Best Options Trading Platforms for December 2022

Options can be used to generate income, hedge your risk, or add more fuel to your portfolio by increasing your exposure to certain stocks and indexes. But because options trading is inherently more complex than simply buying stocks or funds, options traders often need to be more selective in choosing the right options trading platform. In the guide below, we'll share our top picks for the best options trading platforms and what you should look for when choosing an options trading platform.

TD Ameritrade

Best for: Experienced options traders in search of in-depth information

While TD Ameritrade isn't the cheapest platform for options traders, it is one of the most full-featured. Its thinkorswim desktop platform offers unparalleled trading tools and its mobile platform allows for even complex options trades on-the-go. Research from Credit Suisse and Morningstar also helps traders make informed choices. 

E*Trade

Best for: Active traders who want a powerful trading platform

Options trades are commission-free on E*TRADE although a standard $0.65/contract fee applies. While this fee makes E*TRADE costlier than some competitors, the brokerage does discount the rate to $0.50 per contract for active investors who make at least 30 options trades per quarter. E*TRADE also offers feature-rich trading tools, especially in its free Power E*TRADE platform which is beloved among options traders. 

Robinhood

Best for: Options traders looking for the most affordable solution

Unlike most competitors, Robinhood does not charge a contract fee for options trading. Since there's also no commission, this makes Robinhood the cheapest platform out there for trading options. While not the most feature-rich platform, Robinhood offers mobile trades so it's possible to buy and sell options contracts from all your devices. 

Ally Invest

Best for: Options traders with little money to invest 

Like most brokerage firms, Ally doesn't charge a commission fee for options trades. It does have a $0.50 per contract fee, which is cheaper than some alternatives out there. Ally has no minimum investment requirement and charges no maintenance fees, making it a great choice for options traders without a lot of money. 

TradeStation

Best for: Active traders interested in a full-featured desktop platform 

TradeStation offers a choice of different pricing structures for options traders, with TS Go users paying as little as $0.50 per contract and no commission. The TS Select plan costs a bit more at $0.60 per contract, but provides access to TradeStation's feature-rich desktop platform which justifies the added cost for active traders. 

Webull

Best for: Mobile users who want to trade options on-the-go

Webull is a great choice for options traders looking for the cheapest platform around. There's no per contract or commission fees, which sets it apart from most competitors. Webull also offers an intuitive, easy-to-use trading platform and especially shines with its feature-rich mobile software that can be used on all your devices. 

Interactive Brokers

Best for: Options traders with lots of money looking for a feature-rich platform 

Interactive Brokers charges a variable per contract fee for options trading, with the price based on the size of the trade. This makes it an ideal choice for investors with deeper pockets who can qualify for lower pricing. Its WorkStation platform is a powerful trading platform chock full of features that options traders will love. 

tastyworks 

Best for: Options traders looking for advanced technology at a low price

tastyworks is one of the only brokerage firms that is primarily geared toward options traders. It offers some of the industry's lowest costs for options trading, charging a commission only when opening a position. Its trading platform offers some of the best technologies designed by the team that pioneered retail options trading, making it an ideal choice for active traders. 

One key point to keep in mind is that there's no such thing as the best platform for options trading for everyone, and the costs and features should be weighed with your own preferences in mind before you open a brokerage account of your own.

For example, Robinhood has no commissions for options trades whatsoever, but its platform is very light on functionality and features, which makes it appropriate for investors who don't necessarily need educational resources and just want to dabble in basic call and put trades. On the other hand, an options broker like E*TRADE charges commissions, but is packed with features and resources which could be worth far more than the commission costs for many investors.

Options traders typically demand more of an options trading platform than people who are simply entering market or limit orders for stocks. Active option traders may prioritize options brokers based on their selection of calculators or screeners, whereas the infrequent options user may care about commissions alone.

