Options are among the most complicated investment instruments, and options trading belongs to the most complex trading and investment activities. Having a best broker for trading options at your hand is crucial for good trade executions and low cumulated fees.
In this eOption review, we will go through the pros and cons of one of the option trading platforms to help you find out whether it is the right choice for your trading needs and goals.
Designed as a robust commission-free stock, options, and funds trading platform, eOption provides traders with an intuitive and convenient direct access trading service that maximizes their experience. eOption was founded over 10 years ago and has supported thousands of options traders in their financial markets journey.
The platform is renowned for offering some of the lowest fees and the most flexible terms for traders looking to buy and sell options.
Active traders choose eOption because of the personalization capabilities of its web-based platform. It has a nice set of available trading tools, including news, charts, quotes, research features, watchlists, option chains, and more.
eOption’s team complements its solution also with an extensive set of educational materials, including blog articles, webinars, videos, and more.
In 2020 alone, the service provider has been deemed one of the best brokers for low-cost options trading by Investopedia, NedWallet, Benzinga, and other reputable financial sites.
|Category||Low-cost options trading broker|
|Features||Trading platform, option chain, multi-leg-trade tickets, charting, reporting|
|Technology||Browser-based application, mobile app|
|Commissions||$0.0 commissions, $0.10 contract fee|
|Price Details||Click here|
|Coupon Code||Not available|
|Paper Trading||Simulated $100,000 account|
eOption Trading Platform
It supports various options trading features, including easy order entries for single-leg and multi-leg option trades, a fully customizable screen layout, options chains, various order types, and more.
Joining eOption grants the trader free access to OptionsPlay, an advanced tool that eases the process of trading options. Among the features are daily historical analysis of stocks, advanced search for buy and sell signals, options trade ideas and strategies, and more.
The eOption platform is built on the white label software solution ETNA and tailored to the needs of eOption’s clients. This limits its features and functionalities and leaves it behind competing for online brokers like TD Ameritrade, for example.
One of the key advantages of eOption is the fact that it has a mobile app. The iOS and Android apps make trading on-the-go an easy and straightforward process. Most importantly, you won’t have to sacrifice any of the functionalities as Option Mobile gives you access to all your accounts. The mobile app supports stocks, ETF’s and options trades, streaming real-time quotes, market news, and charting. The integrated market data enables you to access financial research and trade options with no hassle.
For those who want to test-drive eOption before subscribing to it, there is a free 60-day paper trading account that unlocks all features and functionalities. The demo account gives you access to equity and options trading with $100,000 of virtual cash. If you want to give it a go, you can sign-up here.
eOption Autotrade Feature
The unique feature of eOption is the automated newsletter trading functionality. It allows you to automatically execute stock and option trades based on alerts from your newsletter.
So, how does Autotrade work? First, you will have to subscribe to a newsletter of your choice. After that, you authorize eOption to get into and out of trades based on the newsletter’s recommendations. Alternatively, you dedicate the trading process to the third-party stock and options recommendations, executed by eOption. However, you can also provide additional parameters and requirements at any time. These include choosing the maximum amount per trade, the number of traded contracts, the percentage of your account value, and more. That way, you ensure better control of your automated trades.
The list of supported newsletter publishers is available here.
To make it easier for the trader, eOption’s team has developed a series of educational videos explaining everything regarding the platform. From how to open an eOption account and set your layout to managing single- and multi-leg orders, charting, and P&L reporting, eOption’s YouTube channel features a variety of helpful content.
Before you decide to take advantage of the Autotrade feature, eOption recommends getting familiar with SEC’s guidance on the risks of automated trading.
With its low fee structure, eOption makes up to its users for the lack of trading platform functionalities.
The options contract fee is fixed at just $0.10 and a base rate of $1.99 per transaction. This makes it the most affordable options trading solution on the market for this type of options trade executions. For comparison, some of the competing trading platforms and brokers’ offerings start at $0.65 per contract.
Due to the fixed base fee, you can save more money if you generate high volume and purchase five or more contracts in a single transaction since the base fee remains the same.
Using the auto trade functionality leads to an increase of the base rate per trade from $1.99 to $3.99, but still with $0.10 commissions per contract.
Domestic stocks and ETFs can be traded commission-free.
However, the case is quite different when it comes to the rest of the eOption offers and commissions. For example, with foreign stocks, the fees are very high, reaching up to $39 per trade. This is way above the rest of the industry.
