With the recent events of AMC and GameStop, many current event junkies are left asking, what are options? How can I trade options and what is the best platform to do so? For investors today, there are countless places where options can be traded. The challenge, however, is finding the platform that aligns with your preferences and level of experience.
If you are serious about options, Firstrade is a platform that should merit some consideration. Though not a household name like Robinhood, Firstrade has unique features and a unique history starting in the 1980s. Firstrade offers nearly every tradeable security desired. For this review, we will stick to options, but encourage you to learn how Firstrade stacks up against the juggernaut, Robinhood.
Firstrade is an online brokerage firm that was started in 1985.
This company prides itself on being the one-stop-shop for all your investment needs. Although not as well-known as other brokerage firms, Firstrade has withstood the test of time. A clear sign that it has something good to offer.
Whether you want to try investing in individual assets, ETFs, options, or bonds, Firstrade is a company you should consider.
In this article, we will outline the experience of trading options on the Firstrade platform.
Currently, Firstrade is offering one of the best free stock promotions in the industry. New users who sign up for the platform and fund their accounts with at least $100 will receive 3 free stocks!
You'll receive your first free stock just for opening the account. Then after funding with at least $100, you'll get 2 more free stocks. The free stocks are chosen on a lottery basis and range anywhere from $3 to $200 each. That means that if you play your cards right, you could end up with $600 in free stock!
The Firstrade brokerage offers an attractive platform for trading options. Once accepted you can begin trading options for free. Firstrade also provides some useful educational resources for those who might not be familiar with trading options.
Before using options on Firstrade, investors must apply through Firstrade’s customer service portal by submitting an Option Application & Agreement. Once the form is completed, it can either be uploaded to the customer service portal or emailed to [email protected]
The most important thing you need to know is that Firstrade, unlike nearly every other brokerage, charges $0 for contracts.
That’s right, with Firstrade, users can essentially use options for free. With Firstrade, you pay $0 commission & $0 contract fees, no exchange, exercise, or assignment fees. How’s that for a brokerage account?
Of course, don’t forget other fees that may be charged by financial regulators or clearinghouses that are not run by Firstrade. These fees are often minimal but standard across the industry.
Firstrade puts incredible tools and resources into the hands of its investors. For starters, there is a large number of educational videos available on the website and application. This allows users to see firsthand, through a screen recording, exactly how to purchase options contracts on the app.
Firstrade also curates a selection of news articles, video commentary, and stock reports all furnished from Morningstar all for free.
By providing such a high standard of research and education, Firstrade wants its users to feel secure that this is the only platform they’ll need.
Firstrade also features the Options Wizard. This tool provides instant feedback on the value and likelihood of success of any options trades on your watchlist.
This feature includes 65+ technical indicators, 1-month & 6-month trend indicators, 40+ complex options strategies, profit & loss simulations, and much more.
For iOS users, Firstrade offers a redesigned Options Chain which lets you view calls and puts them together on the same screen, place and edit options, and close complex options positions in one click.
OptionsPlay gives investors ideas about where to look for great trades as well as provides strategies that anyone can use to bolster their earnings. This feature also allows users to see optimal income opportunities for any stock or ETF
Before we start, it is crucial to understand the increased risk that is involved when trading options. When a user purchases an options contract, they do not technically have to own the underlying asset. That means swings in the stock price are amplified. This, in turn, amplifies the earnings or losses of the investor.
In essence, an option is a right (not the obligation) to buy (call) or sell (put) a certain stock at a certain price. The quantity of the stock is predetermined as well as the price. However, users are not obligated to hold the contract until the price hits the predetermined price. They are allowed to close their position before that time.
Options are inherently risky because the value of the option is derived from the price of an underlying stock. You are essentially going ‘all-in’ that the stock will either increase or decrease in value.
A platform that has zero options contracts fees. What’s not to love about that? In addition, all the educational and technical resources available make Firstrade a truly remarkable service. Users who want the all-in-one-package might really enjoy Firstrade and consider it the best place for a full-service experience.
However, recognize that Firstrade has limited customer service availability. If you want to speak to a real person, you will have to call between the hours of 8:00am - 6:00pm ET Monday through Friday. However, if you can’t reach them by phone, there is email optionality and a virtual assistant that can help with run-of-the-mill questions.
All in all, Firstrade has a really impressive spread for options users. If you want to jump in with both feet into the world of options, give it a try today!