by Silicon Valley Blogger on 2011-11-15 14

For a limited time, optionsXpress is offering a $100 cash bonus for all new account sign ups when certain requirements are met. You can find out more details below.

Ive been covering a number of online stock brokers here including the likes of Scottrade, TradeKing, ETrade and many more, as an exercise in discovering which sites out there are supportive of investors and traders alike.

I remember the old days when Id call up my stock broker or when Id visit my local Charles Schwab branch to talk to a representative who could help me work out the kinks in my investment portfolio. These days, there are slick new investment sites (online brokerages and mutual fund companies sites) that are available for us to use, providing us a highly convenient platform for our own investing activities. And interestingly, Charles Schwab has acquired OptionsXpress as part of Schwabs bid to provide its customers with a richer brokerage experience. They sought expertise in the futures and options area, and they found it in OptionsXpress.

OptionsXpress Review: A Broker For Stock Investing and Options Trading

Well theres a stock brokerage for everyone. If you happen to be looking for a stock broker that focuses its support on the more advanced aspects of investing and trading, then you may be interested in a site like OptionsXpress.

If you check out our post on the latest discount broker survey by SmartMoney. youll see how well OptionsXpress ranks among all other online brokers. This brokerage has received generally high marks, and heres why:

Awards

OptionsXpress has one of the cleanest sites around, but do they measure up to their look? Well, here are their notable honors:

• Barrons Best Online Broker for several years straight (from 2003 to 2006) and recipient of Barrons 4 stars for 10 straight years.
• Recipient of numerous industry awards and recognized as one of the best brokers over the past decade for certain categories (Trade Experience, Technical Trading Tools, Usability, Research and Customer Service Access)
• Forbes Best of the Web
• Smart Money Best Discount Broker. with 5 stars for tools and costs.

Open an OptionsXpress account, get $100. Or read more about this broker below.

For quite a while, they were tops in the broker race until ETrade took over. I then attributed this momentary eclipse to the fact that ETrade had expanded their investment product offerings and banking area, thereby coming across as the more all around broker. Subsequently, broker surveys showed that OptionsXpress could improve in areas of customer service and banking services, even as they scored pretty highly for their technical tools and the customer trading experience they offer. Well, they have recently addressed these issues by joining forces with Charles Schwab. Lets talk about that for a moment.

Integration With Charles Schwab

In the first half of 2011, we were greeted with the news that Charles Schwab, the well-known discount broker, was to acquire OptionsXpress. Today, the acquisition has transpired and both entities are working on integration plans in order to provide their customers with a better trading experience, especially in the advanced options trading arena. As part of the integration, transfers and transactions across Schwab and OptionsXpress will incur no fees.

Because of this partnership, customers of both companies can expect to see complementary services that can promise them a much more well rounded investment experience. This new entity will now be able to provide advisory and other financial services for general investors, banking services through Schwab Bank as well as enhanced trading functions through OptionsXpress. Customers will have access to more complex options and futures trading strategies using high quality trading platforms, while having the ability to do their banking under the same umbrella.

Pricing

With regards to pricing and rates, Id classify them as middle of the pack among online brokers with commissions in the $1.25 to $1.50 range per options contract; with fees at the lower end, the more actively you trade. Same thing goes for their price per futures contract ($2.99 if youre a high volume trader; fee range for futures is $2.99 to $6.99 depending on activity). As for stocks trading, theyre in the same boat as ETrade, at $9.95 per trade.

Investment Products and Virtual Trading

OptionsXpress clearly shines in the areas of options and futures. Theyve got strong technical support in these areas, but they also offer a great environment for those investing in stocks, ETFs, bonds and mutual funds. They allow perks such as free broker-assistance, free account transfers ($100 credit if you transfer a minimum of $2,000 to them) and the ability to open any account type. Youll also get free Morningstar reports, stock tools, access to over 4,500 no load funds and a well-integrated bond platform that gives you access to municipals, corporates, treasuries, CDs, etc.

And heres another bonus: I like how they have a Virtual Trading feature that allows you to trade without risk: if you open an account with them, you can then set up a virtual trading account where you can practice trading as much as you want!

Trading Tools and Resources

Heres where OptionsXpress rules. If you visit their Tools Center, youll see their tools neatly lined up with learning videos and tutorials that are classified according to customer experience/education levels. This part of the site is extremely well organized and comprehensive. Heres a taste of what they have:

• To help you FIND your next investment, check out their whimsically named tool called the Dragon which is their powerful search engine for options and stocks. Other applications help you screen for analysts recommendations and for investing opportunities based on market sentiment, trading patterns and chart patterns.
• To help you ANALYZE your investment positions, theyve got applications that include a Trade Calculator that helps you gauge risk vs reward, an Option Pricer that shows you how market conditions can influence options pricing, and your standard systems for Quotes, Watch Lists, and Alerts.

A visit to their tools section will uncover a myriad of helpful functions, including The Screener, StrategyScan, Trading Patterns, Chart Patterns, Position Analyzer and so much more. The standout is their Xtend Software. which is a sophisticated downloadable trading software application for more serious and active traders.

Investment Education and Research

Like many new-fangled brokers out there, OptionsXpress gives you a free investment education once you sign up with them. I like how they categorized their education tracks according to what it is you want to learn about. For information on any investment product (options, futures, stocks, bonds, ETFs and mutual funds), they have video tutorials that cater to the novice, intermediate and advanced investors. There are also demos, newsletters, webinars and live events you can attend to beef up your knowledge. They also go the extra mile by giving you access to a Personal Coach wholl provide you weekly one-on-one coaching sessions, self-tests, training materials and a hotline.

Usability, Ease of Use

Can this brokers website be any slicker? This broker prides itself for being one of those rare sites that gives you one central account login to access ALL their investment platforms. I once worked at a couple of financial institutions where behind the scenes, I dealt with a spidered network of systems that had to be integrated. Generally, systems integration and data processing behind the pretty broker screens arent as tight as what you may be led to believe. So this ability to trade everything from options to bonds in the same account is actually a plus.

Closing Thoughts

OptionsXpress is geared toward active traders and investors, particularly those who are interested in advancing into other types of trading (e.g. commodities, futures and options), but their integration with Schwab makes them even more accessible to all types of investors. Still, long term investors may also want to consider brokers like Scottrade. ETrade or Sharebuilder (the latter two also have well developed banking and money management platforms), or a mutual fund company like Vanguard or Fidelity.