Both tastyworks and thinkorswim, which begin with a lowercase “t,” are widely used online brokerages that cater primarily to do-it-yourself options traders. The similarities between the two brokerages are not coincidental; they were founded by the same individual, Tom Sosnoff. We use TOS in this article for thinkorswim, sometimes abbreviating tastyworks as tasty.
Tom Sosnoff, co-creator of thinkorswim, established the Dough trading group. He followed his breakthrough with the innovative creation of the brokerage platform tastyworks.
tastytrade, the first live network of active retail options traders, was the impetus for creating tastyworks, a brokerage firm. tastyworks is an innovative brokerage that focuses on serving the needs of individual traders.
tastyworks sees itself as a partner on the unpredictable path to successful trading. It was built with the active trader and the retail market in mind. Compared to the standard brokerage model, the broker’s cutting-edge tools and knowledge set the business apart.
Tastytrade was released in 2017 to introduce young, and Gen X investors to online trading and investment, much like Robinhood does.
Both sites provide free signups with no recurring costs, a significant reward. It is easy to hop on thinkorswim or tastyworks and risk-free play around with their features. Trading always involves some degree of uncertainty. There may be some trial and error involved, but it will be well worth it, in the end, to figure out which platform best suits your needs.
tastyworks Overview
The conventional brokerage sector has been challenged by tastyworks. To compete with upstarts like tastyworks, several long-standing brokerages gradually reduced their commission rates.
tastyworks is phenomenally successful in the futures market and will likely grow its offerings shortly. Since it only opened for business in 2017, it makes sense that futures would be the brokerage’s primary emphasis.
Management has extensive expertise in the financial markets, trading platforms, and other brokerage houses, so critics should think twice before calling the company “too young and inexperienced”.
Overall, a solid broker who offers competitive rates and is an expert in the field of futures trading. If that meets your trading requirements, you do not need anything else. Read the tastyworks or Robinhood review.
thinkorswim Overview
TD Ameritrade, a U.S. brokerage business recently combined with Charles Schwab, operates the trading platform thinkorswim (also known as TOS). Traders and individual investors frequently choose TOS as one of their primary trading platforms. It is often considered the gold standard when delivering professional trading tools. When TD Ameritrade bought thinkorswim in 2010, it paid $606 million. Since then, thinkorswim has acquired TD’s global reputation along with its technology. thinkorswim is a semi-independent broker under TD Ameritrade as of the year 2021.
The creators of thinkorswim also founded a company called tastyworks. As soon as they sold thinkorswim to TD Ameritrade, the group set up tastyworks. To encourage more ordinary people to engage in trading, they generated consistent content and educational resources on options trading. Read the Active Trader Pro vs Thinkorswim review.
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tastyworks vs. thinkorswim Service & Feature Comparison
Costs
tastyworks and thinkorswim each have their own trading and commission costs, and you must understand what they are. Almost all of the 224 possible financial instruments in thinkorswim and 217 in tastyworks. The price you are being offered will factor in the charge the broker takes. For the argument, assume that a financial asset is now trading at 79.6.
You may need to spend $79 just to get in. Since this is the case, tastyworks and thinkorswim will initially result in a negative balance for you. Most frighteningly, you may be charged a fee if you keep a specific financial item overnight or weekend. In general, this holds true for leveraged commodities and stocks. You need to know precisely what you are spending, so before you put money into the market, double-check your costs using tastyworks and thinkorswim.
Pick a broker that does not hit you over the head when you want to cash out. This is especially true if you are on a tight budget and do not plan to make a significant first investment. You should aim for a withdrawal cost of less than one percent of the amount being withdrawn and preferably closer to a flat price of roughly five US dollars. tastyworks and thinkorswim costs may vary depending on where you live. Before making any investments, you should compare the commission and fees offered by tastyworks and thinkorswim. There is an inactivity cost with both tastyworks and thinkorswim.
Compared to thinkorswim’s $6.95 + $0.75/contract rate, tastyworks ‘ free closing transactions and drastically reduced commissions win easily.
Account Types
The most popular account kinds are tastyworks and thinkorswim. Still, there are numerous variations, so it is essential to find the one that best suits your needs.
