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$0 per contract and $0 base
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Webull ranks among the least expensive brokerage firms for options trading. Its fee schedule is difficult to match:
there is no base commission, no per-contract charge for stock and ETF options, and no fee for exercise or assignment.
Some exceptions apply, including a $0.50 fee per contract for certain index options and a $0.10 fee
per contract for option orders exceeding 500 contracts, excluding index options. Regulatory and exchange charges may also apply. This inexpensive structure is especially useful for traders who want to avoid having
commissions consume part of their profits.
Webull also provides relatively low borrowing costs for margin customers. The standard margin rate is 8.74% at every debit-balance tier, while Webull Premium members may receive lower rates that vary by balance. Remember that leverage can
increase losses as well as potential gains.
Customers can request options-trading privileges through the mobile app, desktop platform, or website.
In the mobile application, tap Account in the bottom center and then Account Management in the upper-right corner. Choose the appropriate account, select
Option Trading Level, and tap Apply for Options Trading. Complete the prompts to send the request. Approval is not automatic and normally requires one to two business days, although Webull may make some decisions immediately.
Read full Webull options trading review »
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$0 for stock and ETF options; index option fees apply
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Anyone who trades stocks or options at Robinhood is probably familiar with the broker’s commission-free pricing for supported stocks, ETFs, and stock and ETF options. Robinhood assesses no base commission or per-contract charge for stock and ETF options. Contract fees on index options, regulatory charges, and other costs may still apply. This pricing is particularly valuable to traders who frequently use strategies with several legs.
Constructing multi-leg options positions at Robinhood adds considerable flexibility. Depending on the strategy, traders can lower the initial cost, seek returns from an upward or downward price move, or establish a position that may benefit as time value decreases.
Credit spreads, debit spreads, butterflies, condors, and calendar spreads can all help traders tailor a position and place boundaries around certain risks.
Fees and Commissions
Before reviewing Robinhood’s available strategies, it is useful to emphasize that stock and ETF option spreads carry no base commission or per-contract charge. Nevertheless, index option contract fees and regulatory fees may apply.
Types of Multi-Leg Options at Robinhood
Robinhood supports numerous strategies involving more than one options leg. The specific positions available to a customer depend on the account’s approved options-trading level.
Multi-leg spread trading requires Level 3 approval and is available in eligible margin accounts, but not in cash accounts or Robinhood Retirement accounts.
Robinhood customers can use the following multi-leg strategies:
- Credit Spreads
- Debit Spreads
- Calendar Spreads
- Diagonals
- Iron Condors
- Iron Butterflies
- Butterflies
- Unbalanced Butterflies
- Broken-Wing Butterflies
- Straddles and Strangles
Here is a closer look at building and controlling a multi-leg order.
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Placing a Multi-Leg Options Trade
A multi-leg order can contain up to four legs. Eligible calls and puts may be combined with buy and sell instructions, provided the order meets Robinhood’s requirements for supported strategies, collateral, and expiration dates.
The on-screen colors change as prices move, using red and green to indicate whether the selected calls or puts are declining or increasing in value.
By combining buy, sell, call, and put instructions, customers can assemble the desired supported strategy.
The following example demonstrates how to construct a put butterfly on a familiar technology company.
Begin by selecting the contracts and their expiration dates. Moving between buy and sell creates the position’s long and short legs.
At this stage, the quantity for each contract cannot yet be entered. That adjustment is made afterward.
Once the contracts have been selected, open Custom to modify the number assigned to each leg. This feature allows a different ratio to be used for each component of the trade.
For this illustration, one additional short put is included to complete the butterfly. The profit-and-loss graph then changes to display the position’s theoretical risk and reward at expiration.
After reviewing the completed position, select Continue to open the order-review page.
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Managing Multi-Leg Positions
Robinhood makes multi-leg positions reasonably easy to manage, although traders must remain aware of several substantial risks.
Position management can involve increasing the trade, closing it, rolling contracts to another expiration or strike, or modifying separate legs.
A critical consideration is the effect of each change on collateral and buying power. Removing or adding even one leg can materially alter the position’s exposure.
Robinhood prohibits uncovered short options. After a protective contract is removed, any remaining position must continue to meet the broker’s collateral and options-approval requirements.
