OptionsHouse Review 2018

January 8, 2018
OptionsHouse Review Investing

2018 Update: The Optionshouse brand was eliminated in 2017 and rolled into ETRADE. This is an unfortunate change because ETRADE charges higher commissions and fees across the board.

Instead of paying higher fees, consider switching to M1 Finance (see my review) to trade stocks and ETFs for free.

Original Review: I first opened an OptionsHouse account more than five years ago. This OptionsHouse review will cover everything that I’ve learned, including the basics of the platform and pricing for individual investors.

OptionsHouse opened in 2005 and immediately disrupted the online brokerage space. At that time, most online brokers were charging $10 or more in commissions per trade. Some were still attempting to get $25 per trade. OptionsHouse introduced low-cost trades for less than $5 and put pressure on other online brokers to lower their fees.

In 2014, OptionsHouse merged with tradeMONSTER to grow the brand and expand the number of available services. In 2016, OptionsHouse was acquired by ETRADE for $725 Million. Through these changes, OptionsHouse improved every dimension of their trading platform and was named a top online broker by Barron’s.

Optionshouse Platform and Tools

The merger with ETRADE has allowed OptionsHouse to build one of the most robust web-based trading platforms available today.

The entire platform is designed to work on any device, including your computer, tablet, and mobile phone. You can access your account through any modern web-browser, or download the OptionsHouse mobile app on any smartphone. The result is a lightweight platform that prioritizes reliability, speed and ease of use.

Because the platform is web-based, any customizations that you make are saved in your profile and synced across every device. This ensures that you always have access to the robust tools and trading platform, regardless of your chosen device.

optionshouse-platform-review

The OptionsHouse platform includes a number of important trading tools (at no additional cost).

TradeLAB allows you to quickly evaluate each trade’s potential on a single screen, including the probability of profit, loss or breakeven. It also offers insights on the risk/reward potential of each security that you are evaluating based on the current stock price and recent volatility. Within tradeLAB, you can run “what-if” scenarios for every investing angle that you can think of.optionshouse-reviews

The OptionsHouse platform provides significant automation capabilities, including the ability to create custom orders in advance and pre-populate trade actions. The platform then pushes a customizable trigger alert and you can submit saved orders directly from the alert (on any device).optionshouse-platform

Options traders should consider using the strategySEEK tool, which scans live market data for options strategies based on specific criteria defined by you. After inputting your investment objectives and expectations, the strategySEEK tool will run a number of data calculations to suggest new strategies that you might consider when placing trades.

You can then evaluate each strategy using tradeLAB, modify it, or place a pre-populated order using the customizable settings described above.

OptionsHouse also offers a virtual trading platform, completely free of charge. When you open an account (no minimum funding requirement), you can set up a free paperTRADE virtual account at the same time.

In the paperTRADE account, you can make trades using virtual money and learn the platform’s trading functions in a live market environment. This virtual account functions exactly like your normal account, and includes all of the live trading platform features. The only difference is the use of virtual money.

OptionsHouse Fees:

This continues to be the selling point for OptionsHouse, and the primary reason I chose to use the platform in the first place.

First of all, there are no fees associated with opening or maintaining an account. Unlike the majority of other brokerages, Optionshouse does not require that you initiate a certain number of trades or maintain a minimum account balance. You can open the account and trade on your timing without worrying about ridiculous hidden fees.

In addition, the trade fees are still dirt cheap when compared to other brokerage firms:

As you can see from the chart above, here are the common fees for trading:

  • ETFs: $4.95 flat rate per trade
  • Stocks: $4.95 flat rate per trade
  • Options: $0.50 per contract + $4.95 base rate
  • Futures: $1.50 per contract
  • Mutual funds: $20 flat rate per trade

If you need a broker to assist you in making trades, there is a $25 additional fee.

