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Option Alpha is a solid platform that offers robust algorithmic options trading automation tools and plenty of educational resources to learn options trading. The platform does not charge commissions and currently offers a free 30-day trial. The educational resources they offer for free are simply mind-blowing. If you want to learn options trading or go ahead with automated trading, the Option Alpha trial is well worth your time.
Pros:
- Programmable automated trading bots
- Strategy exchanging with other traders in community forums
- Highly useful backtesting tools for testing trading theories and principles
- Historical stock price data; reduces need for Yahoo Finance and other 3rd-party software
- No coding or tech skills required
- Simple UI/UX and 1-click strategy implementation
Cons:
- Limited number of trading account integrations
- No direct portfolio management available
- Limited research with basic package
Options trading is a risky endeavor, but with informed decision-making and quick thinking, there’s the potential to make quick profits. This is where Option Alpha (sometimes stylized as “Optionalpha”) comes in; it is an algorithmic options trading software and learning platform that can help you become a successful options trader.
Option Alpha aims to assist you with automated options trading. The platform emphasizes making informed and educated decisions, and it’s user-friendly to help both novice and experienced options traders.
Honestly, Option Alpha is a pretty quiet service. Until recently, we hadn’t heard much about it, and they don’t seem to spend much on publicity or advertising. That’s why we were skeptical about whether it could compete with the bigger names in the automated trading industry like TrendSpider, TradingView, and MetaTrader 4. Let’s take a look at their service to see for ourselves.
What is Option Alpha?
Option Alpha is a subscription-based software providing access to a wide range of options trading tools, educational resources, and market insights to enable informed decision-making.
There are two main aspects of the Option Alpha platform that you can make use of as an options trader: educational resources, and an automated trading platform.
- Educational resources: Access vast educational content and learning resources to learn options trading extensively. Almost all Optionalpha educational resources are free!
- Trading automation: In addition to building a solid base on options trading, you can perform algorithmic options trading and stock trading with the platform. Option Alpha provides quite a few sophisticated research tools for adequate investment analysis.
Next, we’ll see what makes Option Alpha a handy stocks and options trading platform and whether it has any drawbacks.
Option Alpha Educational Resources
As an aspiring options trader or a seasoned pro, you might be wondering – what learning resources will you find at Option Alpha? Let’s take a look.
Courses
Kirk Du Plessis, a former investment banker and the founder of Option Alpha, instructs nine courses in total, organized into three sections – beginner, intermediate and advanced. Each course comprises multiple lessons.
The beginner-level courses cover the basics of options trading including entry-exit points. The intermediate level introduces you to three different strategies – bullish, bearish, and neutral. Finally, the advanced level focuses on portfolio management and trading adjustments.
(By the way, if you’re looking for a detailed options trading course, I highly recommend you check out our review of the Rockwell Trading Option 101 course.)
Strategies
The strategy section introduces you to all the trading strategies you can follow as an options investor.
You will find a detailed discussion on each of the strategies. Typical discussion includes:
- Market outlook for the chosen strategy
- How to set up trading
- Payoff diagram
- When to enter
- When to exit
Here’s an example of a short put payoff diagram.
Miscellaneous Resources
Optionalpha also offers several other resources, such as:
- Tutorials
- Workshops
- Podcasts
- Blogs
In addition, the platform provides comprehensive discussions on twelve different finance and investment topics and a full list of glossaries. Some topics are automated trading, equity investment, economics, financial markets, financial theories, portfolio management and risk management.
Check out our comprehensive review of the best options trading courses.
Option Alpha Features: How it Works
For those considering making the switch to Option Alpha, let’s have a closer look at the Option Alpha trading assistance platform, and its dashboard.
1. Bots and Trading Automations
Programmable and bots are the main features of Option Alpha. Simply put, bots are small executable programs that help you automate your entire trading process based on predefined conditions.
For example, when you trade, typically you scan the market for opportunities first. Then you analyze the data and make decisions to execute the trade if it meets the criteria. The Option Alpha bots follow the same procedure.
Things you need to set up for your automation bots includes:
- Name and icon
- Trading allocation of positions you would allow the bot to trade from your portfolio
- Daily and total position limits
You can create a bot window from scratch or use the bot wizard to make things quick and easy. The bot automation wizard lets you choose predefined and pre-programmed options, such as:
- Trading and position frequency: Sequential, weekly, monthly, or quarterly.
