Options Trading

Leverage a security's price movement for potential profit.


What is Options trading?

Options trading is the purchase or sale of a contract of an underlying security. Investors can trade options to potentially benefit in any market condition.

But what are options? An option is a contract between two parties that gives the holder the right, without the obligation, to buy or sell a security during a designated time period at a specified price. Option writer has the obligation to fulfil their part of the contract if exercised.

There are many strategies investors can use in options trading, each with their own benefits and risks.

Benefits of Options

  • Leverage

    Tends to utilize capital efficiently by participating in an underlying asset's price movement without usually having a position in it

  • Revenue generation

    Potentially earn revenue by selling options for premium

  • Risk mitigation

    Can be used to help hedge against unfavourable market conditions


Things to consider

There are many things to be aware of when trading options. An important consideration to keep in mind is that the option seller (writer) can incur losses greater than the price of the contract. Consider each option strategy itemized below and the risks associated with it. Additionally, if the contract is not acted upon within the expiry date, it simply expires, and the premium paid to buy the option is forfeited by the seller. Note, TD Direct Investing automatically exercises options that are in-the-money for $0.01 or more.




Are Options right for me?

Options may be considered by an investor who:

  • Understands the underlying concepts of options trading
  • Understands the advantages as well as the risks of a chosen investment strategy
  • Knows how to manage a portfolio when reacting to changes in the market

Discover more about Options











Options pricing: clear and simple

It's the service, support, and overall experience of investing with us that defines the value for you.

  • Standard: $9.99 flat rate to buy or sell

    Canadian & U.S. stocks standard online commission rate.

  • Active trader: $7.00 flat rate

    150+ trades / quarter on Canadian & U.S. stocks, + $1.25 per contract for Canadian & U.S. options

  • What you get:

    • Real-time market data and quotes for the Canadian and U.S. markets
    • Exclusive research reports
    • Educational resources that are online and on-demand

Open an account online – it's fast and easy

Whether you're new to self-directed investing or an experienced trader, we welcome you.

  • Apply online

    It's easy to open a cash, margin, RSP, or TFSA account.

  • Call us

    We're here for you. Monday to Friday, 7 am to 10 pm ET

    1-800-465-5463 1-800-465-5463
  • Book an appointment

    Let's chat, face-to-face at a TD location convenient to you.


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