Categorized | Options Trading

Why does my online brokerage charge a premium for options trading ?

Thye charge $0.75/contract plus the $9.99 commission fee. Why the per contract charge ? Are they trying to discourage Options Trading ? Are they implying that options trading is more profitable than stocks ? I know the writer of the contract deserves a premium as incentive to write the option, but it appears that my brokerage isn’t involved with writing them, some random individual in the market is.

That $.75 charge is a pass through charge, that is what your on-line broker is charged for your order $1.50 per turn (a buy and a sell) is a good rate… If you’re upset about that try this… the reason you don’t see a charge for trading stock is because your on-line broker collects a fee from the market center they send the order to for execution, in addition to your $9.99 fee. Cha ching!!!!

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