An options broker or options trading broker refers to a brokerage firm which provide a software or web-based interface (also called options trading platform) that allows investors and traders to execute trades on options contracts.
Options are financial derivatives that give the holder the right, but not the obligation, to buy or sell an underlying asset, such as a stock, at a specified price on or before a certain date.
In this article, we have grouped the best brokers for trading options.
- The overall quality of the broker
- The commissions charged on the brokers’ options
- The options investment methods offered
Round-Up
Warning
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
| Broker | Options available |
|---|---|
| Fineco | Knock-out |
| DEGIRO | Knock-out |
| Interactive Brokers | Vanilla, Knock-out |
| Plus500 | Vanilla |
| IG Markets | Vanilla, Knock-out, Digital 100 |
| Saxo | Vanilla |
| AvaTrade | Vanilla |
| easyMarkets | Vanilla |
| CMC Markets | Vanilla |
What are the best options trading brokers?
Below our curated list of the best brokers and platforms for options trading, with details of features and characteristics.
Fineco
Finedo enables trading options on IDEM, EUREX, and CBOE markets. Fineco offers Knock-out options on indices, commodities, forex, and cryptocurrencies, with leverage up to 1:100. Fineco imposes commissions starting at €1.95 per lot.
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About Fineco
Fineco is an Italian online bank and broker founded in 1999, offering trading services on stocks, ETFs, bonds, futures, options, forex, and CFDs. Fineco provides proprietary web and mobile trading platforms. Fineco is regulated by multiple authorities including Banca d’Italia and CONSOB. Fineco is known for its integrated banking and investing services, competitive pricing, and extensive product range. Fineco serves over 1.4 million clients primarily in Italy and the UK. The Fineco CEO is Alessandro Foti since 2000.
Fineco Features
The features of Fineco are listed below.
- Fineco offers the ability to trade options on the IDEM, EUREX, and CBOE markets.
- The options offered by Fineco are Knock-out, and are available on Indices, commodities, forex, and cryptocurrencies.
- The leverage offered by Fineco goes up to 1:100.
- Options trades on Fineco can be held for up to a maximum of 30 days.
- Commissions on options loaded by Fineco start at €1.95 per lot traded.
Fineco Pros and Cons
Advantages of Fineco
The advantages of Fineco are listed below.
- No Minimum Deposit Requirement
- Competitive Trading Fees
- Diverse Range of Tradeable Assets
Disadvantages of Fineco
The disadvantages of Fineco are listed below.
- Lack of a Demo Account
- Limited Educational Resources
- Higher Spreads Compared to Competitors
DEGIRO
DEGIRO allows trading over 40,000 stock market options. DEGIRO requires an Active or Trader account. DEGIRO charges commissions starting at €0.75 per contract. DEGIRO does not provide a demo account.
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About DEGIRO
DEGIRO is a European online broker founded in 2008, whose CEO is Oliver Behrens. DEGIRO offers access to over 50 global exchanges for trading securities like stocks, ETFs, bonds, options and futures. DEGIRO offers low fee structures, user-friendly platforms, and a AFM regulated investing environment.
DEGIRO Features
The features of DEGIRO are listed below.
- DEGIRO allows you to trade over 40,000 options on the stock market.
- To access options trading, you must open a DEGIRO Active account or a DEGIRO Trader account.
- Commissions charged by DEGIRO on options start at €0.75 per contract.
- DEGIRO does not offer a demo account, but you can open an account starting at €0.01.
DEGIRO Pros and Cons
Advantages of DEGIRO
The advantages of DEGIRO are listed below.
- User-Friendly Platform
- Low and Transparent Fees
- Wide Range of Investment Options
Disadvantages of DEGIRO
The disadvantages of DEGIRO are listed below.
- No Direct Cryptocurrency Trading
- Lack of a Demo Account
- Limited Educational Resources
Interactive Brokers
Interactive Brokers offers options trading on over 30 markets. Interactive Brokers charges commissions from $0.15 to $0.65 per contract. Interactive Brokers provides options on forex, stocks, commodities, and bonds.
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About Interactive Brokers
Interactive Brokers is a global electronic broker founded in 1978, offering trading in stocks, options, futures, forex, bonds, ETFs, and cryptocurrencies across 150 markets in 33 countries. Interactive Brokers provides advanced trading platforms, low commissions, and access to a wide range of financial instruments. Interactive Brokers is known for its sophisticated technology and serves both retail and institutional clients. Interactive Brokers is regulated by multiple top-tier authorities worldwide. The CEO of the Interactive Brokers Group is Milan Galik.