Also, eOption charges a $5 flat rate per mutual fund or bond (for the first 25) purchase.
IRAs are charged with a hefty $15 annual fee. Besides, a brokerage account that doesn’t trade at least twice per year is subject to a $50 inactivity fee.
eOption offers option traders margin at similar rates to the rest of the industry (between 7.75% and 4.75% APR).
Therefore, eOption is an excellent choice if you want to trade U.S. options, stocks and ETFs. For trading foreign markets, you should consider other brokers.
You can find more about eOption’s fees and rates here.
One close competitor to eOption is tastyworks. They charge $1 per contract and $10 max per leg without a base fee. So those who trade only 1 or two options contract at a time have lower costs using TastyWorks. for more details, please consider reading the tastyworks review.
Also, other brokers like Webull allow commission-free options trading with zero costs per contract. But please keep in mind that they are selling your order flow to third parties and receive payments for order flow in exchange. eOption sends your order directly to the exchange, and for this type of order routing, eOption has an excellent fee structure.
eOption Minimum Deposit
The best thing about eOption is that there is no account minimum requirement for US residents. This makes it one of the most beginner-friendly solutions on the market. That way, you can take advantage of low-cost stock and options trades even if you have limited capital.
For most brokerage service providers, the minimum deposit varies between $1,000 and $10,000, depending on the options level and the strategies. For example, in the case of TD Ameritrade, there is a $2,000 deposit requirement for options traders who want to be considered for margin and certain options privileges.
Besides, eOption doesn’t have any requirement on the amount of trading volume, which makes it a good choice for both beginners and day trading pros.
However, residents of selected countries are subject to a minimum account requirement of $25,000.
eOption Customer Service
The platform offers you two main methods to get in touch with the customer support team.
The first one is by phone (toll-free 1-888-793-5333 or 1-847-375-6151 for international calls). Customer service representatives are available Monday through Friday from 8 a.m. to 6:30 p.m. EST. However, bear in mind that eOption’s offices are closed on market holidays.
You can also contact eOption through firstname.lastname@example.org and a contact request form that you can find here. In most cases, you should expect to hear back from them in approximately one business day.
All-in-all, eOption does a great job on this front. The only downside is it doesn’t offer a live chat feature.
eOption Review Summary
We can go as far as saying that eOption is the best low-cost solution for the options trader. If cutting the commission fees is your primary objective, go with eOption, and you won’t regret it. Paired with the unique auto trading feature and the excellent overall service, the platform makes a strong case for your preferred broker.
However, this hardly is the case for functionalities, range of offerings, and fees for foreign stocks. It won’t satisfy the more advanced traders, who will have to complement eOption with another solution to make up for its shortcomings on the features front.
In the end, eOption isn’t trying to be the go-to platform for every investor. It has a well-specified target audience and does everything needed to serve it well.
As the name eOption suggests, this broker wants to be the best choice for options traders. And this is what the platform, features and fee structure is optimized for.
- Great low-fee options trading platform
- Zero fees on stock and ETF trades
- Low rates for margin trading accounts
- Unique automated newsletter trading feature
- No minimum account deposit requirement
- The mobile app mirrors the full capabilities of the web platform
- A paper trading account with $100,000 virtual money
- Limited in terms of trading functionalities
- High account fees and commissions for mutual funds, bonds, and foreign stocks
- Lacks support for forex and futures markets
- Falls short on the ETF and stock investing front
- It might be a bit complicated for beginners
- A minimum account requirement of $25,000 for international users
Frequently Asked Questions
- What is eOption
- Which option trading platform is best
- Do options have fees
- What is a per contract fee
- Where can I paper trade options
What is eOption
eOption is an online broker specialized in offering low-cost option trading for active traders. eOption does not sell order flow to 3rd parties and offers 0 commissions along with 10 cents fees per option contract.
Which option trading platform is best
Fast order executions and excellent fills make an options trading platform the best. A fast routing system is more important than any fee structure.
Do options have fees
Most online brokers like TradeStation still charge $0.60 commissions per contract. eOption offers $0 commissions for U.S. options. All brokers charge fees per contract since the options exchanges require to do so.
What is a per contract fee
The exchanges require brokers to pay a small fee for each option contract trade executed. The broker charges the client the exact same amount of fee per contract.
Where can I paper trade options
You can paper trade options with eOption. They provide a simulated paper trading account with $100,000 of paper trading capital.