Both Interactive Brokers and E*TRADE charge $0.65 per options contract, so the fee line on your statement looks the same either way. The decision that actually matters is what each platform lets you do with that contract: IBKR gives you access to more than 150 markets and a path to lower costs as your volume grows, while E*TRADE (now part of Morgan Stanley) keeps everything US-focused and backs it with research most global platforms don’t bother building.
Key Takeaways
- Options pricing is identical on the surface: $0.65/contract at both brokers, no base stock commission at either.
- IBKR Pro’s tiered pricing can drop as low as $0.15/contract at very high monthly volume; E*TRADE has no volume discount on options.
- IBKR supports futures and futures options; E*TRADE does not offer either, at all.
- Only IBKR offers fractional shares, relevant if you get assigned stock and want to manage an odd lot.
- Both platforms offer paper trading, so neither is a meaningfully easier place to practice multi-leg orders risk-free.
- E*TRADE’s trading is confined to US markets; IBKR connects to over 150 markets in 36 countries.
The cost comparison nobody needs a calculator for
As of this writing, IBKR Lite charges a flat $0.65 per options contract on your first 1,000 contracts a month (then reverts to IBKR Pro’s tiered schedule below), with $0 commission on US stock trades and no account minimum. E*TRADE charges the same $0.65 per contract, also with $0 stock commission and no minimum. For most retail traders placing a handful of contracts a week, there is no dollar difference between these two brokers on options cost (data verified against brokers.json, last verified 2026-10-03 for IBKR and 2026-10-09 for E*TRADE).
E*TRADE does offer one wrinkle IBKR Lite doesn’t: a $0.50-per-contract active-trader rate for accounts placing 30 or more stock, ETF, or options trades in a quarter. If you clear that bar, E*TRADE’s per-contract cost actually undercuts IBKR Lite’s flat $0.65.
Where the two diverge is at serious volume. IBKR Pro runs a premium-based tiered schedule: roughly $0.25 to $0.65 per contract depending on the option’s premium at up to 10,000 contracts a month, falling to $0.50 flat from 10,001 to 50,000 contracts, $0.25 from 50,001 to 100,000, and $0.15 per contract above 100,001 contracts a month (a $1.00 minimum per order applies on both IBKR Lite and Pro). E*TRADE has nothing comparable. A trader doing 500+ contracts a month will pay noticeably less on IBKR Pro than on E*TRADE’s flat $0.65 (or even its $0.50 active-trader rate); a trader doing a dozen contracts a month will not notice the difference either way.
Comparison table
| Feature | Interactive Brokers | E*TRADE |
|---|---|---|
| Options cost | $0.65/contract (Lite, flat); Pro tiered down to $0.15/contract at volume | $0.65/contract standard; $0.50/contract active-trader rate (30+ trades/quarter) |
| Stock commission | $0 | $0 |
| Account minimum | $0 | $0 |
| Futures & futures options | Yes | No |
| Fractional shares | Yes | No |
| Paper trading | Yes | Yes |
| Market access | 150+ markets, 36 countries | US markets only |
| Platform | Trader Workstation (TWS), IBKR Pro/Lite, mobile | E*TRADE Web, Power E*TRADE |
| Affiliate program | Introduce a Broker (IaB) | None public |
Where IBKR actually separates itself: breadth, not just price
Interactive Brokers connects to more than 150 markets across 36 countries, so if you want to trade options on a foreign-listed underlying, or just want the flexibility to in the future, IBKR is the only one of these two that can do it. It also supports futures and futures options outright, something E*TRADE does not offer in any form. If your options strategy ever extends into commodity or index futures (hedging a portfolio with /ES futures options, for example), that’s a hard line E*TRADE can’t cross and IBKR can.
IBKR also offers fractional shares. For an options trader, this matters most after assignment: if you’re short a put that gets exercised and you end up with an odd lot of stock relative to your position sizing, IBKR lets you trade that fractional position directly. E*TRADE does not support fractional shares, so you’re stuck holding (or selling) in whole-share increments.
The IBKR Lite vs. Pro distinction is also worth understanding before you open an account. Lite is the simpler, flat-fee tier aimed at retail traders who don’t need the lowest possible per-contract cost. Pro’s tiered structure rewards higher monthly volume with materially lower per-contract pricing, but it requires actively choosing Pro over Lite at account setup (or switching later). If you’re a premium seller running dozens of contracts a week, it’s worth doing that math before you default into Lite.
