Thinkorswim vs OptionsHouse: Introduction
Investors at TD Ameritrade get the broker's very advanced desktop platform thinkorswim, but with rather steep commissions. OptionsHouse has a less sophisticated platform, but with lower fees. Let's take a detailed look at these two firms and their trading technology, and see if one of them can be considered the better value.
Upon logging into the OptionsHouse website, the broker's platform automatically generates its own window. It does this because the website has no trading capability. It is used primarily for the management of account documents and basic information, such as address and investment objective. The OH platform runs on Adobe Flash Player. It does not have a desktop icon like thinkorswim, because it operates from the broker's website. Nevertheless, it fills the screen much like thinkorswim does.
On the left-hand side of the platform appears basic account information. Cash buying power, today's market gain, and other important measurements are displayed. A watch list, market news, and order status are shown underneath. On the right-hand side appears the account's positions, messages from the broker, and another watch list.
The middle section of the platform is where security trading and analysis take place. Under the trading tab, users can select charting, a security's option chain, and strategy testing. There is also basic information on a stock from optionMonster, but it's rather limited.
Under the markets tab, there is an economic calendar, a watch list, and financial news from Benzinga, Zacks, and optionMonster. The account tab displays positions, account history, and a pie chart that show's the account's composition.
A chart can be detached and displayed full-screen. There are several technical studies available, including Keltner Channels and Wilder's DMI. There is also a description of each technical study so that traders know what to look for. Colors and periods used in a particular study can be modified.
TD Ameritrade's advanced platform, thinkorswim, is much more advanced than the OptionsHouse trading system. The software has more than 400 technical studies, far more than what OptionsHouse supplies. Thinkorswim also has more drawing tools.
The economic calendar in thinkorswim has many more events than OptionsHouse's platform has. For example, thinkorswim shows conference calls, futures liquidation, dividends, splits, and ETF dividends. The OH platform only shows earnings announcements.
Like the OptionsHouse system, thinkorswim is mostly arranged by tabs with sub-headings. One tab is Scan. There are several search engines under this tab that will scan for various securities based on the criteria the user inputs.
Unlike the OptionsHouse platform, thinkorswim has a library of financial videos. These are recent news stories from CNBC and Reuters. Thinkorswim also has live customer service, which the OH system does not have. TD Ameritrade's platform can also be used to trade futures and forex. News on currencies and commodities can be displayed on the left-hand side of the screen.
Thinkorswim's sophistication also means it's more difficult to navigate than OptionsHouse's platform. It is more customizable also, which adds to the software's complexity. The TD Ameritrade software has more of a professional feel to it, while the OptionsHouse system is simpler and more user friendly. The primary similarity is that both platforms are free to use.
Besides being a desktop platform, TD Ameritrade adapted thinkorswim for use on mobile devices. The thinkorswim app can be used on iPhone, iPad, and Android devices. The software functions with fingerprint-enabled tablets and phones. The app has several of the sophisticated functions found on the desktop system. There is advanced charting, not found on any other mobile platform in the industry. There are close to 400 studies. Use of the app is free and does not have any frequent trader requirement. CNBC streams free of charge as well. Besides the thinkorswim app, TD Ameritrade also has a platform for Apple Watch.
OptionsHouse customers can buy and sell stocks, options, mutual funds, and ETF's on the broker's mobile platform. It works on Apple and Android tablets and phones. Traders can also use the broker's site on mobile web. OptionsHouse doesn't charge any fee to use these mobile platforms. Charting includes 12 technical studies. Unfortunately, the broker doesn't offer live streaming of financial news or any app for a smart watch.
Both thinkorswim and OptionsHouse's desktop systems and mobile apps have paper trading.
The Cost of Trading
Both firms have to find a way to pay for all this technology. They of course do that by charging for trades. TD Ameritrade's commission for stock and ETF transactions is $9.99. Options are an additional 75¢ per contract. Exercises and assignments are a pricey $19.99.
OptionsHouse charges just $4.95 for stock and ETF trades. This is one of the lowest commissions in the industry. Options are only 50¢ per contract, another very low charge. Assignments and exercises are charged the regular $4.95 commission.
OptionsHouse vs Thinkorswim: Summary
Thinkorswim (Thinkorswim review) is ideal for experienced or professional traders who want a lot of sophistication, customization, and advanced features. OptionsHouse's (OptionsHouse review) technology is better for traders who prefer something simpler and more user friendly. Frequent traders may actually prefer the OptionsHouse platform due to the significant difference in commission schedules.
We see no reason not to open accounts at both firms - it costs nothing to maintain and traders can take advantage of all the great features
these two top brokers offer.