OptionsHouse Features:

  • Robust Platform for Stocks, Futures, and Options: the OptionsHouse platform is easy to navigate on all devices. You can trade, cancel, or modify orders with one click.
  • Free DRIP/Dividend Reinvestment: You can automatically reinvest dividends on all stocks and funds for free.
  • No Minimum Opening Deposit: You can open an OptionsHouse account without any initial deposit. Most brokers want a minimum of $1,000 to open an account.
  • Free Virtual Trading Account: When you first open an account, you can choose to open a separate account to trade virtual money.
  • Lots of Account Choices: Individual, Joint, Corporate, Traditional IRAs, Roth IRAs, SEP IRAs, UTMA, UGMA, Trusts, Partnerships, Investment Clubs, and Educational IRAs are all available.
  • Solid Customer Service: OptionsHouse offers phone, chat, and email support from 8am-8pm Monday through Friday.
  • Low Cost: As I already mentioned, OptionsHouse offers incredible value for investors looking to trade stocks and options.

OptionsHouse Drawbacks:

  • Limited After Hours Trading: Some brokerages allow trading until 8pm Eastern. OptionsHouse allows trades until 5pm Eastern.
  • IRA Closing Fee: Optionshouse charges $60 to close an IRA.
  • Mutual Funds: Mutual funds are $20 per trade, and there are a limited number of no load mutual funds available.
  • Cheap Stocks: If a stock trades below $2.00 per share, OptionsHouse charges an additional $.005 per share on the trade.
  • ETFs: OptionsHouse offers just five commission-free ETFs.

OptionsHouse Review Summary:

If you are looking to trade individual stocks or options, OptionsHouse is a solid choice. The pricing continues to be competitive, and the platform continues to improve.

Mutual fund and ETF investors will be disappointed at OptionsHouse and should look elsewhere – perhaps M1 Finance.

Summary
The Optionshouse brand no longer exists, and all existing accounts are being transferred to ETRADE. This is an unfortunate event because ETRADE charges higher commissions and fees while delivering little additional value.
Features7.6
Total Cost8.8
Ease of Use7.8
Customer Support6.2
Investment Options6.1
Strengths
Solid Trading Platform
Competitive Pricing
Weaknesses
Mediocre Customer Service
Terrible ETFs and Mutual Funds
7.3
Overall
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54 Comments on "OptionsHouse Review 2018"

avatar
ureminence
ureminence

Jacob:
I discovered your review while searching for Options House new platform reviews. As one who transferred an account from Scottrade due to their limited options for ‘options’, I would like to say that the current platform is best suited for those who have a separate technical analysis software program and simply want to place trades for a lower price.

Samantha
Samantha

Hi Jacob,

Which brokerage is best value if you want to have the ability to trade in extended hours?
Thank you.

Gary
Gary

If you are in a spread say 10 and -10 and you want to leg out is there an addition 4.95 every time you by back a contract or sell to re-balance?

Thanks
Gary

Clair Benward
Clair Benward

The platform also has significant automation capabilities, including trigger alerts that allow users to pre-populate orders; the platform then pushes an alert to the user when an event is triggered. Investors can then submit already-saved orders directly from the Web or via the OptionsHouse mobile app.

Rick
Rick

How long does it take to settle funds after a sell so you can buy again (stocks) on OH?

Thanks

Danielle
Danielle

Hi Jacob, please advise. All I want to do is buy occasionally buy more and more of the stock of one company. I don’t have much money, yet. I want to buy $100 of stocks from that company. What is the best way, and most affordable way to do that? And how much would that cost each time, total? Like including all fees? Bank account money transfer, etc. I don’t have a trading account anywhere.

Marine
Marine

Hi,
I am new to trading and after intense research I decided on OptionHouse because they were rated as the top user friendly for beginners. I don’t believe it to be true at this point. I have finally had my funds transferred and tried to purchase stocks yesterday but I kept getting a message that stated “rejected- buying power is insufficient for this order-check open orders”. I have more than enough funds in the account. What does this message mean and how do I go about purchasing? Please guide me.
Thanks

Al Rognlin
Al Rognlin
If you have any limit orders placed that have not yet triggered, Optionshouse will have set aside those funds – even though you’ve not yet bought the stock. So, you may have $1000 in your account but, you have ‘committed’ all or part of that $1000 in a limit order you’re waiting on to trigger. If your ‘live account value’ indicates less cash than you KNOW you have available for trading, something is wrong with Optionshouse accounting, which would be quite unusual. OR, you’ve committed part of your account value to a limit order which has not yet kicked in.… Read more »
ED
ED

What is the availability of stock to short with Optionshouse,seems Ameritrade never has any to short.