5 Best Options Trading Platforms of 2024 (2024)

Tastytrade, our top pick for options trading for 2024, is an options trader’s dream. The platform is lightning-fast and the workflow is super efficient. Analytics appear intuitively when and where they matter most and adjusting trades on the fly is a piece of cake. Don’t miss the videos and ideas from tastytrade’s corporate affiliate tastylive, as it’ll make you feel as if you have knowledgeable friends on the trading floor.

Charles Schwab’s thinkorswim platforms, available on both desktop and mobile, provide all that you could want for successful options trading and is easier on both eyes and brains compared to Interactive Brokers’ Trader Workstation. Strategy Roller enables clients to create custom rules and roll their existing options positions automatically.

-

For professionals, Interactive Brokers takes the crown as the best options platform. Its margin rates are outstanding. The trading platform, Trader Workstation, is exceptionally powerful, but is also one of the most challenging platforms to learn out of all the brokers we tested.

Our other winners also offer excellent platforms. Web-based Power E*TRADE is a bit friendlier to newer options traders, and the tools are well laid out. E*TRADE’s attention to detail shows in automatic spread groupings, effortless scanning in StrategySEEK, and easy-to-understand risk/reward data through tradeLAB.

Merrill Edge is our top recommendation for beginners, due to the ease of use of its options tools and because of Merrill's unique way of presenting stocks and ETFs through their "Story" formats. Its industry-disrupting Stock Stories make researching stocks an absolute joy for people who don’t live for financial statements. Some brokers offer more tools and others have quicker order entry, but for beginners looking for the whole package, Merrill makes the most sense to us.

Options trading involves buying and selling the rights to buy or sell securities at specific prices at certain dates. Picture betting on a sports game and being able to buy and sell that bet as the game progresses. That, in a nutshell, is how options trading works, though of course it’s a bit more nuanced than that. Option prices fluctuate on the price and volatility of their underlying investments and the time remaining until the options expire. Traders use options to speculate, reduce risk, or generate income.

Here's a summary of the primary options trading features offered by the best options trading brokers. See the end of this guide for a definition of each feature.

Here's a summary of the pricing for the best options trading brokers.

To practice options trading, choose an options trading platform that offers a free paper trading account. With paper trading, virtual money is used to place options trades in a simulated environment. E*TRADE, Charles Schwab, tastytrade, TradeStation, Webull, and Interactive Brokers all let you paper trade options.

Based on our testing and analysis, here are the best trading platforms for options in 2024.

• Tastytrade - 4 Stars - Best options trading platform and tools, great pricing
• Charles Schwab - 5 Stars - Industry standard thinkorswim platform, equity tools and research
• Interactive Brokers - 4.5 Stars - Best for professional options traders
• E*TRADE - 5 Stars - Best web-based platform and provides equity tools and research
• Merrill Edge - 4.5 Stars - Best for beginners

Merrill Edge is the best broker for first time option traders, thanks to a nifty tool called the Strategy Assistant. It walks you through choosing an option position step by step.

Instead of calling their revenue per trade “commissions,” many brokers charge per-contract fees (including some brokers who claim to have "zero commission" options trading). The exceptions are Robinhood, SoFi Invest , Firstrade and Webull, which charge no commissions or fees for options. Of these, we prefer Webull, which has a silky-smooth desktop platform.

A call option locks in the right to buy a stock (or other security) at a certain price (called the “strike”) until a specific date (the expiration). If the price goes above the strike price, then the call owner can buy the stock for the strike price and sell it for the market price. The premium is what the call buyer pays the call seller for this privilege. If the stock doesn’t rise above the strike price before expiration, the call buyer loses the whole premium. Investors can also sell call options to earn premiums. A contract usually represents a call on 100 shares of stock.

