eOption Review: Commissions, Fees, and Minimum Deposit
|Stocks and ETFs|| $3|
|Options|| $3 + $0.15 per contract|
|Option Exercise and Assignment|| $9|
|Foreign Stocks|| $39|
|Extended Hours Trading|| $25 for up to 5,000 shares, $0.003 per share for over 5,000 shares|
|Mutual funds|| $15|
|Listed Bonds|| first 25 bonds - $5 per bond, each additional bond - $3 per bond, minimum - $39|
|Auto Trade Equities|| $5|
|Auto Trade Options|| $5 + $0.10 Per Contract|
|Investments|| stocks, options, mutual funds, bonds, foreign stocks, ETFs|
|eOption minimum deposit to open account|| $0 for US; $5,000 for international accounts|
A new account application for individual, joint, or IRA accounts takes 15-20 minutes to complete. The forms have more questions and screens than with
most other brokers. We didn't see questions such as "What's your tax rate?" or "Banking references" at the other firms.
You will be offered six money sweep options for your cash, some of which are the California Daily Tax-Free Income Fund and the Daily Income Fund U.S. Government
Portfolio, Retail Class. The names look good, but seeing also a summary of their rates and fees would be much more helpful.
At the end, the complete form is displayed in a tiny window for a final review, and as a result it's very hard to read. eOption utilizes an electronic signature, so there
is no need to mail the application. Shortly after the application is complete, you'll get two emails: one contains the account number, which will be your user name -
it is impossible to remember. The other contains a very convoluted initial password. After a bunch of frustrating attempts to login, we had to contact customer
service for help. Their reply was that there is replication gap (the time between when your account is created and when you first are able to log in): it would
be nice to let new customers know that up front. In about two hours we were able to log into the website.
While other brokerage firms combine new account setup with funding setup, eOption decided to hide funding information from its customers. After going
through the whole menu looking for an ACH setup screen, we finally found some information on the FAQ page. As it turns out, in order to utilize ACH, you must
complete and mail an Authorization for Electronic Transfer form along with a voided check or bank letter. From the receipt of your Authorization form,
ACH activation may take up to 10 business days. So much for the benefit of not having to mail in any account setup forms.
The home page of eOption.com looks fine. But after you log into the eOption.com website, it looks the least professional of all brokerage firms we
reviewed. The design is crude and seems almost half-finished: there are missing spaces between words (even between your last and first name!) and
between words and numbers, there are odd dates, and huge blocks of empty space on the pages (see image above). The login screen doesn't provide that must-have
"Forgot your user name/password?" link, and it too looks like a work in progress. All this doesn't inspire much confidence in the company.
eOption Review: Pros
- Very low commissions
- Great margin rates
- Dividend reinvestment plan
eOption Review: Cons
- Very expensive extended hours trading commissions
- Limited trading tools and charts
- Limited research
- Streaming quotes are only free to those making 100+ trades per month
- No online ACH. Anytime you want to perform an ACH you have to call their 1-800 number.
- $15 annual IRA fee
- $50 annual inactivity fee, if less than two trades in the past 12 months or less than $10,000 in credit or debit balances
eOption Review: Summary
eOption is a discount online brokerage firm with some of the lowest commissions in the industry. Stock and ETF trades are just $3 per trade.
Unfortunately, extended hours trades are extremely expensive, and start at a hefty $25, which is a deal-breaker for many traders.
As the name suggests, eOption's primary focus is on options traders. Options commissions are some of the best ($3 ticket charge plus
$0.15 per contract) and simple options trading is implemented well. But there are some issues that need to be worked out with complex options
trading. The option exercise and assignment fee is not cheap at $9.00.
New account setup takes a while and often
involves calling customer service. If you want to deposit money through ACH, you will have to mail the
Authorization form and wait for around 10 business days for the activation of ACH. Prospective clients will need a lot of patience before they can start trading
The firm offers live streaming quotes for free only to customers making 100+ trades per month. They charge $35 per month for live streaming quotes for
customers making 0-50 trades per month, and $15 per month for customers making 51-99 trades per month.
Their web-based trading, which is very basic, is also free.
Third-party trading platforms come with an additional fee. There is a $50 annual inactivity fee for accounts with less than two trades in the past 12 months or
less than $10,000 in credit or debit balances.
eOption has been given the third lowest ranking in Barron's magazine annual broker surveys in 2013-2015. It got horrible results in all categories
except Costs and Ranges of Offerings.
Low commissions come at a cost: eOption's functionality is crude and basic, and desperately needs to be upgraded. Their customer service is spotty
We recommend eOption only for very self-reliant and adventurous options traders. For everybody else, especially
Active Traders there are better and safer online brokerage
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Reviewed by Brokerage-Review.com on
Reviewed by Editor and eOption customers.