Tastyworks Review 2024

Show Details

tastyworks is a US-based online brokerage specialising in options, futures, and stock trading. An entity of tastytrade, the broker has proved popular with investors globally. But are there better alternatives for UK traders? This review covers platform features, minimum deposit requirements, payment methods, demo accounts, leverage and mobile apps. Find out whether to open a tastyworks trading account.

Key Takeaways

• tastyworks is not regulated by the FCA
• The broker’s trading platforms and tools are not beginner-friendly
• There is a limited selection of deposit methods with high fees for non-US traders
• As an alternative to options trading offered by brokers like tastyworks, which is known to be much harder to learn, our experts recommend looking into CFD trading and the regulated CFD brokers available to UK traders.

Company Details

tastyworks is a relatively new brokerage, founded in 2017. It is a wholly-owned subsidiary of tastytrade. The broker is licensed to operate on a global scale out of the US, with headquarters located in Chicago, Illinois.

The firm is regulated by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA) and the National Futures Association (NFA). The company does not hold a license with the UK’s FCA.

tastyworks utilises advanced technology to provide a competitive trading environment. The company was built from the ground up by a team with decades of experience in the financial industry, including the experts that developed TD Ameritrade’s Thinkorswim platform.

Trading Platform

tastyworks offers a proprietary trading platform. The software is accessible via download directly from the firm’s website or can be used as a web-trader through an internet browser.

We would recommend investing some time to learn the key features of the terminal because it is not intuitive for beginners. The number of functions and icons can make the platform feel quite complex. There are several customisable features, including watchlists, stock screeners and trade asset details including theta, delta and volume. The broker has essentially designed the platform with a ‘See It, Click It, Trade It’ design, so that positions can be executed quickly.

Below we outline some of the key features our experts found:

• Follow Feed – A copy trading style tool that allows users to ‘follow’ selected investors. Watch what trades are being executed in real-time and apply them to your trading strategy
• Curve Analysis – A visual tool to intuitively set up trades for entry. Designed with a click & drag interface plus clear profit and loss areas, users can adjust strikes and expirations easily
• Trading Inspiration – A dedicated tastyworks feed with fresh insights to indicate market movers. An integrated live video stream allows peer reviews of investors tackling market conditions in real-time
• Quick Roll – Simply roll an option position to the next expiration cycle with a quick right-click. Moves can be set to the next weekly or monthly expiration cycle for proficient investing
• Order Adjustments – Modify working orders with a right-click. Terminate, substitute, duplicate, or even overturn working orders that haven’t been filled. Once filled, you can double down on trades
• Data – Utilise 100+ technical indicators such as Open Interest, test interactive charting tools and view real-time price quotes

You can also find integrated tastyworks YouTube video content and step-by-step tutorial guides on the broker’s website. Understand how to use your buying power to the best of your abilities before opening a position. In addition, a guide for all icons and symbols on the tastyworks platform can be downloaded.

Order Types

Supported orders include trailing stop, stop loss, good til cancelled (GTC), good til date (GTD), OCO and OTO conditional bracket orders, among others.

Specifically for options trading, investors can choose between two views; the standard option chain ‘Table’, and a unique visual trading interface, named ‘Curve’. Within these views, predefined strategies can be implemented. These are relatively simple to use and can be opened in just two clicks.

Products & Markets

tastyworks offers trading across eight global asset classes:

Options

Trade options on stocks, ETFs and broad-based indices. You can select options products based on your investment objectives, financial position and risk tolerance.

Futures

The broker’s futures product range has been curated to include some of the most liquid futures and futures options, which can help reduce entry and exit slippage. The offering includes standard futures contracts, small exchange futures (SMFE) and micro futures.

Investors can gain exposure to forex, interest rates, indices and commodities through futures contracts. These include Micro British Pound futures (/M6B), gold futures (/GC) and CBOE Volatility Index futures (/VX).

Options On Futures

Futures options are a unique contract offered by tastyworks. UK investors can buy or sell a futures contract at a specific price by a set date. You can trade a range of futures options contracts across several asset classes including currencies, commodities and interest rates.

Investors are also permitted to utilise mini, micro, and small futures options, meaning you can trade on a budget.

Stocks

Speculate on 8,000+ stocks and shares across global markets. Trade and invest in individual company shares or gain diversified exposure through ETFs.

