OptionsXpress offers a vast library of educational resources to help the beginner learn how to trade and it doesn’t charge for broker-assisted trades. It also has plenty of tools to help you find more trading ideas.
However, it can be a little more expensive than its competitors…especially for high-volume options traders.
Overall, OptionsXpress is a great way to buy and sell options, futures, individual stocks, ETFs and mutual funds. In this review, we’ll break down it’s main characteristics.
Brief Overview
OptionsXpress was originally an independently owned company. But it was bought out by Charles Schwab in 2011.
It’s primarily aimed at options and futures traders. But you can still use it to buy other assets as well.
In the past, OptionsXpress was known for their ultra-low commissions for active traders. They had no base fee and offered a discount to customers who traded more than 35 contracts per quarter.
However, most options brokerages have now switched to a per-trade pricing structure. And OptionsXpress has joined the crowd in this respect.
As a result, they are no longer especially cheaper than their competitors for customers that do a lot of trades.
OptionsXpress might be shut down at some point in the future and merged with Charles Schwab completely. So this should be kept in mind if you are going to be using the service for a while.
But if you like it, at least you can enjoy it while it lasts.
Who Should Consider It?
OptionsXpress offers a lot of tools not available elsewhere.
For example, their “walk limit” order type prevents you from having to alter your order if it isn’t filled right away. This can sometimes get you a better price than you would receive otherwise.
They also have an “idea hub” that provides you with trading ideas from five different categories. This can help in those moments when you’re “stuck” and don’t know what to trade.
In addition, they have a very useful trade-calculator that can tell you the probabilities of various profit/loss outcomes.
If you want a platform with more features, OptionsXpress might be the site for you.
OptionsXpress also might be the site for you if you like to trade penny stocks or futures, since many other options platforms do not offer these assets.
On the other hand, OptionsXpress charges $0.65 per contract to trade options instead of the $0.50 charged by OptionsHouse.
If you make mostly low-volume trades, this may not matter to you.
But if you make trades that are very large, the extra 15 cents can significantly eat into your profits. So in this case you may want to stay away from OptionsXpress.
Likes and Dislikes
Likes:
- Paper trading available with $25,000 of play money.
- Downloadable platform is fast and easy to use.
- Walk-limit order type eliminates the need to update an options order before being filled.
- Idea Hub and Strategy Scan help to find trade ideas.
- All-in-one trade ticket allows any asset to be traded from one screen.
- No monthly or annual fee to use the trading platform.
- No extra fee for broker-assisted trades.
- Provides some ETFs commission-free.
Dislikes:
- $0.65 per contract commission discourages high-volume trades.
- Web-based platform cannot be customized.
- Despite being owned by Charles Schwab, doesn’t allow one-click access to a CS account.
- Will probably be shut down. So it may be better to go straight to Charles Schwab.
Investment Offerings
Individual stocks can be traded for $4.95 per trade. This is better than many traditional stock-brokers charge.
It offers an assortment of exchange-traded funds. And it has an ETF screener tool that can be used to search for ETFs based on the criterion the user enters.
Mutual funds can be bought for $9.95 plus the load fee. But many of OptionsXpress’ mutual funds are no-load.
For the investor that wants to diversify into fixed-income securities, OptionsXpress offers a wide assortment of government and corporate bonds at a $5 per bond commission with a $9.95 minimum.
For traders who want to, OptionsXpress allows you to participate in the 24-hour a day, five day a week futures market.
A lot of options-trading platforms don’t offer “pink sheet” stocks, often called “penny stocks”. But OptionsXpress does.
Last but not least, OptionsXpress offers options trading for $4.95 per trade plus $0.65 per contract.
Fees
As I mentioned earlier, the main thing OptionsXpress was known for in the past was the fact that it gave a discount to options traders who traded more than 35 contracts per quarter. This allowed them to attract day-traders, scalpers, and others who tended to be “active traders”.
This is no longer the case. But OptionsXpress’ fees are still lower for most traders than they were in the past.
There is now a $4.95 fee tacked onto each trade. But whereas options contracts used to cost $1.25 for active traders, they now cost only $0.65 for everyone. For most traders, this leads to lower fees over the course of a quarter when compared to the past.
However, OptionsXpress’ competitors have gone further than them in slashing prices.
For example, OptionsHouse charges the same $4.95 fee per trade but only $0.50 per contract. So OptionsXpress is still slightly more expensive when compared to its competitors.
Platforms and Trading
The OptionsXpress web-platform is very easy to use. Charts can be created by mousing over the “quotes” pull-down menu and clicking on “basic charts”.
When you’re ready to trade, just mouse over “trade” and click on “all-in-one trade ticket”. It doesn’t matter which asset you are trying to trade…they can all be bought or sold from the same window.
The web-platform also has a nice, clean white design that’s easy on the eyes. This helps prevent fatigue during those marathon trading sessions when you just can’t bring yourself to stop.
The only problem with the web-based platform is that it is not customizable. This can be a problem if you want to watch several charts at the same time.
In addition to the web-based platform, OptionsXpress offers a downloadable client called “Xtend”. This software is fully customizable.
By default, Xtend opens with an “options chain” window in the top-middle of the screen. Type in a symbol and it will give you a list of the put and call options available, along with their strike prices.
By default, the Xtend software also opens up with four other windows: the watch list (upper-left), quote details (lower-left), balances (upper-right), and positions (lower-right).
These windows can be moved around to wherever you want them to be…until it suits your personal trading style completely.
Mobile Platform
Options Xpress offers a mobile client called “oX” for iPhone, Android, and Kindle. It has a white and blue design and opens with four tabs: Indices, Movers, News, and IdeaHub.
Overall, the oX mobile platform makes trading on-the-go pretty easy.
Other Features
Walk Limit: The walk limit order allows the computer to automatically update your order until it is filled. Because this is so much faster than doing it manually, it can often allow you to get a better price than you would get otherwise.
IdeaHub: Have you ever opened up your trading software and just stared at the screen, wondering what to do? Sometimes, trading ideas don’t come so easily. That’s where IdeaHub helps.
Trading Patterns: The Trading Patterns feature analyzes the top stocks traded today by OptionsXpress customers.
Xspreads allows you to see the “spread order book” of OptionsXpress itself.
Strategy Scan: Another idea-generating tool, Strategy Scan gives you strategies to trade based on a symbol, time-horizon, direction, trading level, and investment risk.
Educational Materials
One of the best features of OptionsXpress is its robust library of educational materials. It has courses that teach how to trade each asset.
In addition to these on-demand resources, OptionsXpress also offers live webinars and workshops.
Customer Support
Luckily, OptionsXpress has a reputation for quality customer service.
They have phone support Monday-Friday 9 a.m. To 8 p.m. EST. And if you don’t like talking on the phone, they have live chat and e-mail support as well.
OptionsXpress Review Final Verdict
Overall, OptionsXpress is a great choice for beginners or for traders who want a robust suite of tools to use in making their trading decisions.
It has a great educational section, easy-to-use software, and plenty of features to help traders generate ideas.
But for traders who are not interested in these features, they may want to check out other platforms such as Trade Monster, Trade Station or Options House.