TradeStation vs. Tastyworks (2021) • Benzinga
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Options trading is a good way to generate additional income, amortize your risk, or diversify your portfolio through increased exposure to certain indices and stocks. Since options trading is more complex than stock trading, you need to be selective when choosing a brokerage.
Benzinga has analyzed 2 of the top players on the features you are interested in – who it is for, trading fees and commissions, and research offers. Fortunately, you can sign up with either one and enjoy low trading fees and commissions.
Here’s a quick rundown comparing TradeStation and Tastyworks:
Who is TradeStation for?
TradeStation really stands out for options traders because it is a 0 commission platform. However, the brokerage can serve you if you fall into one of these categories:
- Expert traders: If you are an expert trader, TradeStation provides a platform where you can pre-test proven trading strategies.
- Active traders: TradeStation also offers various benefits to active traders. Brokerage fees are usually volume based, so you will incur lower costs if you are a frequent, high volume trader. You can also lower your software costs for being a frequent trader.
- Beginners: As a newbie trader, TradeStation is a great broker because it has a simplistic design that makes it incredibly easy for you to understand the tools of trading. You can also take advantage of its customizable platform to create a dashboard tailored to your trading needs.
- Institutional investors: If you are an institutional investor, you will benefit from a handful of services that offer complete and tailor-made trading solutions. The brokerage has extensive exposure to serve institutional investors in North America, Europe, Latin America and other global markets. You will also have access to electronic execution services on several asset classes, including currencies and stocks.
Who is Tastyworks for?
If you are an active trader, Tastyworks makes your life easier with low prices, convenient technology and great customer service. The following investors will benefit from using Tastyworks:
- Active traders: Tastyworks is a great brokerage firm if you are an active options trader looking to become more skilled at executing trades. You can access and use this brokerage through its website or mobile app.
- Beginners: If you are new to options trading, Tastyworks offers a great learning experience. The platform allows beginners to watch expert traders execute trades in real time.
- Experienced traders: Tastyworks is also aimed at experienced options traders looking for advanced options to execute specialized trades by providing valuable educational content.
You can open an individual, trust or joint account with Tastyworks, with the option of keeping it as a cash, margin or retirement account. With a margin account, the broker lends you money to trade and use the available trading strategies. With spot trading, you have to fully fund your trades, but you face restrictions on using certain trading strategies.
The retirement account provides investors with tax advantages while allowing you to use basic trading strategies and defined risk spreads. Tastyworks offers traditional Roth, SEP, and IRA account options to its clients. You can open a retirement account as an individual, an entity or jointly.
TradeStation Fees and Commissions
TradeStation’s 0 commission on stock trades only applies to the first 10,000 shares per trade. For each order that exceeds 10,000 shares, a charge of $ 0.005 per share is imposed on the shares that are in excess. The brokerage house offers 2 pricing plans: TS Select and TS GO. TS Select requires a minimum funding of $ 2,000 while TS GO does not have a minimum funding. TS GO tariffs only apply to trading on the web and mobile apps.
If you subscribe to the TS GO plan and trade using the brokerage’s desktop platform, there will be an additional charge of $ 10 for each option and stock trade made.
|Actions||$ 0 per transaction|
|AND F||$ 0 per transaction|
|Options||$ 0.50 to $ 0.60 per contract + $ 0 per transaction|
|Futures contracts||$ 0.85 to $ 1.50 per contract per side + $ 0 per trade|
|Mutual fund||$ 14.95 per transaction|
|Obligations||$ 14.95 per transaction|
TradeStation charges a monthly inactivity fee of $ 50 if you fail to maintain an average end-of-month balance of $ 2,000, fail to complete at least 5 trades within 12 months of funding, or within 12 months of funding. 12 months following the anniversary of the first funding date. However, the minimum account activity fee is relatively easy to maintain.
Tastyworks fees and commissions
Tastyworks now offers capped commissions on stock option trades at $ 10 per step.
- For stock options and ETFs, the brokerage charges an opening commission of $ 1 per contract but does not charge a closing commission.
- For stocks, the brokerage does not charge an opening or closing commission. However, all stock transactions incur a clearing fee of $ 0.008 per share.
- For options on futures, Tastyworks charges an opening commission of $ 2.50 and a closing commission of $ 0. Futures option transactions incur a clearing fee of $ 0.30 per contract.
- For futures contracts, the brokerage charges $ 1.25 per contract at the opening and $ 1.25 at the close. Futures transactions also incur a clearing fee of $ 0.30
Bank charges associated with Tastyworks include:
- Domestic check ($ 5)
- Outgoing domestic wire ($ 250)
- Foreign check ($ 10)
- Outgoing foreign wire ($ 45)
- Dividend check ($ 5)
- Handling of Restricted Inventory ($ 205)
- IRA closing costs ($ 60)
- ACH Correction Notice ($ 5).
The brokerage also charges trade-related fees which include option regulatory fees, SEC fees, NFA fees, exercise and disposal fees, and clearing fees on futures, stocks and the options.
ACH deposits and withdrawals are free. There is also no annual fee for maintaining an IRA account.
TradeStation Research Offers
TradeStation has various research offerings on its website. While you won’t get the most comprehensive information about the companies you want to invest in, the platform gives you access to Credit Suisse and Market Edge stock reports.
There are also videos and articles that provide an overview of the basics that a beginner needs to make their first trades. In addition to owning a designated television network, TradeStation also hosts in-person training events across the United States in the area of trade and investment.
If you’re a futures trader, you can check out their Learning Center, which has how-to videos on futures trading and the Nasdaq-100 index. You will also learn about margin trading and how to place an order for bitcoin.
TradeStation also provides over 150 indicators that you can include in your testing strategies. You can also access over 40 years of intraday data and over 90 years of stock trading data.
Tastyworks Research Offers
Tastyworks offers a handful of research tools and offers that any options trader can use. Tastyworks lets you create watchlists and portfolios where you can watch the brokerage’s seasoned investors execute trades in real time. You can monitor all transactions live without leaving the platform. The Tastyworks Video Archives section also gives you access to more video content. It also hosts free live events across the United States.
The platform is well designed and allows you to get reports, charts and other useful information that you will need to make the right trading decisions. If you need a more in-depth analysis of your current portfolio risk, Tastyworks provides a Quiet Foundation platform where you can register for free and monitor all of your brokerage accounts. The platform also offers educational content, most of which is used by expert options traders.
The company also recently launched Luckbox Magazine, a digital publication that offers advice to investors looking to make smart investment choices based on various probability models. The brokerage’s professional traders also publish their trades and results, so you can choose your favorites and follow them to receive valuable trading information.
TradeStation vs. Tastyworks Bottomline
Although TradeStation does not charge commissions for options traders, it does have advanced software that is better suited for expert traders. Tastyworks, on the other hand, is a discount brokerage firm designed for active options traders. The low trading fees and educational content available on the Tastytrade network make this brokerage firm the ideal tool if you want to improve your skills in portfolio risk analysis when trading.
Frequently Asked Questions
What types of traders prefer TradeStation?
What types of traders prefer TradeStation?
Experienced and professional traders love platforms, costs, research, and tools.
How many trades per day can you make on Tasty?
How many trades per day can you make on Tasty?
Tastyworks allows up to a maximum of 3 transactions per day.