Firstrade Launches Real-Time Option Greeks & Implied Volatility

Firstrade Securities, a leading online brokerage, has launched an iteration of Greeks to its mobile app. The integration provides customers with the ability to quantify different market factors that could affect the price of options trades, before placing an order. 

This update includes Delta, Gamma, Theta, Vega and Rho calculations, which are embedded into the application, allowing users to quantitatively measure sensitivity of an options contract’s price to time decay, implied volatility, and underlying security price.

The enhancement also provides customers with Implied Volatility (IV) data, giving insights by way of market forecast that analyzes potential movement of securities assets. The latest update is part of ongoing efforts to improve functionality on the mobile app when placing an option trade.

What Are The Option Greeks?

The “Greeks” are a set of calculations that allow traders to gauge risks that could affect the price of an options contract. When used correctly, Greeks can empower traders to make more informed decisions about which options trades to undertake, and when.

Delta allows traders to analyze whether an option will expire “in-the-money” (ITM). This means that the strike price of an option is below a call, or above a put in respect of the underlying asset’s market price. In essence, Delta measures the expected price movement of an option for every $1 of movement in the asset. Gamma then corresponds to how much the Delta might change, if the stock price moves.

Theta refers to the ability to measure the value an option might lose on a daily basis as it approaches its expiration date. This allows customers of the brokerage to measure price impact over time, up to expiry.

Lastly, Vega and Rho allow for different forecasts entirely. Vega focuses specifically on large price swings, and how the asset may be reciprocally impacted, with Rho providing insights into interest rate changes on an option.

“Adding the Greeks to our platform is part of our mission to empower investors when trading options. The Greeks integration is part of major planned enhancements across our entire options offering.” said John Liu, CEO of Firstrade.

Kiplingers Recognizes Firstrade Options Progress

A recent wealth management piece by Kiplinger's recognized Firstrade as the “Best Broker for Options Traders” due to its competitiveness around commission and contract fees when placing options trades. As noted by the report, other competing firms typically charge between 50-65 cents per contract, whereas Firstrade waives these fees on options trades.

Firstrade took plaudits as the overall winner of the options review, due to its “below-average” fees for broker-assisted trades, and overall competitiveness on margin accounts.

The Firstrade Story

Since 1985, Firstrade has been a member of the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).

The brokerage is one of the market leaders among US brokerages, offering commission-free trading on stocks, ETFs, options, mutual funds, fixed income, and retirement accounts through its respective iOS, Android, and Web platforms. The brokerage recently launched a new customer initiative, providing customers that open and fund a new account with cash awards of between $50 to $4,000 depending on the amount deposited. 

Options involve risk and are not suitable for all investors. A separate client agreement is needed. Read the Options Disclosure Document, Characteristics and Risks of Standardized Options, prior to trading options.

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