Optionshouse vs Interactive Brokers – If you are looking for an online broker to trade stocks, options, ETFs, or mutual funds, you may be wondering which one is better: Optionshouse or Interactive Brokers. Both brokers offer low commissions, advanced trading platforms, and access to a variety of markets and instruments. However, they also have some differences that may make one more suitable for your needs than the other.
In this article, we will compare Optionshouse and Interactive Brokers on several key factors, such as trading costs, account minimums, international trading, research tools, customer service, and more.
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Trading Costs and Commissions
One of the most important factors to consider when choosing an online broker is how much it will cost you to trade. Trading costs include commissions, fees, spreads, and margin rates. Here is how Optionshouse and Interactive Brokers compare trading costs and commissions:
- Stocks/Options: Optionshouse charges $4.95 per trade plus $0.50 per options contract. Interactive Brokers charges $0.005 per share ($1 minimum) for stocks and $0.25 to $0.70 per contract ($1 minimum) for options.
- ETFs: Optionshouse charges $4.95 per trade for ETFs. Interactive Brokers charges $0.005 per share ($1 minimum) for ETFs.
- Mutual Funds: Optionshouse charges $20 per purchase for mutual funds. Interactive Brokers charges $14.95 per purchase for mutual funds.
- Spreads: Both brokers offer competitive spreads on various instruments, such as forex, futures, and CFDs. However, spreads may vary depending on market conditions, liquidity, and volatility.
- Margin Rates: Both brokers offer margin trading with varying interest rates depending on the amount borrowed and the account balance. Optionshouse offers margin rates ranging from 3% to 8% depending on the account balance. Interactive Brokers offers margin rates ranging from 0.75% to 2% above the Fed Funds rate depending on the amount borrowed.
Both brokers offer low commissions for most types of trades, but Interactive Brokers may be cheaper for high-volume or large-size trades due to their per-share pricing structure. However, trading costs may also depend on other factors, such as commission-free ETFs and mutual funds, discounts for active traders, and special offers or bonuses for opening an account.
Account Minimums
Another factor to consider when choosing an online broker is how much money you need to open an account and maintain it. Account minimums may vary depending on the type of account, the level of service, and the market access. Here is how Optionshouse and Interactive Brokers compare on account minimums:
Optionshouse
Optionshouse is a no-minimum brokerage, so you can open an account with whatever amount you deem appropriate. However, you may need to meet certain requirements to trade certain instruments or access certain features. For example, you need at least $2,000 to trade options or margin accounts, at least $25,000 to day trade stocks or ETFs, and at least $100 to trade futures or forex.
Interactive Brokers
Interactive Brokers require a $10,000 deposit to open an account ($5,000 for IRAs or $3,000 for investors under 25 years old). However, this amount can be reduced by earning commissions within the first eight months of opening an account. For example, if you generate $100 in commissions in the first month of opening an account, your minimum deposit requirement will be reduced by $100 to $9,900. You also need to maintain a minimum equity balance of $2,000 ($25,000 for pattern day traders) to avoid monthly activity fees.
Optionshouse has lower account minimums than Interactive Brokers, but Interactive Brokers allows you to reduce your minimum deposit requirement by earning commissions within a certain period of time.
International Trading
Another factor to consider when choosing an online broker is how much access you have to international markets and instruments. International trading may allow you to diversify your portfolio, take advantage of global opportunities, and hedge against currency risk. Here is how Optionshouse and Interactive Brokers compare on international trading:
Optionshouse
Optionshouse does not offer direct access to international markets or instruments. However, you can trade American Depositary Receipts (ADRs), which are U.S.-listed securities that represent shares of foreign companies. You can also trade U.S.-listed ETFs that track foreign indices, sectors, or currencies. However, you may incur additional fees, taxes, or risks when trading ADRs or ETFs.
Interactive Brokers
Interactive Brokers offers direct access to over 135 markets in 33 countries and 23 currencies. You can trade stocks, options, futures, forex, bonds, ETFs, and CFDs from a single account. You can also convert currencies at market rates, hedge your positions with currency futures or options, and use various tools and reports to analyze your global exposure and performance.