- Position symbol: You can search for any symbols here in the search box
- Trading strategy: You can indicate the predefined trading strategy that you want your bot to follow. Examples include long call, long put, iron condor, iron butterfly, and several others.
- Expiration: You can have any specific expiry date or a range for your contracts to expire
- Strike: Here, you can set the triggers for your bot to execute a trade. You can set various indicators such as delta value, total price, the percentage change of price, dollar value change of underlying asset, and value and percentage change of the leg.
- Amount: You can define the allowed limit of contract value for your bot in terms of the quantity of contracts, risk allocation limit, and percentage of the bot’s total allowed trade limits.
Here is a typical workflow showing step-by-step how a bot works.
2. Programming the Entry and Exit Criteria
Perfect entry and exit are the trickiest part of an options trade. Option Alpha lets you program your bots with excellent detail and include every possible scenario of four categories, which are:
- Opportunities (Entry)
- Positions (Exit)
- Stocks
- Indicators
- General Factors
For example, you can chalk out the opportunities for your bot to look at as entry criteria. You can set a specific rate of return, bid price, call leg, and profit probability.
Similarly, you can choose specific criteria for each stock to look for. The bot will track and check the pricing and volume changes with your preset criteria. Interestingly, the bot will follow the recent pricing changes and moving averages to identify any unusual changes.
Option Alpha lets you include several technical indicators in your calculation when choosing your trading criteria. Such as:
- Intraday technical indicator (buy/sell/neutral)
- 14-day technical indicator (above or below the set value). You can include several technical indicators in this calculation, such as ADX, RSI, SMA, TRIMA, etc.
You can also indicate the general market conditions such as market hours and day of the trading.
3. Trading Account Integration
Option Alpha does not offer brokerage or direct portfolio management services. Instead, the platform lets you connect your external trading accounts with it. Then you can execute trading directly through Option Alpha; however, the actual trade will take place in your broker’s account.
At the time of this writing, Option Alpha supports integration with the following brokers:
- TD Ameritrade
- TradeStation
- Tradier Brokerage
In addition, you can also manually add your Paper Trading account.
Option Alpha lets you enjoy some exclusive discounts and cash bonuses when you trade using your Tradier Brokerage and TradeStation accounts.
In addition to the zero fees and zero commission per trade and contract, you will also get the following cash bonuses for funding your Tradier Brokerage account after connecting Option Alpha.
- Any amount below $5,000: $50
- At least $5,000 or more: $100
- At least $100,000 or more: $300
TradeStation also offers similar bonuses and exclusive fees for Option Alpha traders.
4. Backtesting
Backtesting is an exclusive Option Alpha feature where you can test your options ideas with a simulation before putting your money in it. Option Alpha’s backtesting helps you with the following tasks:
- Historical data analysis: The simulation gives you real-time analysis based on historical data once you set your strategic criteria.
- Easy tweaking: Not happy with the results? You can simply tweak any settings or criteria and see an updated result as often as you want.
- Target setting: That’s how the term backtesting has come. You can set a profit or loss target for your contract and let the algorithm decide other criteria through backtesting to achieve the target.
- Top ideas: Option Alpha makes it super convenient by showing all the top backtest performers within a single page, which can be an excellent source for your trading ideas. The platform ranks the top performers based on returns, CAGRs, win rates, drawdowns, profit factors, and consistency metrics.
- Historical data: For most of the symbols, Optionalpha can provide you with pricing and financial data for the last 15 years, starting from 2007. When you consider this much data, algorithmic forecasts become more accurate.
5. Watchlist
Option Alpha lets you maintain a watchlist to follow your stocks and portfolio in real-time. By clicking on the watchlist stocks, you will get a complete pricing history, recent company and industry news, and tons of technical indicators, including buy/sell signals.
6. Community and Networking
Option Alpha offers an excellent opportunity to network with fellow traders and learn from their expertise. The platform has a highly active and informative community, where you will most certainly get a response to any queries related to options trade strategies or ideas.
One of the core strengths of the Optionalpha community is that it allows traders to share their trading templates. You can easily clone someone else’s templates once they share them on the platform.
