Tastytrade Rating: 
Basics
- Stocks & ETFs: $0
- Options: $1.00 per contract to open, $10 maximum, $0 to close
- Mutual Funds: not available
Overview of Tastytrade
If you're considering opening a brokerage account with Tastytrade, it's likely due to the broker's strong reputation. Tastytrade has built a name for itself with a unique approach, especially when it comes to investment technology and options trading.
This Tastytrade review will explore some of the broker’s standout features, mention a few potential drawbacks, and help you decide if Tastytrade is right for you.
Keep reading to learn more.
Getting Started With Tastytrade
Before diving into Tastytrade’s offerings, it's helpful to know a bit about its background.
The team behind Tastytrade has deep roots in the investment world, with over 40 years of experience.
Starting as floor traders at the Chicago Board Options Exchange, Tom Sosnoff and Scott Sheridan advanced through various stages in their careers over the years following their time on the exchange.
The two launched a popular trading platform called thinkorswim in 1999 and developed it for a decade before selling it. After that, they founded Tastytrade in 2011, aiming to create a new way for customers to engage with the markets. The tools and products at Tastytrade today reflect this mission.
Today, Tastytrade provides one of the most innovative options trading experiences, and the broker also offers its own line of futures products and a dedicated learning network called Tastytrade.
Account Types
Tastytrade offers a range of account types similar to those found at other brokers. You can open individual cash accounts, margin accounts, IRAs, and more. Setting up an account is straightforward, and you can open multiple account types if desired.
Here's a breakdown of the account types available:
The Works – The Works is an individual margin account that includes permissions to trade all of Tastytrade’s products. Whether you want to create advanced options strategies, trade futures, or short stocks, The Works account covers it.
We appreciate that Tastytrade offers an account specifically designed for accessible trading. Applying for The Works takes under 5 minutes, and approval usually comes within a day or two.
Other account types include:
Individual (Cash and Margin) – These accounts are similar to The Works but with fewer permissions. Tastytrade evaluates how much risk is suitable based on each investor’s assets and experience level.
Retirement Accounts – Tastytrade offers Traditional IRAs, ROTH IRAs, and SEP IRAs.
Corporate Accounts – Accounts for businesses rather than individual investors.
Trust Accounts – Accounts designated for a trust.
International Accounts – Available for international customers (excluding Canada).
Custodial Accounts – Tastytrade is working on adding custodial accounts, including UGMA/UTMA and Coverdell accounts, to their lineup soon.
Funding Options
Funding options at Tastytrade are similar to those at other brokers. You can fund your account by ACH, wire, check, or ACAT transfer.
ACH transfers are set up by linking a U.S. bank account to Tastytrade, enabling quick and easy transfers. ACH funding can take up to 5 business days, but accounts with at least $2000 get instant ‘trading funds’ for faster access.
Wire transfers are the fastest way to fund a Tastytrade account, though they require setup through your bank and providing Tastytrade account details.
Check deposits and ACAT transfers take a bit longer, with checks clearing in about 3 days and ACAT transfers taking up to 10 days. Using an ACAT transfer lets you move an entire brokerage account, including open positions.
Currently, digital wallet services like PayPal cannot be used to fund a Tastytrade account, but this may be added in the future.
Available Securities
One of Tastytrade’s strengths is its selection of securities, which all trade on the same platform or mobile app.
Available securities include:
- U.S. listed stocks
- ETFs
- Options
- Cryptocurrencies
- CME futures (e-mini and micro)
- Small Exchange (Smalls) futures
However, some popular securities are not available at Tastytrade.
Unavailable securities include:
- Mutual funds
- OTCBB stocks (penny/pink sheet stocks)
- Foreign stocks
Permissions
For stocks, ETFs, and options, no special permissions are needed beyond your allowed options trading level. For futures and cryptocurrencies, however, you’ll need permission from Tastytrade, which can be enabled from the ‘Trading Preferences’ page. Note that crypto trading is not available for users in India, New York, or Hawaii.
Cryptocurrency Trading
While it’s nice that Tastytrade offers access to some popular cryptocurrencies, there are a few limitations to be aware of.
Firstly, Tastytrade does not offer a ‘wallet’ function for crypto accounts. Instead, an account is created at Zero Hash LLC for you when you get permission to trade crypto. You can only open and close long positions; there are no crypto derivatives or short-selling options.