- Individual and joint
- Traditional individual retirement account (IRA)
- Roth IRA
- A simplified employee pension (SEP) IRA
- Inherited IRA (Roth and traditional)
- Corporate
- Trust
Everyone can find a suitable account at tastyworks. As an added bonus, the broker has developed a novel solution for its active retail traders dubbed “The Works,” which bundles several of its most valuable features. Some of the ways it differs from others are as follows:
- Access to all futures, stocks, options on futures, covered and uncovered options, options spreads
- individual margin account
- The free to use any options trading strategy available
You can also open a standard trading account, either a margin or cash account, in addition to “The Works,” which is the most popular choice among serious traders. The main distinction is that there must be enough money in the cash account to pay for the total purchase price of the deals.
Education and Research
Clients of tastyworks can utilize the investment education platform tastytrade for free because of the broker’s relationship with tastytrade. Market news and on-demand videos are included. In-depth examination of individual securities is challenging on browser and desktop platforms. Volume, days to results, estimated volatility, and 52-week range were some of the information we uncovered.
thinkorswim is a lot more than that. Multiple television channels, a stock and futures screener, a heat map, and backtesting software were among the tools we uncovered (TD Ameritrade and CNBC). More information may be found on the TD Ameritrade website. One example is the availability of free stock information from third-party sources.
Range of Investments
Stocks, ETFs, closed-end funds, options, cryptocurrency, and futures are all available to trade on the tastyworks platform (including options on futures and micro futures). The broker does not provide access to foreign exchange, cryptocurrency, mutual funds, bonds, or OTC stocks.
thinkorswim allows you to trade over-the-counter stocks. Trading foreign exchange, bitcoin futures, exchange-traded funds, and closed-end funds are possible using the program. Trade bonds and mutual funds using TD Ameritrade’s online platform.
In a progressive move, tastyworks facilitates the buying and selling cryptocurrency coins and derivatives like bitcoin futures.
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Trading Technology
There is both a PC client and a mobile app for TOS. They also provide a browser-based option. Trading may be done from any location with just a web browser, and no need to download and install any software. The UI seems dated in comparison to tastyworks.
There is no web browser available. However, several capabilities are only found in professional software. The software’s charting tool has around 400 technical indicators. Extra features include sophisticated commands like OCO and blast all and direct-access routing.
Even though tastyworks’ main platform has many features and options that might be overwhelming initially, it is a great trading platform with a lot of potential. The tastyworks program was created by real options traders.
tastyworks offers a web-based system, a desktop application, and a mobile app as means of trading. Watchlists, position data, and trade page details like delta, theta, and volume are some of the many configurable options available across all three platforms. tastyworks systems are designed with the active options trader in mind. Therefore, many of its features are geared at calculating expected volatility and the likelihood of a profitable transaction.
Options traders might use either a tabular or a graphical approach to the market. Trading tactics like the butterfly, straddle, iron condor, and more are available in both perspectives. Better your trading efficiency by dragging and dropping various option orders and modifying the preset settings. The selected options and their related data (such as the chance of profit, delta, theta, standard deviation, P/L, implied volatility, the predicted move, max profit/loss, expiry dates, prices, etc.) are displayed right under the option chain. With this information, assessing your future options trading prospects is a breeze.
Regarding the trading experience, the user interfaces on both the internet and the desktop platforms are remarkably similar. Both enable trading based on charts, provide access to streaming quotations in real-time, and provide concurrent viewing of quotes on many devices. Because of its superior charting and graphing features, active traders are strongly advised to use the desktop version.
While tastyworks’ software performs an excellent job of maximizing tax efficiency, it does not provide you the option of choosing a tax lot before placing a sell order. To the benefit of traders, who often choose to liquidate their holdings using the FIFO (first-in, first-out) principle, this is a positive development. Traders anticipating greater adaptability in their methods may be let down by the lack of personalization in the tax management’s handling of income. As a whole, the tastyworks platform caters to a specific type of trader because of the specificity of its features, functions, and user interface.
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When it comes to placing orders, stop-limit orders can be placed using any of our supported channels (web, desktop, mobile). One-to-one (OTO) and inverse (Cancels) orders are examples of conditional orders that can only be placed in the desktop app (OCO). The PC is also the only device that supports multi-order entry in a single go. Neither trailing stops nor the ability to queue orders for later entry is supported by any platform.
Mobile Apps
Assume you cannot access your account during regular trading hours because you are away from your computer. This is where tastyworks’ mobile app comes in handy; it has the same core features as the online and desktop versions. This cutting-edge app may be downloaded for both Apple and Google mobile platforms.
