-to-use tools. They offer a tiered commission structure that favors frequent traders but can add up to high costs for casual investors. Easy-to-use tools. Large investment selection.

Excellent customer support. Access to extensive research. Advanced mobile app. Reduced commissions for frequent traders. Higher commissions for low-volume traders. Minimum balance requirement for active trading platform. Charles Schwab has earned its strong reputation: The broker offers high-quality customer service, two robust trading platforms and a wide selection of commission-free ETFs and no-transaction-fee mutual funds. No inactivity fees. Two platforms with no minimum or fees. Above-average mobile app. Extensive research. Strong customer support.

Higher trade commissions. Higher account minimum. Interactive Brokers is a strong option for advanced, frequent traders: The broker offers international trade capabilities, low commissions and a quality trading platform. New traders might be turned off by inactivity fees, high balance requirements and a lack of educational resources. Low commissions Quality trading platform Advanced tools Low margin rates Wide investment selection. Inactivity fees High minimum balance requirement Complex pricing Minimal educational resources. More guidance to help you pick the right broker. Here are more NerdWallet resources to answer other common questions about online brokerage accounts. Do I have enough money to get started investing? You don’t need much to get started.

Note that many of the brokers above have no account minimums. One easy way build a diversified portfolio for little money is to invest in exchange-traded funds. ETFs are essentially bite-sized mutual funds that trade like stocks: Like a mutual fund, ETFs contain a basket of similar assets (e. g., stocks in the S&P 500 index or shares of companies that operate in the technology sector). But instead of having to qualify for a mutual fund investment minimum, investors can buy and sell individual shares of ETFs just like individual stocks. Is the money in brokerage accounts insured? Are there different kinds of accounts? What paperwork do I need to open a stock trading account? For answers to all these questions and more, read the what is a brokerage account and how do I open one guide. How do I determine if a broker is right for me before I open an account? Some key criteria to consider are how much money you have, what type of assets you intend to buy, how frequently you plan to transact and how much service you need. Our post about how to choose the best broker for you can help to arrange and rank your priorities. Summary: Best online brokerages. Fidelity.

per trade volume discounts. up to $600 ($250,000+ deposit) per trade volume discounts. Interactive Brokers. min. $1, max. 0.5% of trade value. Dayana Yochim is a staff writer at NerdWallet, a personal finance website: Email: dyochim@nerdwallet. com. Twitter: @DayanaYochim. Updated June 30, 2017.

Disclaimer: NerdWallet has entered into referral and advertising arrangements with certain broker-dealers under which we receive compensation (in the form of flat fees per qualifying action) when you click on links to our partner broker-dealers andor submit an application or get approved for a brokerage account. At times, we may receive incentives (such as an increase in the flat fee) depending on how many users click on links to the broker-dealer and complete a qualifying action. The Best Options Broker. Latest Update October 28, 2016. The best options trading platform isn’t going to be an afterthought tacked on to an existing suite of products: it should be robust and easy to use. Beginners need enough support to learn the ropes and experienced traders are after low fees and powerful tools. We signed up, assessed the fees, took the tools for a spin, and narrowed it down to three top picks. The one that's best for you depends on what you’re after. Tons of online and in-person support, plus a practice platform that lets you try everything out with “paperMoney.” The downside? Higher fees. Rock-bottom pricing, but no research or method support. Unrivaled tools & research with pricing that favors active traders. There are a lot of brokers that are perfectly capable of trading options — nearly all of the big (read: old-school) names have an options platform integrated into their suite of offerings.

But for those looking to really dive in, whether as a beginner just starting out or an active trader looking to level up, the best platform won’t be something that’s just tacked on. How We Found the Best Options Broker. To find the brokers that cater specifically to options, we looked at 36 choices and analyzed their products. We prioritized the most important aspects: Cost matters a lot when it comes to trading options. It’s the very nature: part of the appeal of options is that the returns can be major even if you don’t fork over a lot of cash up front, and many traders use options as a cheaper alternative to going long on a high-priced stock. Fees can add up and even wipe out the profits from any profitable trades. Granted, slightly higher fees may be worth it if a broker can provide other perks (say, excellent resources and education for beginners), but we wanted all our picks to have competitive pricing. We also wanted to avoid minimum balance requirements, or a set number of trades per month. Easy-to-use interfaces are a make-or-break for most platforms. The price of options contracts can swing a lot over the course of a trading day poking around a clunky options chain can literally cost you. Education and resources are important, especially for investors who are getting their feet wet.