Interactive Brokers offers much more access to international markets and instruments than Optionshouse. However, international trading may also involve higher costs, complexity, and risk than domestic trading.
Research Tools
Another factor to consider when choosing an online broker is how many research and analysis tools you have access to. Research tools may help you find trading ideas, evaluate potential trades, and monitor market trends and news. Here is how Optionshouse and Interactive Brokers compare on research tools:
Optionshouse
Optionshouse offers a variety of research tools for different types of traders and investors. You can use the Trade Generator to find potential trades based on your criteria and risk tolerance. You can use the Trade Calculator to estimate the profit or loss of a trade before placing it. You can use StrategySEEK to scan the market for options and strategies that match your outlook and goals. You can also use the Market Pulse to view market data, news, events, and alerts.
Interactive Brokers
Interactive Brokers offers a comprehensive suite of research tools for various markets and instruments. You can use the IB SmartRouting to find the best execution price for your orders across multiple venues. You can use the IB Risk Navigator to measure and manage your portfolio risk across multiple dimensions. You can use the IB Market Scanner to scan the market for trading opportunities based on your criteria. You can also use the IB News Feed to access real-time news from various sources.
Both brokers offer a range of research tools for different purposes and preferences. However, Interactive Brokers may offer more advanced and sophisticated tools than Optionshouse.
Customer Service
Another factor to consider when choosing an online broker is how much customer service and support you can expect. Customer service may include phone, email, chat, or social media support, as well as FAQs, tutorials, webinars, or forums. Here is how Optionshouse and Interactive Brokers compare on customer service:
Optionshouse
Optionshouse offers phone support from Monday to Friday from 8 a.m. to 8 p.m. ET. You can also contact them via email or chat during the same hours. You can also visit their website for FAQs, guides, videos, webinars, or blogs.
Interactive Brokers
Interactive Brokers offers phone support 24/7 in multiple languages. You can also contact them via email or chat during market hours. You can also visit their website for FAQs, guides, videos, webinars, forums, or glossaries.
As you can see, both brokers offer various channels of customer service and support. However,
Interactive Brokers may offer more availability and diversity than Optionshouse.
In conclusion, Optionshouse and Interactive Brokers are both reputable and popular online brokers that offer low commissions, advanced trading platforms, and access to a variety of markets and instruments. However, they also have some differences that may make one more suitable for your needs than the other.
Optionshouse may be better for you if:
- You are looking for a simple and easy-to-use broker with no account minimums.
- You are mainly interested in trading U.S.-listed stocks, options, ETFs, or mutual funds.
- You are looking for a variety of research tools that cater to different types of traders and investors.
Interactive Brokers may be better for you if:
- You are looking for a sophisticated and powerful broker with low trading costs.
- You are interested in trading international markets and instruments across multiple asset classes and currencies.
- You are looking for advanced and comprehensive research tools that cover various markets and instruments.
We hope this article has helped you compare Optionshouse and Interactive Brokers on several key factors so that you can make an informed decision.
Frequently Asked Questions (F&Qs) Optionshouse vs Interactive Brokers
Is IBKR good for options?
Yes, Interactive Brokers (IBKR) is a good platform for options trading. It offers a wide range of features and tools that are designed to help traders of all levels of experience.
What is the minimum deposit for Interactive Brokers?
The minimum deposit for Interactive Brokers is $0. This means that you can open an account with Interactive Brokers and start trading with any amount of money. However, there are some account types that have minimum deposit requirements. For example, the Margin Account requires a minimum deposit of $2,000.
Is IBKR good for beginners?
Interactive Brokers (IBKR) is a good brokerage for beginners, but it is not the best choice for everyone.
Are Interactive Brokers Good for day trading?
Interactive Brokers (IBKR) is a good platform for day trading. It offers a wide range of features and tools that are designed to help traders of all levels of experience.
Optionshouse vs Interactive Brokers