Interactive Brokers Features
The features of Interactive Brokers are listed below.
- On IB you can trade options on more than 30 markets.
- Commissions on IB options start at $0.15 but can go as high as $0.65 (per contract) depending on trading volume.
- IB offers options on forex, stocks, commodities, the stock market, and bonds.
Interactive Brokers Pros and Cons
Advantages of Interactive Brokers
The advantages of Interactive Brokers are listed below.
- Low Trading Fees
- Advanced Trading Tools
- Wide Market Access
Disadvantages of Interactive Brokers
The disadvantages of Interactive Brokers are listed below.
- Not user-friendly
- No MetaTrader Support
- Additional Fees
Plus500
Plus500 provides access to more than 200 options as CFDs. Plus500 includes markets like stocks, commodities, forex, and stock indices. Plus500 applies variable spreads depending on market conditions.
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About Plus500
Plus500 is a global fintech company founded in 2008, offering online Futures trading services in different markets such as Agriculture, Cryptocurrencies, Metals, Commodities, Forex, Interest Rates, Energy and Equity Indices. Plus500 provides proprietary web and mobile trading platforms. Plus500 is regulated by multiple top-tier authorities including FCA, ASIC, and CySEC. Plus500 is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index. The Plus500 CEO is David Zruia since April 2020.
Plus500 Features
The features of Plus500 are listed below.
- Plus500 offers more than 200 options as CFDs.
- Markets offered by Plus500 on options include the stock market, commodities, forex, and stock indices.
- Plus500 allows you to use levers up to 1:5 on stocks.
- With Plus500, options trading includes a variable spread depending on the market situation.
Plus500 Pros and Cons
Advantages of Plus500
The advantages of Plus500 are listed below.
- Well-regulated CFD provider
- Over 2000 tradable CFDs
- Unlimited demo account offered
Disadvantages of Plus500
The disadvantages of Plus500 are listed below.
- Limited Regulatory Protections for Professionals
- Inactivity fees
- Limited deposit methods
IG Markets
IG Markets facilitates trading Barrier and Vanilla options. IG Markets offers options on forex, indices, stocks, and commodities. IG Markets applies variable fees linked to market spread.
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About IG Markets
IG Markets is a global online trading provider founded in 1974, offering access to over 17,000 financial markets including forex, stocks, indices, commodities, and cryptocurrencies. IG Markets provides proprietary trading platforms alongside MetaTrader 4 and ProRealTime. IG Markets is regulated by multiple top-tier authorities worldwide, including the FCA and ASIC. IG Markets is known for competitive spreads, extensive educational resources, and innovative features like weekend trading. The IG Markets’ parent company “IG Group” CEO is Breon Corcoran.
IG Markets Features
The features of IG Markets are listed below.
- IG Markets allows you to trade Barrier and Vanilla options.
- Options markets offered are on forex, indices, stocks, and commodities.
- Options on IG Markets charge variable fees corresponding to the market spread.
- For clients who classify themselves as professionals, IG Markets also allows trading of Digital 100 type options, i.e. binary options.
IG Markets Pros and Cons
Advantages of IG Markets
The advantages of IG Markets are listed below.
- Low spreads from 0.6 pips on Forex
- Wide range of financial instruments
- 40 years of experience in the Forex industry
Disadvantages of IG Markets
The disadvantages of IG Markets are listed below.
- No copy trading features
- No social trading features
Saxo
Saxo allows trading vanilla options on over 20 markets. Saxo covers forex, stocks, and commodities. Saxo offers over 2100 options, with commissions starting at $1.50 per contract.
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About Saxo
Saxo is a Danish investment bank and online trading platform founded in 1992. Saxo offers trading in forex, stocks, CFDs, futures, options, and other financial instruments across global markets. Saxo provides proprietary trading platforms and white-label solutions for institutional clients. Saxo is regulated by multiple authorities including the Danish FSA and UK FCA. Saxo serves retail and institutional clients in over 170 countries. The Saxo CEO and co-founder is Kim Fournais.
Saxo Features
The features of Saxo are listed below.
- On Saxo it is possible to trade vanilla options on more than 20 markets, including forex, stocks, and commodities.
- The total number of options available on Saxo is over 2100.
- The exchanges offered by Saxo to trade options are IDEM, EUREX, OPRA, and Euronext.
- Options commissions start at $1.50 per contract.