Legging In and Out
Traders sometimes enter or exit one leg at a time to lock in a gain or transform an existing position into a different spread without closing every contract together.
For instance, after a purchased call becomes profitable, a trader may be able to sell another call against it and turn the position into a debit spread rather than immediately selling the original call.
If the underlying stock subsequently falls, the spread could lose less than the standalone long call. The result, however, depends on the strike prices, expirations, premiums, volatility, and magnitude of the stock’s movement.
Adding the short call also places a ceiling on part of the trade’s possible upside.
Closing the Position
Robinhood permits customers to close an entire multi-leg strategy in one order or exit eligible contracts separately. To preserve the position’s risk controls, the broker may require traders to close a short leg before removing its protective long leg unless the remaining position is fully supported by the necessary collateral. Exiting legs individually can expose the account to losses beyond the original strategy’s theoretical limits.
Robinhood Multi-Leg Options Pros and Cons
Robinhood has expanded its options platform considerably. The broker now accommodates a broad selection of advanced strategies, giving traders more control over how they respond to varying market conditions.
Even with these improvements, some parts of the experience could be refined. These are the principal advantages and disadvantages we found.
Pros
- Option chains have a clear layout
- Contracts are easy to select
- Useful profit-and-loss graph
- Many multi-leg strategies available
Cons
- Complex orders may not fill quickly
- Uncovered options are unavailable
- Adding individual legs requires more time
- Contract quantities require another step
Robinhood Multi-Leg Options Summary
Robinhood is a strong choice overall for customers interested in multi-leg options. Its spread-building features allow traders to create positions on high-priced stocks, limit certain forms of risk, and express several different market views. Although the platform could still be improved, it provides many of the essential tools options traders need to construct strategies that fit their objectives.
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How to Trade Options Before an Earnings or News Release
Selecting an appropriate options position before a company announces earnings can be challenging. Investors expecting the report to push the stock higher or lower sometimes purchase calls or puts. Others open a straddle or strangle by buying both a call and a put, aiming for a move in either direction that is large enough to overcome the combined option premiums.
Limited Risk and High Potential Reward
A major benefit of purchasing a call or put is that the buyer generally knows the maximum possible loss when opening the position. If an Apple call has a total price of $100, the buyer will ordinarily risk no more than the $100 premium plus applicable fees. The trade can become profitable when Apple moves sufficiently far in the anticipated direction before expiration.
A difficulty with buying options before an earnings release is that implied volatility commonly increases ahead of the announcement. The market’s expectation of a large price change can make contracts more expensive. Once the results become public, implied volatility often drops rapidly. This volatility decline can lower the option’s price even when the trader correctly anticipated the stock’s direction.
Selling Expensive Options
Elevated option premiums can generate more income for sellers, but those prices also signal that the market expects greater uncertainty and potentially larger stock movements. Selling options therefore does not inherently offer an advantage over purchasing them.
The decline in implied volatility that often follows an earnings announcement may help certain short-option positions. However, a sharp move in the underlying shares can more than offset that benefit and create a major loss. An uncovered short call has theoretically unlimited loss potential, while an uncovered short put can lose a substantial amount if the stock price collapses.
Credit Spreads
Traders seeking to take advantage of elevated pre-earnings premiums without accepting the full exposure of uncovered calls or puts sometimes use bull put or bear call credit spreads. Each strategy has a limited maximum profit and a limited maximum loss, though the maximum loss may be much greater than the credit collected.
A credit spread pairs a sold option with a protective purchased option of the same type. The position may benefit when the stock remains on the favorable side of the short strike and the contracts lose value, but a large earnings-related gap can quickly push the spread toward its maximum loss.
Closing the Position
After the earnings announcement removes much of the uncertainty surrounding the company, implied volatility frequently decreases.
The trader can then attempt to close the pre-earnings credit spread by repurchasing it. A profit results when the amount paid to close the position is below the initial credit after fees are considered. Still, the strategy is not consistently profitable, and an unexpectedly severe stock-price move may create either a partial loss or the maximum possible loss.
Updated on 8/3/2026.
Arthur Chachuna is a professional personal finance blogger, and the owner of Brokerage-Review.com.
He has been an avid investor for 25 years, and has a background in both applied math and programming.
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