Additionally, all digital assets are priced in U.S. dollars, and it’s not currently possible to trade one crypto against another.
Available cryptocurrencies at Tastytrade include:
Investor Resources
A key feature of any broker is the support offered to investors. At Tastytrade, there are multiple resources available:
The first thing you'll likely notice is the detailed FAQ and help sections. These include articles and guides on almost every aspect of the platform and brokerage. The information is easily searchable with a built-in search tool.
Whatever information you need, there’s likely to be an article on it.
If you can’t find what you’re looking for in the help center, you can access live help through the chat and AI assistant tool. This is located at the bottom-right of every page on the website and provides quick access to all help materials.
Open Tastytrade Account
Get $250 for each person you refer with this referral link.
Open Tastytrade Account
Follow Feature
Another valuable resource for investors is the Follow feature.
The Follow feature is available on the trading platform and can be found under ‘follow.’ You’ll need to accept a disclaimer that the ideas presented are for educational purposes only to continue.
Tastytrade has a team of in-house traders, including the company’s founders, who make up the Tastytrade trading team. The Follow feature is essentially a live feed showing trades that are opened and closed, displaying details like strike price, cost, profit probability, and reasoning behind each trade.
You can even follow specific traders whose style matches your own. Some trade more aggressively than others, and there’s also an account size feature to show the capital each trader is working with.
TASTYTRADE
In addition to the Follow feature, there’s a live video feed throughout each trading day from TASTYTRADE, the broker’s educational platform. Industry experts and featured traders frequently appear, with discussions that are highly educational.
Trading Platforms & Technology
One of Tastytrade’s most popular features is its trading platforms. You can use the browser interface, mobile app, or desktop platform to place trades in any available securities.
The desktop platform is lightweight and fast, making it one of the most responsive in the industry. Beyond functionality, it includes various smart analysis tools that make building strategies easy.
The Curve
The Curve feature lets you visualize the profit/loss potential of any trade you plan. No complex calculations are needed to get valuable risk/reward information. The Curve also displays data like market maker moves and profit probabilities.
Intuitive Order Control
Another great aspect of the trading software is its intuitive order control. By right-clicking an open position, you can roll an option contract to a later expiration or set a closing bracket order based on a percentage gain or loss.
Charting
One area where Tastytrade has room for improvement is charting. The basic charting on desktop, mobile, and browser platforms works well, but there are limited third-party indicators. Some alignment issues can also occur when using specific timeframes and indicators.
Although Tastytrade’s charting has improved, it’s still a work in progress.
Open Tastytrade Account
Get $250 for each person you refer with this referral link.
Open Tastytrade Account
Fees and Commissions
Tastytrade’s fee schedule is another highlight worth noting.
In some cases, Tastytrade’s fees are lower than other brokers, while in others, they are on par. Tastytrade’s pricing rewards larger orders.
Here’s a breakdown of Tastytrade fees and commissions:
The best deals are on options, stocks, and ETFs, with zero commissions for stocks and ETFs. You only pay to open an options contract for stocks, ETFs, or futures.
Notably, there’s a $10 cap per leg for stock and ETF options, meaning even a 100-lot position would cost just $10 in commission. This is a nice feature for traders dealing in multiple contracts.
Tastytrade Pros and Cons
As with any broker, Tastytrade has strengths and weaknesses. Here’s a summary of its pros and cons.
Tastytrade Pros
- Unique options trading approach
- Low-cost commission schedule for options
- In-house futures products (Smalls)
- Extensive investor resources
- Trade inspiration from active investors
Tastytrade Cons
- No pink sheets
- No foreign exchange-listed stocks
- Limited cryptocurrency features
- Charting lacks some key functions
Summary of Our Tastytrade Review
Tastytrade has a lot to offer as a broker, especially for options traders who appreciate a hands-on approach.
The Follow feature and live educational content provide direct insights from the brokerage team, while low fees make trading affordable compared to many brokers.
It’s also convenient to trade various securities from a single platform.
Tastytrade may not be the best choice if you need access to international and penny stocks, or if you rely heavily on advanced charting.
Overall, Tastytrade has more positives than negatives, making it worth considering.
Open Tastytrade Account
Get $250 for each person you refer with this referral link.
Open Tastytrade Account
Updated on 11/12/2024.
|