Saxo Pros and Cons
Advantages of Saxo
The advantages of Saxo are listed below.
- Regulation and Trust
- Extensive Product Range
- Advanced Trading Platform
Disadvantages of Saxo
The disadvantages of Saxo are listed below.
- High Minimum Deposits for Premium Accounts
- Lack of Spread Betting Options
- Custody Fees in Certain Regions
AvaTrade
AvaTrade supports trading vanilla forex options. AvaTrade fixes spreads on options. AvaTrade provides 40 forex options, accessible via the AvaOption app.
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About AvaTrade
AvaTrade is a global forex and CFD broker founded in 2006 and headquartered in Dublin, Ireland. AvaTrade offers trading on currencies, commodities, indices, stocks, bonds, ETFs, and cryptocurrencies. AvaTrade provides proprietary platforms alongside MetaTrader 4 and 5. AvaTrade is regulated by multiple authorities including CySEC, ASIC, and FSA. AvaTrade serves over 300,000 clients worldwide. AvaTrade is known for competitive spreads and extensive educational resources. The AvaTrade CEO is David Dryzin since 2016.
AvaTrade Features
The features of AvaTrade are listed below.
- AvaTrade allows you to trade vanilla forex options.
- Spreads on AvaTrade options are fixed.
- A total of 40 forex options are available.
- Options trading is done on the AvaOption app.
AvaTrade Pros and Cons
Advantages of AvaTrade
The advantages of AvaTrade are listed below.
- Tight fixed spreads from 0.6 pips (0.9 pips for retail traders)
- The mobile apps are well designed
- Can be connected to ZuluTrade and Duplitrade
Disadvantages of AvaTrade
The disadvantages of AvaTrade are listed below.
- High inactivity fees
- The demo account is limited to 30 days
EasyMarkets
EasyMarkets makes available vanilla options on forex, gold, and silver. EasyMarkets excludes swap commissions. EasyMarkets enables trading over 100 forex pairs as options.
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About EasyMarkets
EasyMarkets is a global forex and CFD broker founded in 2001, offering trading on currencies, commodities, indices, cryptocurrencies, and stocks. EasyMarkets provides proprietary web and mobile platforms alongside MetaTrader 4 and 5. EasyMarkets is regulated by multiple authorities including CySEC and ASIC. EasyMarkets is known for innovative features like dealCancellation and fixed spreads. EasyMarkets serves clients worldwide and has received numerous industry awards. The EasyMarkets CEO is Nikos Antoniades.
EasyMarkets Features
The features of EasyMarkets are listed below.
- easyMarkets offers vanilla options trading on forex, gold, and silver.
- Options offered by easyMarkets do not charge swap commissions.
- There are over 100 forex pairs available to be traded as options.
EasyMarkets Pros and Cons
Advantages of EasyMarkets
The advantages of EasyMarkets are listed below.
- Innovative Risk Management Tools
- User-Friendly Platform
- Regulatory Trust
Disadvantages of EasyMarkets
The disadvantages of EasyMarkets are listed below.
- Limited Tradeable Symbols
- Higher Spreads on Some Accounts
- Outdated User Experience
Exante
Exante enables trading on over 270,000 options. Exante covers markets such as OSE, NYMEX, HKEX, and more. Exante sets commissions at $1.50 per contract with a high minimum deposit.
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About Exante
EXANTE is a global investment company founded in 2011, offering direct market access to over 50 financial markets and 1.3 million instruments across 8 asset classes. EXANTE provides a proprietary trading platform for desktop, mobile, and web. EXANTE is regulated by multiple authorities including FCA, CySEC, and SFC. EXANTE is known for its client-centric approach, competitive pricing, and extensive product range. EXANTE offers personalized service with dedicated account managers. The Exante CEO is Alexey Kirienko.
Exante Features
The features of Exante are listed below.
- Exante allows you to trade over 270,000 options in total.
- On Exante you can trade options on markets, namely, OSE, NYMEX, HKEX, EUREX, COMEX, CME, CBOE, CBOT, and ASX.
- Exante’s commissions on options start at $1.50 per contract traded.
- Exante requires a minimum deposit of $50,000.
Exante Pros and Cons
Advantages of Exante
The advantages of Exante are listed below.
- Wide Range of Instruments
- Transparent Pricing
- Dedicated Support
Disadvantages of Exante
The disadvantages of Exante are listed below.
- High Minimum Deposit
- Limited Automation
- Manual Report Requests
CMC Markets
CMC Markets offers over 1,000 vanilla options trading. CMC Markets includes the stock market, indices, commodities, and forex. CMC Markets imposes variable commissions (spreads).
