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Free Option Trading Software

I'm guessing that the reason why anyone would be looking for free option trading software, is because they're planning on executing some complex option trading strategies and need a good profit and risk analysis tool to enable them to make more informed decisions.

Complex options positions would be things like strangles and straddles, iron condors, calendar spreads and diagonal spreads - in fact, any "spread" type strategy which involves a combination of options positions. The advantage of having some good free option trading software is, that by either inputting or downloading the relevant data, you can quickly analyze:

  1. Whether a strategy is "worth it" in the first place.
  2. After you've done it, how the profitability is looking now.
  3. If I adjust some positions, what will my profit/risk graph look like then?

So we've done some research for you and below, you'll find a summary of some of the best free option trading software available.

We should start by mentioning that if you're trading in the United States, there are two online brokers whose trading platform comes with dynamic risk graph analysis software, together with the ability to back-test strategies on historical data. One is ThinkorSwim by TD Ameritrade, and the other is Tastytrade and its subsidiary, Tastyworks.

They are, in my opinion, far ahead of the rest of the pack as far as options trading software goes. The bad news is, that ThinkorSwim doesn't accept accounts from residents of a number of foreign countries anymore, including Australia and the UK.

The US stock market is the most liquid in the world and their brokerage rates are much cheaper than other countries. So if you're intending on trading US stock options from outside the USA using more complex strategies then you'll be needing some alternative free option trading software to help you.

These free tools will be very useful to any who have purchased and intend using the advanced strategies outlined in the very popular Trading Pro System - an options educational course that teaches you how to "manage your portfolio by the numbers" - meaning, "the greeks" - but can't get access to the ThinkorSwim platform that it recommends.

Top Free Option Trading Software Picks

1. Options Oracle   -

In contrast to the above, this is standalone software which also allows you to download options information in real time. It's an interactive tool which has a user friendly interface that will both analyze and graphically represent your positions. It also contains a "screener" Wizard which lets you locate and test pre-configured strategies over multiple stocks and options.

You can also compare historical and implied volatility for any options you're considering purchasing, for any given timeframe. Options Oracle also includes a "greeks" calculator, making it ideal for anyone outside the USA who uses the Options Trading Pro System.

It can also manage multiple portfolios and navigate between saved strategies.

2. Option Star  -

This is another Excel based application which can analyze specific spread strategies such as covered calls and other custom spreads. Based on the data you input, the program will provide volatility information, the greeks and a highlighted estimate of whether the options are overpriced or not.

Option Star will also give you a risk analysis and profit graph of any positions you choose.

My Choice of Free Option Trading Software

Based on the above summaries - and assuming you can't get access to the ThinkorSwim trading platform - my preference would be to test run Options Oracle. It seems to carry the most comprehensive and flexible basket of features.

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