Option Trading Brokers
- What Is Option Trading?
- Best Option Trading Brokers
- How to Do Options Trading?
- What Is the Future and Options Trading Difference?
- Options Brokers List
What Is Option Trading?
Options Trading is the practice of buying and selling options contracts while options contracts give traders and investors the right to buy and sell underlying assets at a certain period of time with a specific price. Options contracts are for a set period, be it a day or even a year or a few. Buying an option, the trader has a choice to trade the underlying asset, or not, however, commitment points will come into place.
- In fact, any asset can be traded as options meaning clients can trade stocks, bonds, ETFs, currencies, etc. as options
- By correctly predicting stock movement before an option expiration date, investors may stand to benefit significantly – but if their contract lapses without value they will lose their initial investment
- Note that most Forex Brokers offer mainly Options CFD Trading where traders can only speculate on the price movements, unlike Real Options Trading. Read more about Options Trading on the Wikipedia Page.
|🏦 Spread/ Fee
|Depending on Broker, Typically Commission Based
|Sell and Buy
|Micro Lot, Standard Lot (Depending on the broker)
What is Options Trading Platform in Forex?
Options Trading doesn’t require a separate platform, in fact, if the broker has Options listed in its instrument range platforms offered by the broker are automatically configured to option Trading. Here are some notes on Options Trading you might be interested in:
- Options are quite complex instruments requiring a certain set of knowledge and are not suitable for everyone.
- There are two distinct option types recognized: a call option and a put option. Generally, call options give the right of buying a stock, whereas the put option enables one to sell the option. The price at which you buy or sell the stock is known as the strike or exercise price.
- To start trading options, the first and essential step is to find a trustworthy broker that supports options. Commonly to start with options, traders need to make at least a $1,000 investment, which is considered an entry-level.
- When picking an Option broker, we recommend paying attention to a number of aspects, mainly education and good research. Check whether the broker offers special educational videos, articles, webinars and good tools, etc to understand and trade options properly.
|Options Trading Advantages
|Options Trading Disadvantages
|High Commissions might be charged
|Options are complex
|Loss potential is higher for sellers
|More Alternative Strategies are available
|Not Suitable for Beginners
|Low initial capital
|Lower liquidity for on some stock options
|Options are leveraged
Top 5 Best Option Trading Brokers
Below we made a list of the Best Reviewed Option Brokers made of strictly Regulated Brokers with good conditions, in fact not so much from Forex Brokers support options trading due to its complexity na dmajority of Forex brokers offering CFDs on Options, here we pick a few best:
- Interactive Brokers – Best Overall Real Trading of Options Broker 2024
- Plus500 – Best CFDs Options Broker 2024
- IG – Best Options Broker for Beginners 2024
- Trade.com – Best Low Spread Options Broker 2024
- Libertex – Best MT4 Options Broker 2024
How to Do Options Trading?
The first step is finding a reliable broker enabling options trading. It is important to consider the tools and features the broker provides and see whether they match your trading needs and expectations. It is advisable to make use of the broker’s educational materials and then start option trading itself which is determined by the strategy you choose.
What is the Future and Options Trading Difference?
Both futures and options are derivatives and their value derives from the value of an underlying asset. While futures are derivative financial contracts that obligate buyers to buy an asset or the seller to sell it at a predetermined future date and price, options give the right to buy or sell, yet they do not obligate to do so.
Which broker is best for option trading?
In fact, there are not so many brokers offering options trading in forex, and all are based on CFDs. Here are some of the most popular OTC brokers for Options InteractiveBrokers, Trade.com
How much money do I need to start trading options?
The minimum capital for options trading can be as low as $1,000 for CFDs; however, for bigger profits, it is advisable to put at least $5,000-10,000.
List of Forex Brokers for Option Trading
These are the brokers that are regulated and recommended for Options Trading, yet we advise you to check conditions based on your jurisdiction:
Min. Deposit: $10
Max. Leverage: 1:30 | 1:3000
Trading Platforms: MT4, MT5
Regulation: FSCA, CySEC, FSA, FSC
|SquaredDirect | SquaredFinancial
Min. Deposit: $250
Max. Leverage: 1:30 | 1:500
Trading Platforms: MT4, MT5, Mobile App
Regulation: CySEC, FSA
Min. Deposit: $5,000
Max. Leverage: 1:30
Trading Platforms: SaxoTraderGo, SaxoTraderPRO
Regulation: DFSA, FCA, ASIC, CBUAE, JFSA, MAS, SFC
Min. Deposit: $0
Max. Leverage: Margin Trading
Trading Platforms: Firstrade Proprietary Trading Platform, Options Wizard, Mobile Apps
Regulation: SEC, FINRA, SIPC
Min. Deposit: $100
Max. Leverage: 1:30 | 1:400
Trading Platforms: MT4, MT5, WebTrader, AvatradeGO, AvaOptions, DupliTrade, ZuluTrade, AvaSocial, Capitalise.ai
Regulation: Bank of Ireland, ASIC, JFSA, FSCA, CySEC, BVI FSC, FRSA, ISA