OptionsHouse Review – The Pros and The Cons

Review of: Optionshouse

Reviewed by:
Rating:
4
Last Updated: July 29, 2016

Summary:

If you are looking to buy an individual stock or ETF, you'll have a difficult time finding a more budget friendly brokerage firm.

I’ve been a long-time user of the Optionshouse platform, which led me to write this Optionshouse review.

I first opened up an Optionshouse account more than 4 years ago. The platform was actually relatively new back then, and was causing quite the uproar in the online brokerage space due to the low pricing.

At the time, most online brokerages were charging $10 or more in commissions per trade. Some were still attempting to get up to $40 per trade. (Crazy!)

Optionshouse introduced low-cost trades for less than $5, and really put downward pressure on the price of online brokers. Their decision to offer low-cost, high-quality brokerage services resulted in a definite win for individual investors like you and I.

In addition, they built a nice platform and rolled out several free features. This resulted in being the top Barron’s Options Trading platform for a few years running (source).

Optionshouse Review

Optionshouse Fees:

This is the draw for Optionshouse, and the primary reason I chose to use them in the first place. Fees are still dirt cheap here when compared to other brokerage firms.Optionshouse fee comparison

As you can see from the chart above, here are the common fees for trading:

  • Stocks and ETFs: $4.95 flat rate
  • Options Plan: $0.50 per contract + $4.95 base
  • Mutual funds: $9.95 flat rate

In addition, there are no real fees associated with having an account and you don’t have to maintain a minimum balance. If you need a broker to assist with trades, there is a $25 additional fee.

Optionshouse Review Pros:

  • Low Cost: As I already mentioned, Optionshouse is still the lowest price firm offering individual stock trades.
  • Tons of available accounts: Individual, Joint, Corporate, Traditional IRAs, Roth IRAs, SEP IRAs, UTMA, UGMA, Trusts, Partnerships, Investment Clubs, and Educational IRAs are all available.
  • Good Customer Service: I’ve had good results with their phone support service, and the representative on the other end actually knew enough to be helpful. Email and online chat can be tedious, which seems to be the case anywhere these days. Overall, they are available to talk if you need help with anything, but some readers have mentioned long wait times.
  • Free Virtual Trading Account: When you first open an account, you can choose to fund a virtual account. Yes, it’s like monopoly money and you can spend it however you want. It’s not terribly useful, but I thought it was fun to use before I had any real money to spend.
  • Free DRIPs/Dividend Reinvestment: You can automatically reinvest dividends on all stocks and funds for free. This is a really nice feature.
  • Platform Usability: I find the platform fairly easy to navigate and use. It’s not difficult to search, make a trade, etc.
  • Free Streaming Quotes: This isn’t groundbreaking but some brokers charge for it.
  • Low Minimum Opening Deposit. It only costs $1,000 to open a standard OptionsHouse account.

Optionshouse Review Cons:

  • Mutual Funds: The price is fine at just under $10, but I wouldn’t use the service. They offer a limited number of no load mutual funds that really needs improved upon. Beyond that, all mutual fund transactions must be made over the phone. If you want to trade mutual funds, open an account at Vanguard for free. You will be much better off.
  • Research and Charts: The information available to the investor is very limited on Optionshouse. They don’t offer hardly any research and the charting is very limited. I wouldn’t expect much here.
  • Cheap Stocks: If a stock trades below the $2.00 price point then you’ll need to add an additional $.005 per share on the trade. Shouldn’t matter much unless you’re looking for really cheap stocks.
  • Limited After Hours Trading: Some brokerages allow trading until 8pm Eastern. Optionshouse allows trades until 5pm Eastern.
  • Funding Period: If you add money to your brokerage account, the transfer usually takes 3 business day. People love to complain about this but I don’t really see the big problem. This time frame is fairly common for financial transactions. Regardless, you shouldn’t expect immediate trades.

Optionshouse Review Summary:

If you want to buy a few individual stocks or ETFs for your portfolio, Optionshouse is probably your cheapest option. They offer a great service for the pricing. Not perfect, and not a one stop shop for me, but a good brokerage platform to have and use.

Right now, OptionsHouse is offering a limited time deal to our readers – free trades for the first 60 days after funding and opening an account.

If you’re interested, grab an OptionsHouse Account with your free 60 day trade offer.

What’s your take on my Optionshouse review? Have you used the service?

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