Options Trading Grade: B
Overview:
OptionsHouse offers a high quality options trading experience. Establishing new positions from the options chains window or closing out existing holdings from the positions window is handled well. Trade confirmations display execution time down to the second. The flexible trade ticket allows the entry of any order type desired and a nice selection of conditional orders is a nice bonus. Open orders can be modified or canceled but, like the quirk found with stock orders, option orders cannot be modified when the market is closed. We were surprised to find that no detailed options contract pages or options price charts exist. Minor issues aside, OptionsHouse has a very competitive options trading platform.
Order Types:
OptionsHouse does not have predefined option order types. Users manually enter their desired combination of stock and option legs using a flexible trading menu. This allows for the entry of up to four option legs or one stock leg paired with three option legs. This would correspond to order types such as spreads, straddles, butterflies, iron condors, etc. In addition to the standard option order types, traders can also use conditional trades via the advanced trade ticket. This includes Order Cancels Order (OCO), Order Triggers Order (OTO), Order Triggers OCO and Order Triggers Two Orders.
Details:
The new OptionsHouse platform was launched in March 2011. There are now 26 pre-built grid style layouts to choose from. Each layout window can be populated with one of 20 interfaces, such as account activity, positions, quotes, news and a stock screener. It might not be quite the most visually appealing or flexible broker trading platform but it is a nice improvement over the old interface. Here is a look at a layout that we customized to show the windows quotes, research, news, sector monitor, watchlist and hot list (click on images for larger views):
At the top menu of the interface is a tab labeled Options. Clicking on this loads the Options Chains window. Here is a look at a selection of contracts and their bid and ask prices for Citigroup (C):
When we found the contract that we were interested in we clicked on the ask price. This loaded the order ticket with our desired contract, a quantity of one and an order type of limit with the limit price set to the current ask price. As an alternative to the Options Chains window, the Order Ticket window can be accessed directly at any time by selecting the Order Ticket button found at the bottom left corner of the interface. We changed the duration from a day order to GTC (good until canceled). GTC orders have an unspecified duration. Once everything was set we clicked on the Preview button:
A warning message appeared which notified us that the market was closed at the time and that the order would be submitted once the market re-opened. Note that a separate warning message will be present if a limit price is entered that is more than $1 above or below the last trade price. Both warning messages can simply be ignored. The estimated cost of the trade, including trading commissions, is provided as well. Everything looked OK so we clicked on the Place Order button:
Our order was submitted and the order ticket provided us with an order number for reference purposes. We closed the trade ticket and navigated to the Orders window, which shows both open orders and recently executed orders. From this menu, orders can be modified or canceled. One annoying quirk is that orders cannot be modified when the market is closed. This means that if you submitted a trade outside of market hours and you want to change, say, the limit price, you must cancel the order and submit a new one. We have no idea why this restriction exists. Thankfully, there is no such issue with canceling open orders.
We decided to let our trade go through so it executed upon the next market open. At this point, our position was populated in the Positions window. We decided to sell our contract so we clicked on the position and selected Sell:
This brought up the order ticket with the contract, action and quantity automatically populated. The order type was set to limit with a price equal to the ask price. This is done perfectly and makes closing out positions very convenient.
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