Broker Replacement

J

JewelTrader

I am strongly considering replacing OptionsHouse. I've had an account there for a couple years, only had one problem before the TradeMonster merge and that was the day before the merge.
  • Their "risk department" decided to sell my same day expiration puts at 1:13pm. I have a cash account, no margin, there was no risk to them.
  • Trading platform has been down multiple times at critical times of the day (just before close, etc.)
  • They no longer show settled cash, so I have to track it manually.
  • My account balance has been whack (off by 2x) a few times.
  • My recent ACH deposit was double credited, which they fixed by leaving me with the fix date as the transfer date, leaving me with 6 days settlement rather than 3.
This has all been in the last couple weeks, I feel it is rather ridiculous. Customer service connect times are about an hour and then I get to chat with some useless ape and get nowhere. Unfortunately, internet reviews are rather dated and everyone is singing their praises. I suspect some of the recent reviews were paid for as well.

I am looking for a new broker. This is small account, low commissions are important, trading platform not so much as I have other accounts (larger accounts at higher priced brokerages, cannot justify commissions with the small account) with streaming data, level II, etc. In a quick look around today, I am both tempted and scared of eOptions and Just2Trade.

Thoughts?
 
JewelTrader said:
I am strongly considering replacing OptionsHouse. I've had an account there for a couple years, only had one problem before the TradeMonster merge and that was the day before the merge.
  • Their "risk department" decided to sell my same day expiration puts at 1:13pm. I have a cash account, no margin, there was no risk to them.
  • Trading platform has been down multiple times at critical times of the day (just before close, etc.)
  • They no longer show settled cash, so I have to track it manually.
  • My account balance has been whack (off by 2x) a few times.
  • My recent ACH deposit was double credited, which they fixed by leaving me with the fix date as the transfer date, leaving me with 6 days settlement rather than 3.
This has all been in the last couple weeks, I feel it is rather ridiculous. Customer service connect times are about an hour and then I get to chat with some useless ape and get nowhere. Unfortunately, internet reviews are rather dated and everyone is singing their praises. I suspect some of the recent reviews were paid for as well.

I am looking for a new broker. This is small account, low commissions are important, trading platform not so much as I have other accounts (larger accounts at higher priced brokerages, cannot justify commissions with the small account) with streaming data, level II, etc. In a quick look around today, I am both tempted and scared of eOptions and Just2Trade.

Thoughts?
More...

I have used eOptions for about a year. They are no frills, low cost. So far I have only used them for buying puts and calls, no spreads yet. Their support is just ok, but for $3.00 trades + $0.15/contract I can live with that.

Dana
 
Sorry about your problems at Optionshouse. But I have an impression that you may be a whiny, difficult customer who shops brokers like a checking account. If your grandfathered into low commissions and getting the Trademonster platform for free, you don't piss that away. But, all roads lead to IBKR in retail, imho.

@cafeole How is the execution quality at eOptions? Are you getting inside the mid-price? Who's model are you using for pricing?

If you try some butterflies, please tell us the quality of your fills. That's where the commission structure really shines. More consistent return strategies become viable at that pricing. What has kept me away is a stupid assignment fee.
 
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xandman said:
Sorry about your problems at Optionshouse. But I have an impression that you may be a whiny, difficult customer who shops brokers like a checking account. If your grandfathered into low commissions and getting the Trademonster platform for free, you don't piss that away. But, all roads lead to IBKR in retail, imho.

@cafeole How is the execution quality at eOptions? Are you getting inside the mid-price? Who's model are you using for pricing?

If you try some butterflies, please tell us the quality of your fills. That's where the commission structure really shines. More consistent return strategies become viable at that pricing. What has kept me away is a stupid assignment fee.
More...

I only trade options as a surrogate for stocks to get the leverage and to be able to short the market with puts. I only try to get in the bid/ask spread occasionally if I don't like the spread.
 
I am still at the simple call/put level (though I executed a killer strangle a couple weeks ago in my paper trading account, doh!), so butterflies aren't on my radar quite yet. I doubt I could even enter a single butterfly contract at the level of funding I've got available for this personal venture. It's really a trust issue here, I don't trust OptionsHouse any more. The other platforms I have (for retirement accounts) are at Fidelity and TradeStation, I'm still learning the latter, but I've been using Fidelity to chart and just flipping to OptionsMonster to trade anyway. I don't think theirs is a bad platform (when it works), but it isn't special.
 
For that case, choosing venues is as simple as using a ss table to tell you were you could minimize transaction costs per X amount of contracts assuming low potential for assignment. You have flexibility to play multiple accounts and brokers against each other.

Assignment fees just kills your savings over IBKR. On a short ATM/ITM butterfly strategy, I will find myself typically locked and hedged going into expiration. Giving up a nickel is as much as 20%-30% of remaining week's profit! Simply put, eOption commission structure is great for strategies that end OTM or allow favorable exits prior to expiration. As a home gamer/part-timer, I really don't need to be strategizing venues. I don't have the extra brain cells. Thus, all roads lead to IBKR. When I need more service/flexibility, I graduate to a Prime Broker. I will be eyeing eOption for a long time though.

Wide spreads usually means you are in the far end of the day's potential trading range, if no big news is pending. Definitely fight for the inside nickel/dime.
 
xandman said:
Wide spreads usually means you are in the far end of the day's potential trading range, if no big news is pending. Definitely fight for the inside nickel/dime.
More...

Agree there, this was a special case (DIS ER). I was pretty sure they would beat (10 million Elsas and record attendance daily at the parks), and they beat huge, but I was practicing hedging. I will be reading up on those butterflies though, I opened the new TradeStation account for such things. No options for me on Fidelity (401k employer restriction).
 
I cut my options trading teeth at Optionshouse. There was beauty in the simplicity of their platform which made you think about the important stuff. Trademonster platform seems to be highly regarded in the retail set, but not as much as TOS. All of these platforms are a fail when criticized by our more professional SME's on ET.

This is not a plug for Barron, but our sponsors are truly best in class because the other firms just can't stand up to the scrutiny. When your ready to graduate to more advanced platforms' functionalities, our SMEs ( and now a sponsor rmorse will gladly show "a" way). I really can't beat IBKR at my level except that the platform is painfully clunky but then I have Livevol as my front end. Also, a retail trader should consolidate assets and making use of PM margin is priority. It's not like GrandPa's CD investments and trying to get FDIC insurance. It opens up your strategy windows.

If you would be so kind and look up this thread http://www.elitetrader.com/et/index.php?threads/spread-simulation.289810/ . I am looking for input on Fidelity options tools. Do you know that they provide tools from some of the best 2nd party tool vendors in the brokerage industry? Unless your technical chops involve calculating+graphing the skew, ANOVA models and calculating continuous step hedging in Excel, I would take a deep look into what Fidelity provides.
 
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Thanks for the heads up on what Fidelity offers. It's hard to know what you have (or don't) until you're in for a while. I responded on your other thread.
 
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