How does option trading work?

Option trading involves buying and selling options contracts, which are financial instruments that give you the right, but not the obligation, to buy or sell an underlying asset, like stocks, at a predetermined price within a specific time frame.

Is option trading good for beginners?

Options trading can be complex and carries inherent risks, so it may not be suitable for all beginners. However, with education, beginners can learn options basics, risks and advantages, and simple option strategies to trade options effectively.

Is option trading better than stocks?

Both options and stock trading have unique pros and cons. The 'better' choice hinges on personal financial objectives, risk appetite, and market expertise. Neither universally outperforms the other; rather, their suitability varies by investor.

Is there an app to practice options trading?

Yes, moomoo is a popular options trading platform in Canada, providing investors with a powerful paper trading tool to help you prepare for the transition to live trading.

Options Trading with Low Cost Contracts

Low costs for trading US options

Take charge of your investments with our low fees and margin rates.

		Wealthsimple	Questrade
Transaction fees	$0.65/contract, min.$1/order	$0	$0.99/contract
Excercise/ assignment fee	$0	Early exercise: $45 Auto-exercise: $20	$24.95
Margin rate (Assets under $100K)	7%	7.5%	11.5%
Currency exchange fees	$0	1.50%	1.50%

See Pricing

Disclosure

Why moomoo for options trading

More investment opportunities

Empower your options trading with 13 options strategies for bullish, bearish, and neutral markets.

Buy or sell a single call or put option. It's a simple, low-cost way to profit from market moves or hedge your risk.

Powerful insights and option tools

Make options a part of your investment strategy with these advanced tools.

Unusual Options Activity

Detect significant market changes and gain insights into high volume options trades.

Active 0DTE Options

Identify the most traded options and adjust your strategy to stay ahead.

Insightful P/L Analysis

Visualize the potential profit and loss of your options strategy at expiration.

Options Earning Analysis

Analyze the past 12 earnings dates and expected moves for upcoming earnings calls.

Benefits of trading options

Start small, invest big

Trade your favorite stocks for a lower cost and more potential returns.

Defensive strategies

Hedge your investments using protective options strategies.

More flexibility

Trade the market with bullish, bearish, or neutral strategies.

Start Trading Options

Financial services in the moomoo app are provided by Moomoo Financial Canada Inc. You will be redirected to Moomoo Financial Canada Inc's web domain, where the account application pages are hosted.

Today's options market and latest news

Options Market Trends

Open an account to unlock unlimited data

Unlock Now

Financial services in the moomoo app are provided by Moomoo Financial Canada Inc. You will be redirected to Moomoo Financial Canada Inc's web domain, where the account application pages are hosted.

New to options trading?

Level up your options trading skills with moomoo.

Options Bootcamp

Try Now >

Financial services in the moomoo app are provided by Moomoo Financial Canada Inc. You will be redirected to Moomoo Financial Canada Inc's web domain, where the account application pages are hosted.

Trading Courses

Learn More >

Paper Trade

Practice Now >

24/7 Support

Options Trading Course

Access moomoo's free online options trading courses anytime, anywhere.

How to start trading options

Follow these simple, easy steps to get started with options trading.

Open an account

Deposit

Deposit funds or transfer assets to your account.

Trading Options

Activate your options trading permissions and make your first options trade.

Start trading options

Financial services in the moomoo app are provided by Moomoo Financial Inc. You will be redirected to Moomoo Financial Inc's web domain, where the account application pages are hosted.

Build a smart options
portfolio

Margin

USD margin rates for options start at 6.4% (as of November 3, 2025).

Cash

Your idle cash generates rebates in option investments.

TFSA

Trade options with potential tax-free returns within your TFSA limit.

RRSP

Grow your savings more efficiently with deferred taxes.

Open an Account

Financial services in the moomoo app are provided by Moomoo Financial Canada Inc. You will be redirected to Moomoo Financial Canada Inc's web domain, where the account application pages are hosted.

FAQs

What is options trading and how does it work?

An option gives the buyer or holder the right, but not the obligation, to buy or sell an underlying asset or security at a specific price on or before a specific date. You can think of options as a way to "reserve" the ability to make a trade in the future. Learn more about what are options >

What are call and put options?

A call option gives the holder the right, but not the obligation, to buy an underlying asset at a specified price, known as the "strike price," before the option expires. In contrast to a call option, a put option gives the holder the right, but not the obligation, to sell an underlying asset at a specified strike price before the option's expiration. Learn more about put and call options >

Is options trading suitable for beginners?

Options trading may not be suitable for all beginners because of its complex and carries inherent risks. However, with education resources, beginners can learn simple option strategies, how to manage risk, and trade options effectively.

What are the benefits and risks of trading options?

Benefits:
- Enhanced flexibility for bullish, bearish and neutral markets
- Potential for high returns and a low entry cost to invest
- Effective risk management and portfolio hedging tools
Risks:
- Potential for significant losses due to leverage
- Time sensitivity and expiration of contracts
- Complexity requiring advanced knowledge and skills

How do I trade options on moomoo?

Step 1. Create an options trading account
Step 2. Activate your options trading permissions
Step 3. Select your options
Step 4. Analyze a strike price
Step 5. Choose an expiration date
Step 6. Monitor your position in options trading
Learn more about a complete guide to trading options on moomoo >

What are the fees for trading options on moomoo?

Moomoo offers one of the lowest options trading commissions in Canada:
Commission: $0.65 per contract, with a minimum of $1 per order.
Exercise fee: $0 (Questrade charges $24.95, Wealthsimple charges up to $45).

Which account types can I use for options trading?

You can trade US options with the Margin account, Cash account, TFSA account (Tax-Free Savings Account), and RRSP account (Registered Retirement Savings Plan) on moomoo.

Does moomoo provide real-time quotes and volatility modeling tools?

Yes, moomoo provides free real-time quotes and powerful volatility analysis tools. It supports implied volatility analysis, volatility term structure and volatility smile. You can also use the Options Unusual Activity feature to monitor the moves of large institutions and potentially identify possible new investment opportunities.

Is moomoo regulated in Canada?

Yes, moomoo is a legitimate trading platform in Canada. Its brokerage products and related services are provided by Moomoo Financial Canada Inc., which is regulated by the Canadian Investment Regulatory Organization (CIRO). It is also a member of the Canadian Investor Protection Fund (CIPF), providing a secure trading platform for investors.

$0 Currency Exchange Fees Options Trading Platform

Low costs for trading US options

Why moomoo for options trading

More investment opportunities

Powerful insights and option tools

Unusual Options Activity

Active 0DTE Options

Insightful P/L Analysis

Options Earning Analysis

Benefits of trading options

Today's options market and latest news

Options Market Trends

New to options trading?

Options Trading Course

How to start trading options

Build a smart options portfolio

FAQs

Build a smart options
portfolio