Sure you’ve got a handle on multi-leg options trades, but do you know when it’s the right time for a bull call spread? What’s an iron butterfly? Not all traders will need hand-holding, but we wanted to find at least one excellent options broker we could recommend to newcomers. Flexibility can be interpreted a few ways. For us, it meant the robustness of the platform (could we research and purchase stocks and ETFs in addition to options?) its flexibility (could we streamline a multi-leg options trade, or did we have to input them all separately?) and whether or not we could customize it to our liking. It was quick work to eliminate the most expensive platforms, as well as the ones that had absolutely no resources or reports. To test ease of use and flexibility, we signed up for accounts and simulated making trades on all the rest. Three brokers rose to the top, and each brings something unique to the table. Our Picks for Best Options Broker. TD Ameritrade Higher fees on an ultra-easy platform.

Plus, tons of support and education. TD Ameritrade is one of the largest online brokerages in the market today, with over 7 million funded customer accounts and over $700 billion in total client assets, and despite its slightly higher prices, it provides the best platform for a beginner trading any product, options or otherwise. For more novice traders, the platform supports the jump from trading stocks with the funds in an IRA to more sophisticated products like options. It’s robust, plus it has the customer service and educational resources to make the transition. There are webinars and hours of on-demand videos that’ll teach you about options strategies and how to literally execute those strategies on the platform. TD Ameritrade is a full-service broker, and that full service (we’re talking 247 customer service and 100 branches for face-to-face consultations) does come with higher fees. Barron’s agrees, awarding it “best platform for novices” five years running. We can anticipate its service only getting better too. In 2016, TD Ameritrade started the process of acquiring Scottrade, another platform known for it’s in-person customer service offerings. In fact, TD Ameritrade is one of the best platforms for all levels of investors, serving up two discrete products: thinkorswim and Trade Architect.

Thinksorswim is a desktop platform designed for an all-around trading experience: charts with real-time data, news tickers, 300-plus technical studies, alerts and alarms, heat mapping, options screeners, securities scanner, and more, all accessible in a single click. It’s definitely for seasoned investors — newcomers will likely be overwhelmed — but it’s worth bringing up because a virtual playspace called paperMoney allows even total novices to cut their teeth without risking even a single penny. We recommend beginners stick to TD Ameritrade’s web-based platform Trade Architect. It is nowhere near as robust as thinkorswim (and has nowhere near as jazzy a name), but it provides everything a new investor would want and it’s ultra-easy to use. It’s not bogged down with all the bells and whistles and live-streaming CNBC. Tabs at the top are simply categorized under jargon-free headings: account overview, watch lists, alarms, idea generators, and heat maps. Unlike thinkorswim, the platform is customizable. If you want more widgets, like say, additional stock tickers or video, they’re there for the adding. If beginner investors use TD Ameritrade’s education library to learn the ropes, practice using paperMoney in thinkorswim, and then easily execute trades with Trade Architect, the slightly higher fee may suddenly seem worth it. OptionsHouse The lowest fees and no minimum balance requirements. OptionsHouse isn’t the most recognizable name in the industry, and that’s probably because this online broker hasn’t pursued an aggressive marketing campaign like some of the other brokers out there (remember E*Trade’s old Super Bowl ads?). The company was founded in 2005 and was established to specifically provide options traders who demanded lower fees from the then burgeoning online brokerage industry.