Cryptocurrency

tastyworks clients can establish cryptocurrency positions across 25+ digital currency coins including Bitcoin, Stellar, Shiba Inu and Dogecoin.

Indices

Trade on some of the world’s largest stock indices including the FTSE 100, S&P 500 and Russell 2000. Traders can utilise various products within a portfolio. This includes index options, futures and ETFs.

Commodities

Invest in a variety of commodity markets using options, futures, ETFs, stocks and futures options. Balance your portfolio with products that work for your investment goals.

Energy commodities available include crude oil and natural gas. Non-energy commodities include agricultural assets such as corn, wheat, and soybeans, plus precious metals like gold and silver.

ETFs

Use ETFs to gain exposure to US and international markets by trading exchange-traded funds or ETF options. You can speculate on both rising and falling ETF market prices.

Available assets include index ETFs, commodity ETFs and bond ETFs. Some of the most common investments include the SPDR S&P 500 ETF Trust (SPY) and the SPDR Dow Jones Industrial Average ETF Trust (DIA).

But while a relatively decent selection of instruments, alternatives like Interactive Brokers and IG also offer a good range of derivatives spanning many of the vehicles above, plus more user-friendly tools and account conditions for UK investors.

Pricing & Fees

While using tastyworks, our experts were pleased to see no account opening charges, management costs or inactivity fees. You can find a full breakdown of commissions and fees on the broker’s website. Below we review some of the key financial charges:

Commissions

• Stock Options – £1 per contract to open. No charge to close a position. All stock options trades incur a clearing fee of $0.10 per contract
• Futures – £1.25 per contract to open and close a position. All futures trades incur a clearing fee of $0.30 per contract + exchange fees + NFA Fee
• Cryptocurrency – 1% of total crypto purchase to open and close a position. Cryptocurrency commission fees are capped at $10 per order ticket
• Stocks And Shares – Zero commission to open or close a position. All stock trades incur a clearing fee of $0.0008 per share. All fractional shares incur a clearing fee of $0.10 per transaction

Margin & Leverage

tastyworks margin rates are volume-tiered. This constitutes a base rate, and a premium or discount depending on the margin amount. For example, at the time of writing, the margin interest on a £10,000 account balance was set at 8%.

Note, that a minimum account balance of $2,000 or more must be complied with to unlock margin trading opportunities.

Overnight positions also may be subject to rollover interest. This is only applicable to cash instruments. It does not impact futures positions. The amount charged depends on the position taken, for example, short or long.

UK Taxes

There are no set tax amounts for retail investing, so payments for tax purposes will depend on the instrument you trade, your profit or loss, plus the type of trading activity and your tax number. For example, you may be required to pay capital gains tax (CGT) on shares you own if you sell them for a profit. This may also apply to any profits made from company dividends.

The amount of tax you are required to pay will also depend on which income tax band you fall into. As a UK taxpayer, you may pay up to 20% CGT.

As always, your specific tax liability will depend on your individual circumstances so seek advice from a registered professional.

Mobile App

The tastyworks platform is available as a mobile app. It is available for download to both Apple and Android devices from the relevant app stores. The mobile application offers sufficient functionality for trading, including setting up new trades, position management and viewing interactive charting. Most traders prefer to use a mixture of web-based and downloadable mobile applications, so spend some time working out what works best for you.

The tastyworks proprietary mobile app is similar to the broker’s web platform, with a user-friendly design created for accessibility on smaller screens and portable devices. The design is modern although search functions are basic, lacking asset filters. Another major drawback is that you cannot set price alerts through the app. Keep an eye out for the latest release notes or app update announcements as this feature may be added soon.

Nevertheless, reviews on the Apple app store are mostly positive, rated 4.8 out of 5 from 80+ appraisals.

Payment Methods

Deposits

There are no minimum deposit requirements to register for a new account. tastyworks does not apply a deposit fee for any funding methods. UK investors are only permitted to fund an account with international bank wire transfers or brokerage to brokerage account transfers (ACAT). This is a significant drawback vs competitors such as IG.

An ABA routing number, recipient name (tastyworks via Apex Clearing) and beneficiary account number are provided for GBP payments. Allow up to five working days for funds to be available in your trading account. ACH or cheque payments are only permitted from US bank accounts. Note, that credit/debit cards are not accepted.

Deposits can be made via the client zone. Simply select your chosen finance method via the deposit section within your profile interface. Exchange rates may apply if you are depositing in a currency other than GBP (your account base currency).

