Ally Invest Review for Options Trading 2017

July 11, 2017 0
Ally Invest Trading Dashboard

5/5

Review by:

QUICK FACTS:

-$3.95 + $0.50 per contract
-$0 Account Minimum
-$4.95 Option Exercise & Assignment Fee
-Web-based Platform w/ Advanced Options Analytics
-24/7 Customer Support

Get started today on Ally Invest’s secure site.


Ally invest is one of the newest players in the options broker realm. Having acquired TradeKing for $275 million in 2016, it’s safe to say Ally quickly transformed from an online bank to a very attractive DIY online brokerage firm essentially overnight.

Unlike many online brokers, Ally offers flexible pricing commission plans for active options traders as well as award-winning technology and zero maintenance or inactivity fees.

 

Options Trading with Ally in a Nutshell

One of the best aspects about trading options with Ally Invest is undeniable low-cost. High-balance and/or high-volume traders can take advantage of a $3.95 ticket charge + $0.50 per contract for all options trades. To be eligible for this competitive pricing, all traders need to do is make 30 or more trades per quarter, or maintain an average daily account balance of $100,000 or more.

If you’re an active options trader, 50¢ options with only a $3.95 base charge is highly attractive. This means one-lot iron condor only costs $5.95. That’s still less than the price most brokers charge for a single equity trade!

In addition to great pricing, Ally offers 24/7 customer support via phone and live chat.

 

Special Offers

Start investing at Ally Invest and get a $100 cash bonus or $500 in commission-free trades!

Switch to Ally Invest and get up to $150 in transfer fees reimbursed in qualified accounts.

Reduced pricing available for high-volume/high-balance traders. Learn More

 

Commissions

Active Trader (30+ trds/qtr) Rate: $3.95 + $0.50/contract

Regular Trader Rate: $4.95 + $0.65/contract

Option Exercise: $9.95

Option Assignment: $4.95

Outgoing Domestic Wire Transfer: $30.00

Ally Invest offers some of the cheapest rates for trading options in the industry. For traders looking to trade 10+ contracts at a time, you simply can’t beat Ally’s pricing.

Plus, option sellers can rejoice with a low fee of $4.95 per option assignment.

As with virtually all brokers, incoming and outgoing ACH transfers with Ally Invest are free. A lot of traders at The Options Bro frequently wire transfer cash out of their account to pay themselves on a weekly basis, and $30 per wire transfer at Ally is noticeably $5.00 higher than the industry average of $25.

 

Trading Platform

Ally’s options trading platform is web-based and surprisingly robust and capable of fairly sophisticated probabilities and analytics for options trading.

In addition to customizing all of the widgets by clicking on the “cog” symbol, you can select from two themes: dark (pictured) and light.

Main Dashboard

Ally Invest Trading Dashboard

The main dashboard features basic charting functionality as well as an option chain, watchlist, order status widget, and account summary. All of these elements are partially customizeable.

Option Chain

Ally Invest Option Chain

Ally Invest’s option chain is great. We didn’t experience any lags in loading data or quotes. It’s common for web-based option chains to lag significantly, especially when scrolling, but Ally’s is quick. Plus, it’s customizable and easy to use. Clicking on the box on the outer edges of the chain populates that strike in the Option Probability Calculator tool.

Option Probability Tools

Ally Invest Probability Calculator

With the Option Probability Tool, you can see the potential profit and loss for a potential or current options trade. In addition to the max profit and loss, you can account for hypothetical changes in volatility with the appropriate number of days until expiry.

 

Trading Data

All of the software and data provided on the platform above is free.

If you do make more 10+ trades per month with Ally, you are eligible to receive a streaming data system (including level II quotes, charts, news, etc) free of charge. Unfortunately, this is the only way to receive level II market data with Ally. They don’t offer streaming services for a fee to traders.

 

Options Trading Capabilities

Ally Invest offers full options trading capabilities, but naked options come with a hefty requirement. Perhaps one of the only downsides of trading options with Ally Invest is the high account value requirement to sell naked index and equity options, specifically naked equity calls. 

A minimum account requirement of $100,000 to sell naked index and equity options is arguably pretty steep. $25,000 to trade naked equity put options is more reasonable, considering the day trading requirement for accounts in the US is $25,000. But still, for options traders that are just starting out, the naked index option requirement with Ally might prove to be a bit of a barrier.

Undoubtedly, trading naked options involves a high amount of risk, but the margin requirements for Ally Invest are substantially higher than their competitors. This is definitely something active options traders should take note of when applying.

 

Customer Support

It’s reassuring to know an Ally Invest customer service representative always available via phone, chat, or email 24 hours a day, 7 days a week. Although there are no physical branches, Ally’s cyber-support is fantastic.

Whether you have a problem with your account or a question about a trade, someone is always standing by at Ally to assist you. We have used the “live chat” feature on numerous occasions, and responses have always been prompt and helpful.

 

Final Word

Ally Invest is simply fantastic for options trading. At the end of the day, you simply can’t beat the low cost. Offering advanced options probability and analytics tools makes the deal even better. If you’re one to take an occasional trading hiatus, zero maintenance fees and zero account minimums are essential, and this is truly where Ally shines.

The only area where Ally could improve is with their high naked option margin requirements. Traders who are just starting out and do not want to commit too much capital might find the $100,000 naked call requirement a little steep.

Having said that, with 24/7 customer support, $0.50 option contracts, an advanced trading platform, and no minimum activity or balance requirements…how could you go wrong?

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