optionsXpress Review: How This Online Broker Makes Advanced Trading Easy

optionsXpress review

If you’re looking for a more hands-on trading experience, an online broker might be the right option for you.

A number of online discount brokers can help you trade stocks and other investment products, including options and futures. If you’re an advanced trader looking for more variety in your portfolio, a broker such as optionsXpress could be a good choice.

optionsXpress review

Thanks to the internet and new technology, just about anyone can open an online investing account. But for investors hoping to access a wider variety of trading products and who want more control over their portfolios, optionsXpress could be their best bet.

The broker was acquired by Charles Schwab a few years ago, so optionsXpress has the backing of a respected and well-known brokerage. However, the acquisition hasn’t changed the fact that optionsXpress offers access to trading opportunities that some consumers may consider “exotic” — options and futures.

This optionsXpress review will walk you through what you need to know about the broker so you can decide whether it’s right for you.

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Who optionsXpress is best for

This is not a platform for beginners. The optionsXpress platform offers robust trading for medium to advanced traders. If you’re interested in trading options, futures, or individual stocks, this platform could be a smart choice.

For the most part, optionsXpress is best for confident traders who have a good handle on their finances and have the risk tolerance to manage the potential losses that come with options and futures — especially when trading on margin.

However, if you’re a beginner who wants to learn about trading options and futures, optionsXpress offers great educational and practice resources. Just make sure you develop strategies and confidence before risking your own money.

While optionsXpress offers more than 200 Schwab commission-free ETFs, its mutual funds are not as competitive. The broker charges $9.95 per mutual fund trade. So for investors looking to minimize fees, be sure to comparison shop.

Accounts you can open with optionsXpress

You can open just about any type of investment account with optionsXpress. The company offers individual and joint investment accounts, as well as trust or business accounts. On top of that, you can open any type of IRA account you’re interested in.

Finally, optionsXpress has custodial accounts if you want to invest on behalf of a minor. You can even open a Coverdell or IRA on behalf of a child with the help of this platform.

Trade stocks, funds, options, and futures

The broker made a name for itself by offering options and futures. However, it’s also possible to trade stocks, mutual funds, and ETFs using optionsXpress.

Until recently, optionsXpress charged a little bit more for stock transactions. However, in recent years, the company has dropped its stock commission to be more competitive with other online brokers. You can learn more about optionsXpress fees below.

Meanwhile, optionsXpress offers nearly 5,400 no-load mutual funds. That makes it easier for investors to consolidate funds and diversify their portfolios.

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optionsXpress features and tools

Make virtual trades

When trading options and futures, make sure you understand what you’re doing. In general, options and futures are considered a little riskier than stocks and mutual funds.

Before you risk your own money, practice on the company’s virtual trade account. You get $25,000 in virtual money to experiment with and get a feel for how the platform works. You can also try different strategies and practice with options so that you can see what happens in different scenarios.

Image via optionsXpress

Master the Xtend trading platform

The Xtend trading platform allows you to see real-time quotes and track your positions. It is customizable, allowing you to choose what information is front and center. Use Xtend to create watch lists, as well as view the latest news about different companies.

Use an all-in-one trade ticket

One of the best tools available with optionsXpress is the all-in-one trade ticket. This feature allows you to call or put, as well as double-check pricing and use a trade calculator to see where you stand.

Image via optionsXpress

Research with the trade and probability calculator

Before you place an order, you can sound out your strategy with the help of the trade and probability calculator. It’s possible to change details like options expiration date, volatility, and investment amount.

Stay up-to-date with streaming charts

If you’re interested in technical trading, the streaming charts feature can be a great help. You can see a detailed, up-to-the-minute view of the market. Easy navigation allows you to move to other areas of the site or pull up more information if you want it.

Image via optionsXpress

Monitor option chains

With options, you might see different legs in the trade. With options trading, your exit strategy matters just as much as your entry. With option chains, you can see real-time quotes for each leg of the different strategies available.

Expand your knowledge

When you’re building an investment portfolio, it pays to be in the know. One of the biggest advantages offered by optionsXpress is its vast educational library.

The education center includes basic information on trading, such as options and futures trading. You can also watch helpful videos and get access to market commentary.

Take advantage of webinars and workshops

Want more help? optionsXpress provides introductory webinars and outlook commentary so you can learn about different strategies. You can even attend workshops at Charles Schwab locations, where you can network with other traders and explore investment selection tools.

Use the optionsXpress mobile app

Take optionsXpress with you wherever you go; the mobile interface is easy to use and offers many of the same functionalities that you see with the online trading platform.

Image via optionsXpress

optionsXpress mobile trading is available for Apple and Android devices. While you can’t get exactly the same charting with mobile, you can still get real-time quotes and place trades.

The all-in-one ticket is available on the mobile app, making it easy to accomplish your trades no matter where you are.

optionsXpress fees

No optionsXpress review is complete without covering the fees. In order to bring the commissions in line with other discount brokers, optionsXpress recently dropped its base fee for stock and ETF trades to $4.95.

The company also dropped its options cost to $0.65 per contract, on top of the base. optionsXpress also offers penny options for a $4.95 flat rate when you trade between one and 10 contracts. If you trade more than 10 contracts, it reverts to a rate of $0.50 per contract.

Futures contracts are available for $3.50 per contract. You can also purchase bonds for $5.00 per bond, with a $9.95 minimum order.

Mutual funds cost $9.95, plus a load fee. However, it may make sense to look for no-load funds so you can avoid paying the load. You will still have to pay the expense ratio on top of other fees for trading mutual funds.

Finally, optionsXpress allows you to trade on margin. Rates start at 6 percent for accounts of $1 million or more, and rise up to 8.25 percent for smaller accounts. You can open a margin account even if you don’t fund it immediately.

How to open an optionsXpress account

If you have a Schwab online trading account, you can access the optionsXpress platform with the same information. Otherwise, you will need to open an account. It’s a fairly straightforward process and it doesn’t take long.

However, due to the options and futures trading, you will need to read and sign additional waivers and provide extra information about your net worth and income so that you can be approved for a margin account, if that’s what you want.

Image via optionsXpress

Start by deciding what kinds of features you want in your account. You need to choose whether you want margin, and if you want to trade options and futures. Next, set up a login and password so you can come back later if you need to gather more information.

Once you have created your account, you will be asked to provide information about your level of expertise and your goals for the account. This includes what you hope to accomplish in terms of growth or income; you can even use the account for speculation.

You then need to provide information about your finances. optionsXpress really gets into specifics to understand your financial situation before you can open an account.

This is because the investment products offered are complex. Plus, when you are granted a margin account, it’s like getting credit. Your margin account will be based on your income and other information.

Image via optionsXpress

Other information you need to sign up for optionsXpress is similar to what you provide to open other financial accounts:

  • Address
  • Birth date
  • Social Security number
  • Employer name and address
  • Bank account information
  • Whether you have a large stake in another company

You are also required to verify your identity online. You will provide verifying details related to your credit past. You might be asked about a cosigner on a loan, a past address, or some other information.

Finally, you need to provide information about your bank account so you can fund your optionsXpress account. The broker offers a variety of possibilities for funding, including wire transfer and ACH transfer.

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optionsXpress contact info and customer service

Have questions that weren’t addressed in this optionsXpress review? The company offers a number of contact options if you need to get in touch.

Live chat is available Monday through Friday, 8:30 a.m. to 8 p.m. EST. You can also send an email using an online form on the website.

Phone support is available when you call (888) 280-8020, Monday through Friday, 9 a.m. to 8 p.m. EST.

Connect with optionsXpress on Twitter and Facebook.

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