Withdrawals

As with tastyworks deposits, withdrawal methods are limited to bank wire transfers only for UK investors. It can take up to three working days for funds to clear. Weekend dates and public holidays may cause time delays due to bank closures.

Being a UK trader is not particularly advantageous when it comes to fund withdrawals. A £45 fee applies for all outgoing foreign bank wire transfers.

Demo Account

When we used tastyworks, it was disappointing to see that the broker does not offer a demo account. Paper trading accounts are a great way to practice strategies risk-free and learn platform features and tools. These profiles are particularly useful for inexperienced investors or those wanting to trial trading in a new asset class.

Interestingly, tastyworks parent entity, tastytrade, offers one of the best tools in the market for simulated strategy software. Clients can use the lookback and backtesting tools to implement an options strategy for free in a practice environment. So the lack of a UK paper trading account is a significant downfall when comparing tastyworks vs established brokers like Interactive Brokers and IG.

Regulation & Licensing

tastyworks is not regulated in the UK. Instead, the broker is authorised by other international financial hubs. The overarching licensing comes from the US Securities and Exchange Commission (SEC). The company is also self-regulated by the Financial Industry Regulatory Authority (FINRA) and the National Futures Association (NFA).

The FINRA is a non-governmental organisation yet implements stringent regulations to protect investors and ensure the financial markets function honestly. The NFA body is a gateway all securities firms must pass to conduct business in the US.

UK traders will fall under the tastyworks Inc legal entity. With this comes eligibility for the US investor protection scheme where retail clients are protected against the loss of cash or securities in the case of business insolvency or disputes. The SIPC protection limit is £500,000.

So whilst UK traders may be disappointed by the lack of FCA oversight, the broker still holds respected regulatory licenses. This indicates that the company is genuine and trustworthy.

Additional Features

Education

tastyworks provides a fairly decent range of educational materials. The majority of information is hosted through tastytrade’s educational platform. This includes live news streams, real-time trading shows during weekday trading hours and online courses sorted by category.

The learning centre is supported by various tools including online quizzes, a keyword glossary, embedded videos and an online journal. Topics include a beginner options trading tutorial, account liquidity needs and a deep dive into implied volatility.

Resources

Similar to the education source, tastyworks clients have access to tastytrade’s resources and tools segment. UK investors can access the latest market insights, an options backtesting strategy feature and applicable information on trading concepts and strategies including the Poor Man Covered Call.

Additionally, new users can receive a free copy of The Unlucky Investors Guide to Options Trading book when you open and fund a new tastyworks account.

Deals & Promotions

• Bonus – tastyworks regularly endorses promotions and financial incentives. Previous deals have included a £250 new account sign-up bonus.
• Referral Programme – tastyworks offers a referral programme. Credits can be received for every qualified referral registered by a unique code. These can be banked for a cash deposit to a live account or redeemed for luxury items.

Importantly, review the terms and conditions of bonuses and promotions before signing up, as unrealistic minimum thresholds and withdrawal requirements may apply. Also check these offers are available to UK investors as country-specific restrictions may be in place.

Account Types

tastyworks offers several account types to retail investors in the UK. The most relevant for non-US residents is the international account with the option of cash or margin trading. Additionally, you can find joint trading accounts, retirement accounts and trust accounts, with custodial profiles due to launch soon.

Note, that not all profiles are available to UK traders. Contact the customer service team to understand available profiles before registering.

In this review, we outline the most commonly used account, referred to as ‘The Works’. The profile is an individual margin account. It provides access to all investment products, using any options trading strategy and has the opportunity for a Portfolio Margin manager based on eligibility (maintenance minimum of £150,000).

Upon testing, we were pleased to see that tastyworks has no minimum deposit requirement. It is worth noting, however, that you will need at least £2,000 to qualify for margin privileges.

Opening An Account

To open an account, visit the ‘Open An Account’ link at the top right of each web page. Complete the application form and provide the relevant ID verification documents, such as a passport. KYC and AML compliance is followed here.

An application should take between three to five minutes to complete, although it can take up to three working days to be processed.