A put option locks in the right to sell a stock (or other security) at a certain price (called the “strike”) until a specific date (the expiration). If the price goes below the strike price, then the put owner can sell the stock for the strike price, which is higher than the market price. The premium is what the put buyer pays the put seller for this privilege. If the stock doesn’t fall below the strike price before expiration, the put buyer loses the whole premium. Investors can also sell put options to earn premiums. A contract usually represents a put on 100 shares of stock.

“0DTE” stands for “zero days until expiration.” These options are inexpensive because they have only a day or less before the option expires. They are also extremely speculative because, in the short term, stocks’ movements are close to unpredictable. We at StockBrokers.com think they are only suitable for highly sophisticated options traders.

You should have at least $5,000 that you are prepared to lose, and speculative options trading should only account for 10% of your portfolio. Though you can get started with as little as a few hundred dollars, that’s more or less rolling the dice. Experienced options traders maintain several positions at once that tend to offset risks, and that can’t be done with a few hundred dollars.

Yes. Options trading is a form of leveraged investing and thus is inherently risky. Any time an investor is using leverage to trade, they are taking on additional risk. Many times, this risk is unforeseen and not easily quantified.

On the most basic level, investors who buy a call or put option are only risking the money they invested in the contract. However, when selling a call or put, if the trade isn't protected (also known as going naked), the investor is taking on potentially unlimited risk.

As a protective measure, there are different options approval levels (usually four), and being approved requires an application through the online broker platform to unlock. The riskier the options strategy, the more demanding the requirement will become to be approved.

All of the best brokers for options trading offer the following features.

Sam Levine, CFA, CMT, the lead writer for StockBrokers.com, has over 30 years of investing experience and actively trades stocks, ETFs, options, futures, and options on futures. He's held roles as a portfolio manager, financial consultant, investment strategist and journalist. He holds the Chartered Financial Analyst (CFA) and the Chartered Market Technician (CMT) designations and served on the board of directors of the CMT Association.

Blain Reinkensmeyer, head of research at StockBrokers.com, has been investing and trading for over 25 years. After having placed over 2,000 trades in his late teens and early 20s, he became one of the first in digital media to review online brokerages. Blain created the original scoring rubric for StockBrokers.com and oversees all testing and rating methodologies.

For this guide:

• Whenever possible, we used our own brokerage accounts for testing. For several brokers, we used a test account that was provided to us.
• We collected more than 250 data points related to options trading across 17 brokers.
• We personally placed multiple options trades.

For this guide to the best platforms for options trading, our research team rigorously tested platform usability and quality of tools, such as options chains (e.g., optional views, total optional columns, streaming data quality, total Greeks offered), options analysis (e.g., P&L charts, calculators), and option position management (e.g., whether Greeks stream, rolling functionality, grouping availability, and advanced position analysis).

StockBrokers.com uses a variety of computing devices to evaluate trading platforms. Our reviews were conducted using the following devices: iPhone 12 Pro, iPhone 15 Pro Max, MacBook Pro M1 with 8 GB RAM running the current MacOS, and a Dell Vostro 5402 laptop i5 with 8 GB RAM running Windows 11 Pro. In testing platforms and apps, our reviewers place actual trades for a variety of instruments.

As part of our data check process, we sent a data profile link to each broker summarizing the data we had on file and the data they provided us last year, with a field for entering any data that had since changed. For the brokers that filled out these profiles, we audited the information for any discrepancies between our data and the broker’s data to ensure accuracy.

As part of our review process, all brokers had the opportunity to provide updates and key milestones in a live meeting that took place in the fall. Meetings with broker teams also took place throughout the year as new products rolled out. Insights gathered from these calls helped steer our testing efforts to ensure every feature and tool was assessed.

We tested 17 online trading platforms for this guide:

• Ally Invest review
• Charles Schwab review
• eToro review
• E*TRADE review
• Fidelity review
• Firstrade review
• Interactive Brokers review
• J.P. Morgan Self-Directed Investing review
• Merrill Edge review
• Public.com review
• Robinhood review
• SoFi Invest review
• tastytrade review
• TradeStation review
• Tradier review
• Vanguard review
• Webull review