Though tastyworks makes it easy to place orders from the go with its drag-and-drop mobile app interface, its charts and graphs are not designed with touch screens. For instance, charts and graphs are only shown in a tiny window, and there are no sketching tools available for use with them. Not much is being said or studied about the smartphone app in the media.
The software may initially seem complicated and clumsy, although the mobile process is straightforward. Investors who intend to trade often should choose a web or desktop platform since it provides more screen real estate and a more satisfying trading experience.
A lot more can be done with the thinkorswim smartphone app. A trade may be executed quickly and easily from a mobile device. In addition to the desktop system’s sophisticated charting and technical investigations, the app also offers these features. The app facilitates trading in various monetary instruments, stock options, and futures. The only hindrance is the mobile device’s smaller display compared to a computer’s.
Other Features
Banking: Because tastyworks does not provide them, you must go through TD Ameritrade if you need help managing your money.
Social: You can simply check what expert traders are trading thanks to a unique feature offered by tastyworks. Both new and seasoned traders might benefit from this.
DRIP service: In terms of dividend reinvestment, both TOS and tasty are good options. Both of them provide IRAs or retirement savings accounts. In contrast to TD Ameritrade, tastyworks does not provide a SIMPLE IRA. TOS users can set up recurring contributions to mutual funds.
Extended-Hours trading: The trading hours on tastyworks and thinkorswim can be extended. The latter has a longer late-night frame, but its early-bird hours conclude before tasty’s. Trading during non-business hours is not only possible with either broker’s software but incurs no additional fees.
Customer Support
Customer service must be a top priority while trading. Even seasoned traders sometimes need guidance from tastyworks or thinkorswim support. This is especially true for inexperienced investors. If you are just starting, you must constantly access resources like tastyworks and thinkorswim. Both tastyworks and thinkorswim provide excellent customer service, not simply for functional reasons. Each has a first-rate chat, phone, and email assistance.
My Preference: tastyworks Wins Over thinkorswim
In sum, tastyworks is a good fit for energetic traders interested in derivatives. Therefore, its foundation is suitable for fast, high-volume options trading. Newer investors may be enticed by the reduced prices compared to competing services. The service’s complex structure is still not simple to navigate. There is minimal guidance for mastering its use. In addition, individual aspects are not highlighted to the same degree.
Let us say you are interested in a broad category of IRAs, mutual funds, or other forms of long-term investment capital. If that is the case, you should keep looking.
Both online brokers have many similarities, and none is exceptionally superior. Both include cutting-edge trading platforms and a vast selection of assets on which to speculate. The high price of doing business with thinkorswim is the sole material distinction.
tastyworks vs. thinkorswim: The Bottom Line
Though it has released a new platform, tastyworks still has a way to go before it can compete with industry giants.
Suppose you are an experienced trader with a keen interest in options. In that case, you cannot go wrong with either thinkorswim or tastyworks. They encourage investment in education through their affiliated portals and facilitate personalization. thinkorswim, on the other hand, extends your access to a wider variety of investment options and market-tracking resources, allowing you to better foresee potential outcomes and make informed trading decisions. However, compared to the competition, the cheap pricing offered by both sites makes them equally appealing to active investors.
However, their social trading does allow you to track the trades of other expert traders and boasts excellent options trading tools. Since there is no cost to start an account at either company or no commission to pay, it makes sense.
FAQ
Are tastyworks or thinkorswim suitable for beginners?
Both tastyworks and thinkorswim need only a little initial investment to gain entry to a wealth of market research and news articles. tastyworks and thinkorswim both provide free trial versions of their services. Demonstrating such concern for their clientele is a significant win for tastyworks and thinkorswim.
Is tastyworks better than thinkorswim?
thinkorswim, supported by TD Ameritrade, surpassed tastyworks in most metrics. However, the latter firm is a superb bargain, particularly for trading options and futures.
Is tastyworks suitable for individual retirement accounts (IRA)?
A dividend reinvestment option is provided by both TD Ameritrade and tasty. In addition, both of them offer IRAs or retirement savings accounts. However, TD Ameritrade does provide a SIMPLE IRA, but tastyworks does not. Customers of TD Ameritrade can set up automated mutual fund purchases. The lack of mutual funds was clearly seen on tasty.