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About CMC Markets
CMC Markets is a global online financial trading company founded in 1989 and headquartered in London. CMC Markets offers trading on forex, indices, commodities, cryptocurrencies, and shares through CFDs and spread betting. CMC Markets provides proprietary and MetaTrader platforms for desktop, web, and mobile. CMC Markets is regulated by multiple authorities including FCA, ASIC, and BaFin. CMC Markets is listed on the London Stock Exchange. The CMC Markets CEO is Lord Peter Cruddas.
CMC Markets Features
The features of CMC Markets are listed below.
- CMC Markets allows you to trade over 1,000 vanilla options.
- Options offered on CMC Markets cover the stock market, indices, commodities, and forex.
- CMC Markets charges variable commissions (spreads) on vanilla options.
CMC Markets Pros and Cons
Advantages of CMC Markets
The advantages of CMC Markets are listed below.
- Regulatory Trust
- Low Trading Costs
- Extensive Trading Platform
Disadvantages of CMC Markets
The disadvantages of CMC Markets are listed below.
- Complex Fee Structure
- Limited Funding Options
How much money does it take to trade options?
The recommended amount of money to trade options is around $1,000.
The options market is one of the most expensive markets to invest in, as it is like leveraged trading.
Each option contract has a minimum that generally ranges between 100 and 1,000 lots.
Let’s assume that investing in an option of a stock listed at US$5 that requires 100 lots of investment, then the trader should have at least $500 available in the account.
This is why it is important to have enough margin in one’s trading account to cover the initial investment, not just the bare minimum.
How much do you pay in commissions for options trading?
Brokers typically charge commissions of $1.50 per lot on options trading.
Commissions, however, can vary depending on the trading platform used, the type of account used, and the volumes generated by the account.
In addition, some brokers charge variable commissions that depend on the market value of the option and market volatility.
What types of options are available?
The options that are offered by brokers are of three types:
- Call-Put Options (Vanilla)
- Barrier Options (Knock-out)
- Binary Options
Call-put options, also called vanilla options, are among the most common in online trading. This type of options allows the trader to go long or short as if they were trading CFDs.
Barrier options work similarly to vanilla options, but they are distinguished by the fact that the position will be closed automatically if the option reaches the trader’s predetermined knock-out value. This is also why they are called knock-out options.
Binary options are the riskiest type of option on the market, and they are prohibited in dozens of countries. These options work like a bet. If the option reaches a certain goal (such as closing the day in the positive), then the trader will earn on average between 70 and 85 percent of what he invested in the trade, while on the contrary, will lose 100 percent, or everything if it does not hit.
Why is binary options trading often prohibited?
Binary options trading is banned in many countries because the mode of investment resembles gambling, and is extremely risky.
In fact, on binary options, it is not possible to manage risk, and as a result, the trader can only lose everything they bet, or earn 70-85% of what they bet.
However, if a trader has enough experience and manages to classify as a professional trader according to the requirements imposed by their country of residence, the broker might make binary options available.
On the other hand, traders who are classified as non-professionals (i.e., retail traders) will often not be able to access these types of options unless they are residents of countries that allow them (such as the United States).
Binary options are banned in several countries including:
- EU member countries
- United Kingdom
- Australia
- Japan
- Canada
Where are options listed?
Options are listed on dedicated derivatives indices or equity exchanges depending on the country.
Some of the most popular exchanges are EUREX (for European options) and CBOE/NYMEX (for U.S. options).
| Country | Options exchange | Complete Name |
|---|---|---|
| European Union | EUREX | European Derivatives Exchange |
| USA | CBOE | Chicago Board Options Exchange |
| Japan | OSE | Osaka Securities Exchange |
| USA | NYMEX | New York Mercantile Exchange |
| Hong Kong | HKEX | Hong Kong Exchanges and Clearing Limited |
| USA | COMEX | Commodities Exchange |
| Australia | ASX | Australian Stock Exchange |
| USA | CME | Chicago Mercantile Exchange |
| USA | CBOT | Chicago Board of Trade |
| Canada | MX | Montreal Exchange |
| Brazil | B3 | BM&FBOVESPA |
| India | NSE | National Stock Exchange of India |
| USA | ICE | Intercontinental Exchange |
| China | ZCE | Zhengzhou Commodity Exchange |
| China | DCE | Dalian Commodity Exchange |
| Korea | KRX | Korea Exchange |