Some features that may be considered "make or break" when picking the best platform to trade options are listed below:

• Commissions free options trading: While price isn’t everything, what you pay to make a trade ultimately plays through to your profit or loss. It makes very little sense to place a trade where the only likely winner is the brokerage firm. Commissions have come down quite a bit in recent years, and most of the best brokers for option trading offer commission-free trading on stocks as well, but there's still quite a bit of difference within the industry when it comes to options. Many of the best platforms for options trading have commission free options trading but may charge options trading fees per contract.
• Platform: Admittedly, an options trading platform often has more to do with personal preference than anything else, as placing a trade through any brokerage is usually a matter of a few clicks. Some traders may see TD Ameritrade’s full-featured thinkorswim platform as an asset, while beginning investors may see the complex interface as a liability. It's also important to note that some options brokers (like TD Ameritrade) offer a full-featured platform and an easier-to-use trading platform.
• Resources: Many of the best options brokers offer a full range of educational resources, which can be extremely valuable for investors who are new to options. As we mentioned, options can be very complex financial instruments and it is very easy to lose lots of money if you don't know what you're doing.
  

LEARN MORE: How to trade options

Commissions and fees for options trades can vary wildly even among the best platforms for options trading, and the difference can really add up. Here's a look at the costs associated with options trading, and how much our best brokers for option trading charge.

Commissions

Most of the best options brokers have eliminated flat-rate commissions for online stock and options trades, and just use a small fee for certain options traded. That means they offer commission free options trading, but charge a fee based on the number of options contracts traded. Thus, it costs more at most options brokers to trade 50 options contracts than it does to trade 10 options contracts.

The most common price point is roughly $0.65 per contract, although this can be between $0 and $1.00, depending on the stock options broker. Based on the typical fee of $0.65, to buy 10 contracts, a trader would pay $6.50 to make the trade ($0.65 × 10 = $6.50). To buy 100 contracts, the same trader would pay $65 in commissions to make the trade.

And to be clear, these are commissions for online options trades. If you conduct a trade by phone, the commission could be even higher.

The table below compares options trading platforms based on the cost to buy or sell 10 options contracts.

Options trading fee comparison for 10 contracts

Commission free options trading used to be a pipe dream for investors, but that's no longer the case with the best platforms to trade options slashing costs to attract and retain accounts. Here's an options fee comparison when trading 10 contracts for our top picks.

Options trading fees for exercise and assignment for exercise and assignment

Options brokers sometimes charge fees to buy or sell options, but some also charge fees if you want to exercise an option, or if an option you have sold is assigned.

• Exercise fees: Let’s say you own 100 call options on Nike at a strike price of $80. Nike rises to $85 per share by the expiration date, and you decide to exercise your right to buy the stock at $80 per share. A few options trading platforms will charge you a fee to exercise your options and buy the underlying stock.
• Assignment fees: Let’s say you sell a covered call on Nike at a strike price of $80. Nike rises to $85 per share by the expiration date, and the owner of the options decides to exercise them, paying you $80 per share for the underlying stock. A few options brokers will charge you an assignment fee for this transaction.

Most of the best options brokers don't charge these fees anymore. The exception is TradeStation, which charges $14.95 for both options exercise and assignment. If you don't plan on holding options until their expiration dates, this shouldn't necessarily be an issue, but it's still worth keeping in mind.

As mentioned before, most of the best options options brokers have commission free options trading, but do charge a small fee per contract traded. Robinhood and Webull are the few free options trading platforms that have 100% free options trading, both a $0 commission and no per contract fees for online trades. Robinhood and Webull also apply this same approach to stocks, ETFs, and cryptocurrency.

All options brokers on this list and most notable stock brokers offer many platforms from which to enact trades, including within a mobile app. Ultimately, the best apps for options trading will differ by user need, but here is a rundown of our picks of the best options brokers based on their app rating.

Robinhood, Webull, TD Ameritrade's thinkorswim, E*Trade, Tradestation, and Ally Invest are rated as some of the best investment apps overall by everyday users. But when it comes specifically to the best app to trade options, we think TD Ameritrade's thinkorswim, Robinhood, and E*Trade are top picks to consider with this narrowed focus. These are the best apps for trading options based on a number of factors, including overall user ratings, options trading fees, simplicity to use, and the overall capabilities of their mobile app compared to full-featured online experiences.