Let’s take a look at a company that has quietly been making a name for itself in the discount brokerage industry. OptionsXpress is a multiple award winning broker that specializes in options trading for beginning and experienced traders. The company has slowly been building its market share over the past few years. Today, OptionsXpress is regarded as one of the best options brokers in the finance industry.
OptionsXpress is a subsidiary of OptionsXpress Holdings, Inc. The company has been operating as an online broker to options traders since 2000. OptionsXpress is based in Chicago, Illinois and offers a wide array of investment products for traders and investors alike. The company has consistently received high ratings from Forbes, Barrons, and Smart Money for its website, trading tools, competitive fees, and research information.
OptionsXpress Indvidual / Joint Account – The OptionsXpress general account is a standard cash account that can either be opened as an individual account or a joint account. OptionsXpress offers customers the ability to trade stocks, options, futures, bonds, exchange traded funds, and mutual funds. OptionsXpress users pay just $9.95 for each stock, bond, mutual fund, ETF trade and $14.95 per options contract. Margin accounts are also available.
Business and Trust Accounts – General accounts are available for business customers and corporate trust customers. Trusts are available in the following forms: Keogh, PSP, MPP, and Regular. The different types of business accounts available for registration are partnerships, investment clubs, corporate, and limited liability companies.
Retirement Investment Accounts – OptionsXpress offers a variety of IRA accounts for everyone from employees to small business owners. The Traditional IRA’s, Rollover IRA’s, Roth IRA’s, SEP IRA’s, and SIMPLE IRA’s are great for investors looking to build a diversified IRA portfolio..
OptionsXpress Options Contracts – Options trades cost $14.95 for traders that make less than 35 trades per quarter. The rate drops to $12.95 for traders that make more than 35 trades a month.
OptionsXpress Mobile Trading Platform – OptionsXpress has a mobile trading platform that allows you to trade from just about anywhere.
Advantages of OptionsXpress
No Minimum Opening Deposit
It costs absolutely nothing to open an OptionsXpress account. There are no account minimums and no minimum balances needed to keep the account open. There are very few brokers that do not require customers to fund their accounts with $500 or more. There are no maintenance fees or account inactivity fees.
OptionsXpress is loaded with tools to help the individual investor. The investor education section is particularly useful. The company offers webinars, tutorials, and workshops all free of charge. There are free live events, Q&A sessions, and analysis sessions. The comprehensive research center offers articles, newsletters, and a personal coaching session. There are research reports, analyst reports, market commentary, and proprietary analysis tools for investors. All of these tools will help traders formulate their options trading strategy. A lot of these great research futures are not available with other online brokers.
OptionsXpress has a great virtual trading platform that finds, analyzes, executes, and monitors your portfolio. The Screening tool screens investment opportunities based on your specific criteria. Once you have screened your options, the Strategy Scan tool analyzes your trade to detail the maximum gain and loss of your potential investment. The Xtend and Watch List tools execute your trading plan and monitor the performance of your investment.
A unique aspect of OptionsXpress is its futures trading products. Many brokers don’t offer futures trading options to everyday investors. On OptionsXpress, traders can buy and sell energy futures, metal futures, commodities futures, interest rates futures, and index futures.
OptionsXpress has a leg up on the competition with its customer service. The company offers free broker assisted trading which is a rarity in the brokerage industry. Some brokers charge as much as $30 for live assistance from a broker.
Disadvantages of OptionsXpress
While the trading fees are low; they are not as low as some other brokers. It costs $9.95 to trade stocks, bonds, mutual funds, and ETF’s. Competitors like TradeKing, OptionsHouse, and FirstTrade have lower fees on these trades. Trading options is cheap but you can find cheaper options trading from other option brokers though the difference is fairly insignificant. Personally, I think OptionsXpress more than makes up for it with the other great services it provides above and beyond what its competitors offer.
How OptionsXpress Works
Opening an OptionsXpress account is an easy process. You can open your account in under 5 minutes:
- Select the name and type of account that you would like to open.
- Create your profile by entering your name, address, social security number, date of birth, and employer’s name and address.
- Agree to the terms and conditions.
- Sign the account forms and mail them in.
- Fund your account via ACH, check, account transfer or wire transfer.
I am convinced that OptionsXpress is one of the best brokers available for options traders. Inexperienced and experienced traders can both easily navigate the OptionsXpress site. The site is easy to use and has everything that the options investor is looking for. The futures trading platform is a bonus and is useful for the speculative investor. The educational center is great for beginning investors because they can gain a better understanding of the different types of options strategies available. The trading tools, research reports, and customer service helps to set OptionsXpress apart. On top of all of this, they offer the basic stock, bond, and ETF investing services that your average broker would offer.
The only potential drawback is the pricing. The company may be best of breed but it is not the lowest cost option in the industry. Traders looking for the cheapest broker without much care for other services should look elsewhere, including competitors like TradeKing and OptionsHouse. All in all OptionsXpress is a real bargain when you consider the plethora of information and tools that you get for the price.
Do you have any direct experience with OptionsXpress. Any feedback on their services is always welcome!