Those low fees are still what makes OptionsHouse so popular. There’s a $0 minimum deposit to join and options trade at $4.95 + $0.50contract (stocks trade at a flat $4.95 fee). This is the lowest price in the industry. Only TradeKing comes close — matching that $4.95 options base fee, but charging $5 more than OptionsHouse for the exercise fee. The OptionsHouse platform is striking if a bit chaotic — there are buttons, tabs, and menus all over the place. It’s intuitive and there’s a tutorial to walk you through, but to a beginner it might seem more like sitting in front of the controls of an aircraft than is comfortable. Beginners take note: OptionsHouse does have a virtual platform that’s great for practicing. And, the tradeLAB makes dissecting options spreads simple — the green smiley face is good the red frown is no good. What you won’t get for those low fees is method and research: OptionsHouse has about 30 technical studies TD Ameritrade has 300. It’s important to note that E*Trade purchased OptionsHouse for a whopping $725 million in 2016. It is still unclear how any pricing structures or account features and perks will change after the sale is completed, but an OptionsHouse blog post suggests that E*Trade’s tools and services will become available after the platforms merge. Best Tools and Research. optionsXpress A one-stop shop within a major firm, with an options-native platform.

OptionsXpress was purchased by Charles Schwab back in 2011 to enhance Schwab’s competitive edge in options trading. The result is a one-stop shop with an options-native platform that’s pretty whiz-bang. Everything happens through the desktop platform, Xtend, but all the trading tools are also on the optionsXpress web platform. It’s fully customizable, and it’s easy to find real-time quotes and market data, news and reports, and company background information. The Idea Hub scans the market for volatility, earnings, and income-based strategies and offers new trade ideas. With Walk Limit, you can set a few parameters, and it will scan updated market data and re-create an order you may have made at a higher price in the past. Sign up for the Xpresso newsletter and you’ll get a daily email alerting you to the day’s risks and opportunities. Add to that an impressive library of educational resources, as well as access to all of Charles Schwab’s investment research (and free access to its seminars and meetings at local branches), and a virtual trading platform that helps beginner investors practice all types of trading with $25,000 in fake cash. If you need help from a broker — to calm your first-timer nerves or to walk you through a complex method — they’re ready to help and totally free, too. The standard rates are steep, so we don’t recommend optionsXpress to the casual trader. Make more than 35 trades a quarter and you’ll click into “Active Trader” status and your fees will go down. Trade in volumes and there’s another discount trade contracts under a nickel and there’s another discount. This is all to say the price structure favors the active.

And while optionsXpress has a $0 account minimum and does not charge any annual or inactivity fees, if you leave, there is a $60 full outgoing transfer fee. The Best Options Broker at a Glance. Options are contracts that allow an investor the right, but not the obligation, to buy or sell an asset on or before a set date. Here’s an example: Say you are a buyer looking for a specific vintage car and you end up finding one you just have to have. When you find it, however, you know you won’t have any cash to buy it for another six months. You then negotiate with the owner to give you an option to buy the car in six months for a specific amount. If the owner agrees, you pay him a percentage up front for that option. The same scenario applies in the stock market – just for financial assets instead of vintage cars. If you were trading stocks, you’d be actually buying the car. Or, rather, not buying it since you didn’t have the money.

Because options are simply options and not promises, if something happened to that vintage car — say it was sitting in the driveway and a tree fell on it — you wouldn’t have to buy it. You’d still be out the price you paid for the options contract, but at least you wouldn’t have lost all that money on a now-worthless pile of steel. And, if in those same six months something happens that makes the car go up in value, well, hey, you’ve already locked in your price. If you’re new, you should prize learning tools. If you’re experienced, you’ll need to choose between low cost or amazing tools. No matter what, options trading shouldn’t be an afterthought tacked onto your platform. Best for Beginners. TD Ameritrade TD Ameritrade fees might be higher, but sometimes you get what you pay for. Consider your entire investment method. Don’t make your final decision solely based on options trading if it’s not the only kind of trading you’ll be doing. These online brokerage firms all offer a variety of investment opportunities. You may want to take into account their extra perks or the price of their mutual funds, for example. Know your expirations. Options are contracts that expire if they’re not acted on and an expired contract is worthless. Make sure you understand your expirations and set reminders using your broker’s platform, or on your calendar if you’re not trading every day.

We find the best of everything. How? We start with the world. We narrow down our list with expert insight and cut anything that doesn't meet our standards. We hand-test the finalists. Then, we name our top picks.