Benefits

• Low trading fees
• Various account types
• Proprietary mobile app
• Strong security features
• Several customer support options
• No minimum deposit requirements
• Multiple asset classes including 8,000+ stocks
• Comprehensive educational content and resources

Drawbacks

• No FCA regulation
• High withdrawal fees
• No demo account option
• Margin privileges require a minimum maintenance value

Opening Hours

tastyworks trading hours vary by instrument. Typically, the forex market is available to trade 24 hours per day between Sunday to Friday. Crypto, on the other hand, can be traded 24 hours per day, 365 days a year.

Note, that the times listed on the broker’s website are in Central Standard Time (Chicago time). Server time has a GMT offset of GMT -6 or GMT -5 when daylight savings are in effect.

It is worth viewing the published session timetable available on the broker’s website. This is particularly useful for staying up to date with upcoming public holidays, extended or after-hours trading times, and market closures.

Customer Support

tastyworks offers several customer support options. These include a toll-free phone number, live chat services and a headquarters mailing address. While using the brokerage, our traders noted a reasonably responsive service, with prompt and appropriate answers received within minutes via the live chat function.

It was disappointing to see no email contact option. Nonetheless, a useful self-help FAQ section can be found on the broker’s website. Topics include how to close a position, why a margin check failed, future margin requirements, how to exercise an option position and understanding net liquidity.

• Fax – Number 312-724-7364
• Live Chat – The logo can be located on the bottom right side of all webpages
• HQ Mailing Address – 1000 W.Fulton Market, Suite 220, Chicago, IL, 60607
• Telephone Number – Toll-free number 888-247-1963 available 7 AM to 5 PM (GMT-6)
• Social Media – Connect with the broker across channels including Twitter, LinkedIn and Facebook

The major downside is that telephone support is only available on weekdays from 7 AM to 5 PM (GMT-6). Bear this in mind if you have an urgent tastyworks query.

Live chat services, however, should be able to provide quick responses to queries about your account or technical difficulties. Topics can include why a page keeps crashing, significantly delayed quotes or slow execution speeds.

Security

UK traders should feel assured that tastyworks provides a secure investing environment. The broker quotes several defensive system configurations, security devices, and real-time monitoring systems to protect access and privacy surrounding live accounts.

All data is fully encrypted (256 bit or higher) at rest and in transit. The server connection is signed with SSL Certificates. Two-factor authentication (2FA) is required for the majority of functions. This includes when changing a registered email address, login attempts on a new device, or movement of funds. To use this security feature, you will need to download an authenticator app such as the Google Authenticator app or Microsoft Authenticator.

You are also permitted to log in using biometric authentication such as face recognition, QR code or fingerprint registration. A trusted contact can be added to an account for additional reassurance.

It is good to note that according to the Identity Research Theft Center, there have been no major security breaches reported in the last 4 years for the broker.

Tastyworks Verdict

tastyworks is an upcoming brokerage offering multi-asset trading opportunities. Our experts were pleased with the low trading fees and responsive customer support team.

The major drawbacks for UK traders are the lack of FCA oversight, no demo account service or negative balance protection. In addition, there are few deposit options, high withdrawal fees, and trading tools that aren’t suitable for beginners. With this in mind, our experts recommend trading with Interactive Brokers or IG.

FAQ

Top 3 Tastyworks Alternatives

These brokers are the most similar to Tastyworks:

1. Interactive Brokers - Interactive Brokers (IBKR) is a premier brokerage, providing access to 150 markets in 33 countries, along with a suite of comprehensive investment services. With over 40 years of experience, this Nasdaq-listed firm adheres to stringent regulations by the SEC, FCA, CIRO, and SFC, amongst others, and is one of the most trusted brokers for trading around the globe.
2. IG Index - Founded in 1974, IG is part of IG Group Holdings Plc, a publicly traded (LSE: IGG) brokerage. The brand offers spread betting, CFD and forex trading across an almost unrivalled selection of 17,000+ markets, with a range of user-friendly platforms and investing apps. For 50 years, IG has maintained its position as an industry leader, excelling in all key areas for traders.
3. Swissquote - Swissquote is a Switzerland-based bank and broker that offers online trading and investing. The company has a high safety score and is listed on the Swiss stock exchange. The firm offers a huge range of products, from stocks, ETFs, bonds and futures to 400+ forex and CFD assets. Hundreds of thousands of traders have opened an account with the multi-regulated brokerage. Clients can get started in three easy steps while 24/7 customer support is available to assist new users.

Tastyworks Feature Comparison

Trading Instruments Comparison

Tastyworks vs Other Brokers

Compare Tastyworks with any other broker by selecting the other broker below.