Where E*TRADE holds its ground: research and a simpler mental model
E*TRADE’s acquisition by Morgan Stanley means it carries research depth that IBKR, built around execution and global access, doesn’t natively replicate. If part of your options process involves reading analyst research or wealth-management-style portfolio context before placing a trade, E*TRADE’s Power E*TRADE platform bundles that in a way IBKR’s Trader Workstation doesn’t try to.
E*TRADE’s platform structure is also simpler by design: E*TRADE Web for casual use, Power E*TRADE for active traders, both built around US equities and options specifically. IBKR’s Trader Workstation is powerful but has a real learning curve, since it’s built to handle global multi-asset trading, not just US options. A trader who only ever wants to trade US-listed names and never touches a future, a foreign stock, or a fractional share may find E*TRADE’s narrower focus easier to live with day to day.
Both brokers offer paper trading, so this isn’t a factor in choosing between them, despite how often it gets cited as a differentiator in broker comparisons generally. If you’re deciding based on “which one lets me practice risk-free first,” the answer is both do.
A hypothetical way to think about it
Say a trader is running a defined-risk iron condor strategy on SPY, placing roughly 20 contracts a month across entries and exits, and has no interest in futures, foreign markets, or fractional shares. In this illustrative scenario, the cost difference between IBKR Lite and E*TRADE is effectively zero ($0.65/contract either way, before E*TRADE’s active-trader rate kicks in at 30+ trades/quarter), so the decision would come down to platform preference: Power E*TRADE’s simpler structure and Morgan Stanley research access, versus Trader Workstation’s deeper order types and future-proofing for strategies that might expand later. This is a hypothetical illustration only, not a recommendation to use either platform for any specific strategy.
Now say a different, more active trader is placing 150+ options contracts a month and occasionally wants to hedge an equity options book with index futures options. In that illustrative case, IBKR’s Pro tier pricing and futures access would be the more natural fit purely on structural grounds, since E*TRADE has no equivalent at any price. Again, this is an illustrative framework for thinking about the decision, not advice to trade at any particular size or in any particular instrument.
Who fits each broker
Interactive Brokers fits: global or multi-asset traders who want the lowest per-contract cost at scale, anyone who wants futures or futures options access, traders who might end up holding fractional shares after assignment, and anyone who values breadth of market access over platform simplicity.
E*TRADE fits: US-focused traders who want research and wealth-management context bundled with execution, traders who prefer a simpler two-tier platform structure (E*TRADE Web vs. Power E*TRADE) without IBKR’s steeper learning curve, and traders who place 30+ trades a quarter and can use the $0.50 active-trader rate without ever needing IBKR Pro’s volume tiers.
Bottom Line
On pure per-contract cost at typical retail volume, these two brokers are a wash at $0.65/contract. The real decision is about what else you need: IBKR for futures, fractional shares, and global market access; E*TRADE for Morgan Stanley research and a simpler, US-only platform. Check each broker’s current terms before opening an account, since pricing tiers and active-trader thresholds can change.
FAQ
Q: Is Interactive Brokers cheaper than E*TRADE for options?
A: Not at typical retail volume. Both charge $0.65 per contract as of this writing. IBKR Pro’s tiered pricing becomes cheaper than E*TRADE above roughly 10,000 contracts a month; E*TRADE’s $0.50 active-trader rate (30+ trades/quarter) can undercut IBKR Lite’s flat $0.65 for traders who don’t hit IBKR’s volume tiers.
Q: Does E*TRADE offer futures options?
A: No. E*TRADE does not support futures or futures options at all. IBKR does.
Q: Can I trade foreign stocks or options on E*TRADE?
A: No, E*TRADE is US-markets only. IBKR connects to more than 150 markets in 36 countries.
Q: Do both brokers offer paper trading?
A: Yes. Both IBKR and E*TRADE offer paper trading accounts, so neither has an advantage here.
Q: Which broker is better for a beginner options trader?
A: E*TRADE’s simpler two-platform structure (E*TRADE Web, Power E*TRADE) generally has a shorter learning curve than IBKR’s Trader Workstation, which is built for global multi-asset trading. A beginner who only plans to trade US options may find E*TRADE more approachable, though IBKR Lite is still a flat, simple fee structure if you want IBKR’s broader toolset from day one.
Still deciding between a global, do-everything platform and a research-backed US-focused one? Interactive Brokers is worth opening alongside an existing account if futures or international access matter to your strategy; otherwise, E*TRADE’s own account page lays out its current options pricing and platform tiers directly.