A few other highly convenient community features are:
- Private messaging
- Group messaging
- Following other traders
- Activity notifications
What are the Option Alpha Strengths?
Whether you are a novice or an experienced options trader, Option Alpha can be a great resource for you. Here are some of the platform’s key strengths:
- Lots of free resources: Option Alpha provides high-quality resources for you to learn trading in great detail for free.
- Strong community: Option Alpha fosters a strong community of fellow traders and learners. Also, the community is open to all three membership levels.
- Zero commission: The platform does not charge any trade or contract commission from you or any other fees for high-frequency trading.
- Great research tools: Option Alpha equips you with two robust research tools – backtesting and a watchlist scanner. You will get an excellent overview and technical analysis of stocks and options you will invest in.
- Zero coding: Although Optionalpha focuses on algorithmic options trading, it does not require you to have any coding knowledge of the program, build and customize the algorithms.
- Quick strategy implementation: The platform lets you assign specific pre-programmed strategies to your automation bots. This comes very handy if you are a beginner because you won’t have to adjust the customizable settings manually.
- Pre-programmed bots: To get started without technical knowledge, you can easily rely on Optionalpha’s pre-programmed bots. You can also customize the bot templates as you want.
Are there any Option Alpha Cons?
Although Optionalpha’s resources and functionalities are quite comprehensive, the platform also has a couple of weaknesses.
- Limited platform integrations: Option Alpha currently allows integration with only three trading platforms. They are in discussion with a few more. However, quite a few popular trading platforms are still not integrated with Optionalpha.
- Limited entry-level package: One of the most valuable Option Alpha features, Backtesting, is not available with the basic package, which may significantly limit your research abilities on the platform.
- No portfolio management: Option Alpha is not a direct portfolio management service. You can take support from its community and resources and use the pre-programmed automation bots.
If you are looking for someone to manage your portfolio on your behalf, Option Alpha may not be the product for you. Even with all the resources, automation, and support, you will have to spend time researching and setting the automation.
What Do Others Say? Option Alpha Reviews at a Glance
We’ve given our thoughts on Option Alpha, but let’s see what other reviewers had to say:
- Trade Options with Me have been positive about Option Alpha, particularly its vast educational resources. They have recommended it as an excellent platform to learn algorithmic options trading.
- Yolo Trading has published a detailed Option Alpha review on their official Medium page. They have expressed some disagreements with the trading strategies recommended by Option Alpha’s community and webinars.
- TrustPilot gives Option Alpha a 3.8 out of 5, which is considered “great” on the platform.
- Top Trade Reviews has also been optimistic about Option Alpha after completing a detailed review. The reviewer has given 4 out of 5 to Option Alpha.
- Trading Skeptic has assigned 3.7 out of 5 to Option Alpha and has been optimistic about the trading platforms. The reviewer praised the depth of learning resources.
Option Alpha Pricing
Option Alpha pricing is quite simple. Here are the pricing structures:
- Starter: $39/month
- Pro: $99/month
- Elite: $199/month
All the prices mentioned above are billed annually. You can also opt for monthly billing at a higher cost. The main differences between the pricing tiers are the number of bots you can use and the capacity of the bots. Also, remember that backtesting is available with Pro and Elite packages only.
Final Evaluation: Should You Buy Option Alpha Subscription?
Option Alpha provides you with some serious algorithmic options trading features. The website also provides an excellent collection of resources for anyone who wants to learn how options trading algorithms work. Most interestingly, all the educational resources are entirely free.
There are plenty of customizations you can do with Optionalpha automated trading bots. Beginners can also take advantage of the template bots and strategy exchange features.
So, should you buy the Option Alpha subscription? Well, the platform offers a free 30-day trial with no credit card required. This gives you an excellent chance to explore the website closely without committing. Sign up for your Option Alpha trial today.
Option Alpha is a solid platform that offers robust algorithmic options trading automation tools and plenty of educational resources to learn options trading. The platform does not charge commissions and currently offers a free 30-day trial. The educational resources they offer for free are simply mind-blowing. If you want to learn options trading or go ahead with automated trading, the Option Alpha trial is well worth your time. User Rating
Nick Saraev is a technology writer with a particular interest in macroeconomics and entrepreneurship. He's been featured in publications like Popular Mechanics and Apple News.
