In this article, I’ll share the list of best stock brokers for options trading. While choosing a broker, options traders have the unenviable task of precisely balancing a conglomeration of requirements: low brokerage charges, excellent customer support, real-time options data, not to mention higher margin for option selling (writing) advanced charting platforms & screening tools that must rock their world.
Options trading is a complicated & advanced level of trading. Options are a highly lucrative derivatives products. We just have to pay a nominal amount as premium. Who are into trading for a long time used to trade over future and option which gives investors an opportunity to earn superlative profits (or losses).
When we look for an options trading platform the platform we are choosing must be credible reliable and faster as we need to execute trades in real-time with much faster speed to beat the volatility.
Key point for choosing option trading Stockbroker
Even all the trading platforms out there in India do not provide up to mark data or say option chain & derivatives data over their trading platform. In India, almost all brokers to provide trading in the future and option segment but few of them are best for options trading.
Brokerage- First and foremost thing is that brokerage should be as low as possible so you do not end up paying your profit as a brokerage, whenever you trade over options & futures make sure that whichever broker you choose they don’t charge brokerage on basis of per lot size. Whichever broker you should charge flat or fixed brokerage irrespective of the number of lots, which will help you to save lots of brokerage charges.
Margin: I feel that higher margins higher the risk of losing money. It’s better not to take margin for trading. This is also an important key point for a small trader who takes a higher position. Most people also look for a higher margin for trading over future and option especially when people are interested in writing (selling) options.
Trading platform & Charting: Whichever the broker you choose they must be best in terms of technology tools because option and futures trading is one of the advanced tradings & you need a robust system where you can analyze derivative data & options chain. The broker should also support multiple charts simultaneously to trade in real-time with multiple scripts in a single click.
Mobile application: In India, not every stockbroker provides option chain & derivative data over their mobile application. Make sure when you open an account with any broker should provide option chain data on their application so you do not need to sit all the time in front of the computer to trade.
Upstox is one of the best brokers for options trading in India. They provide option derivative data over trading platforms & also mobile applications too. Even they provide comparatively higher margin than peers.
Brokerage: I put Upstox on the first place because they have very less brokerage charges for future and option they charge flat ₹ 20 or 0.01% (whichever is lower) per trade maximum so you do not need to worry about your lot size.brokerage for options trading is Rs 20 per executed order.
Trading Platform: Upstox mobile app allows you to check option chain & derivatives data through their mobile app so which make very easy to trade over mobile Application too & another benefit is that whenever you trade over upstox in future & option segments there is no condition as that you cannot sell or buy deep out of the money call and put.
Option Chain in Web Based Trading Platform
Option Chain in Mobile App
Margin: Upstox gives up to a 3-4x margin on writing options on intraday.
Zerodha
Zerodha is one of the topmost stockbrokers in India. They have everything whatever you need as option trader but only concern with them is that sometimes new long positions in Banknifty/Nifty options are placed outside the range allowed by the mandated Open Interest restriction (i.e OTM, deep OTM strikes & deep ITM strikes), the order is rejected & the below error is displayed.
Strike price is outside the allowed range. Try a strike closer to the spot price.
The restriction is only for long options positions but you can place fresh short option positions.
In the case of the Zerodha position limit in equity index options, Banknifty/Nifty option contracts are higher than Rs.500 crores or 15% of the total Open Interest (OI) in the market in Banknifty option contracts. Whenever Zerodha as Trading Member is breached 15% limit of total OI in Banknifty option contracts, they will block Bank nifty option trading outside of the range specified.
For example, let’s assume Bank nifty is trading at 24000 – and due to the open interest restriction the RMS team has set the range as 1% from the spot – you will not be allowed to place a buy order 240 points above or below, i.e you will have to place your buy order between 23760 – 24240
Brokerage: They charge Flat ₹ 20 or 0.01% (whichever is lower) per executed order on intraday trades in any segments including F&O & Free delivery Trades.
Leverage: Zerodha offer 3-4 times or 35-40% NRML margin.
Trading Platform: Zerodha partnered with the Sensibull Platform which is a simple & advanced Options Trading Platform. You can also trade through the KITE trading platform but they don’t provide option chain data.
Fyers
Fyers is another good option after Zerodha only if you will do trading over their platform you will feel the difference. They provide one of the robust trading platforms in India for trading. They provide the best charting out there in the stock brokerage industry.
Brokerage: Equity Intraday & Futures Brokerage is ₹20 per executed order or 0.01% (whichever is lower). In option trading, you will be charged flat ₹20 per executed order.
Angel Broking is one of the oldest & prominent Indian full-service brokerage firm established back in 1987. If you look at their brokerage plan it depends upon the plan (elite, classic, premier, preferred) you choose.
5paisa is known due to its lowest brokerage in the stock brokerage industry. They charge brokerage as low as ₹10 per executed order irrespective of lot size or turnover value. This is the best broker for those who are looking for low brokerage on their trades. 5paisa is considered as one of the most economical stockbrokers firm in India.
Derivatives intraday margin
Derivatives
Intraday exposure/Margin
Futures
3 x
Options long
1 x
Options short
3 x
On the lighter note, I have above-listed brokerage firms which are the best broker for options trading, In India. I believe that brokerage is one of the important factors to look out when you trade over options. At the same time, I also suggest you to never compromise the credibility & and reputation of the stockbroker.
If you will check there are few brokers who charge brokerage as low as 5 rs per order but you never know when they will shut down their business. Make sure that you open an account with one of the top brokers for options tradings.
