Assumptions and Simplifications

We made a few assumptions and simplifications when creating the price comparison data. In general, we have attempted to be conservative when it is not possible to know the exact price and we have ignored fees other than the core commission charges.

Some brokers offer different pricing based on the market price of the option contract itself. For example, closing an option contract with a price of 5-cents or less might be free. One broker's "standard" pricing is also based upon the market price of the option contract. Since it is impossible to accurately estimate the number of contracts a user might trade at a given market price, we have chosen to be conservative in our estimates and ignore discounts for inexpensive options. If you trade options with prices below the stated thresholds at those brokers, you may realize better pricing than we have estimated.

Some brokers tier the pricing based on how many trades you make in a given period such as a month, quarter, or year. Normally users will simply receive the lower or higher pricing tier depending upon how much they trade, but we have calculated prices using each tier up to the level of the next tier, then we switch to the pricing of the next higher tier.

Some brokers do not charge commission on the first few trades in a given period of time, particularly if you maintain a mimimum asset balance with that firm.  We have not shown the benefit of those commission-free trades in our price comparisons since our comparisons do not attempt to show the number of individual trades made in any given period of time.

Some brokers offer highly discounted pricing if you maintain a minimum balance with that firm.  We have attempted to show that discounted pricing as separate plans where possible but otherwise default to the plan with higher pricing which is available to everyone.

Many firms offer discounted pricing to the most active traders and the traders with the greatest assets, but they do not publish those rates on their websites.  We have not included any discounted pricing which is not publicly disclosed.

Many firms charge extra for broker assisted trading, typically when you call to place a trade. Since our focus is on the comparison of the online software, we have ignored any additional charges for broker assistance.

Certain vendors pass along exchange charges for specific index options such as SPX, VIX, and OEX. We have ignored those additional charges.

We ignored any margin interest calculations or charges.