Historically, brokers charged both a commission and a per-contract fee on option trades. Now, most brokers do not charge a commission, but they still charge a fee per contract. Fidelity and Schwab charge $0.65, and Vanguard charges $1.00 per contract. Some brokers, such as Robinhood, charge neither a commission nor a fee per contract. But which broker offers the best option prices?
In late 2025 and early 2026, Fidelity introduced a specific promotion for their new Fidelity Trader+ platform, waiving the $0.65 contract fee for up to 100,000 contracts over a 6-month period for users who opted into the new Trader+ platform. I don't know if Fidelity will eventually make this program permanent, but for now, it was a temporary promotion. Nonetheless, some brokers, such as Robinhood, do not charge a contract fee for option trades. Unfortunately, the option prices on Robinhood seem much worse than the other brokers discussed in this article.
On March 6, 2026, I had GTC limit orders on 4 different brokerage accounts, set at the same prices the day before, to sell puts on EDV. On Friday, March 6, EDV dropped in price at market open, so all my limit orders on EDV puts executed at the opening of the market at the following prices:
Fidelity
Robinhood
Schwab
Vanguard
I consistently find that Robinhood has the worst prices for options. While they do offer virtually free trading of options, Robinhood also has the worst prices, which usually more than offsets the savings on commissions and fees, often substantially so.
As you can see from my sales of puts at the market open, I got the lowest price of $65 at Robinhood Compared to $70 at Vanguard and Fidelity, and $75 and $85 at Charles Schwab.
Schwab has an additional benefit in that it allows option price increments in pennies on many more securities than offered by the other brokers. EDV is a good example: I can change the price by a penny instead of being forced to change it by $0.05. However, prices only show up in the national market at $0.05 intervals, but I often get executions, usually better executions, at sub-nickel intervals. So, why different increments for different securities and price ranges? I guess so that market makers can make more money by keeping the spread wider apart. This is why, not too long ago, stock prices were expressed in fractions instead of the dollar and cents used for actual purchases.
These are some of the interval rules for option pricing.
The Penny Interval Program (aka Penny Program) is a standard industry-wide rule that allows certain high-volume options to be quoted and traded in $0.01 increments instead of the standard $0.05 or $0.10.
1. The Standard Pricing Rules
In 2026, most options follow a 2-tier pricing system based on the option premium:
2. The "True Penny" Exceptions
Some ultra-liquid ETFs are exceptions to all rules. These trade in $0.01 increments at all price levels, even if the premium is $50.00 or more:
The list is updated periodically by the exchanges to include only the 300 most actively traded options where the underlying security is less than $200.
Note, however, that even options that are not in the penny program can trade at any price if the broker found a price improvement or if the option trade is a leg in a more complex trade, such as a vertical spread.
When trading options at the bid for sales or the ask price for purchases, I usually get a price improvement at Fidelity, Schwab, and Vanguard. Often the price improvements are substantial. Not so much at Robinhood. I rarely get a price improvement at Robinhood, and when I do, the improvement is small.
This is why I decided to stop trading options on Robinhood. Of course, this may change in the future, but, for now, I will use the other brokers for option trades.