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Robinhood vs Fidelity for selling options: what actually differs

Both brokers let approved customers sell covered calls and cash-secured puts. Robinhood is built around a simple app with no per-contract commission. Fidelity is a full-service broker with more account types and deeper research. Neither is the right answer for everyone.

Comparison · 6-minute read · Updated 2026-10-26

The short answer

For selling options in the wheel strategy, both brokers can do the basic job: covered calls on shares you own, and cash-secured puts with the cash set aside.

The main differences, in general terms:

• Fees: Robinhood doesn't charge a per-contract commission on options. Fidelity has long charged one. Both pass on small regulatory and exchange fees.
• Tools: Robinhood keeps the screens simple. Fidelity offers more research, more order types and a desktop platform.
• Accounts: Fidelity offers a wider range of account types. Robinhood's range is narrower.

This page isn't an endorsement of either. Fees, features and approval rules change, so check the broker's current help pages before you decide.

Side by side

How approval works at both

Neither broker lets you sell options on day one. You apply, answer questions about your experience, income and goals, and get an approval level.

• Covered calls usually sit at the lowest level, because the shares cover the risk.
• Cash-secured puts sit at the same level or the next one, depending on the broker.
• Spreads and anything using margin need higher levels.

If you're turned down, you can usually reapply later. Be honest on the form. The levels exist to stop new sellers from taking risks they can't carry.

A worked example (an illustration, not a trade idea)

Say you sell one $45 put on a made-up stock, XYZ, for $0.50, and buy it back later. To keep the math simple, Broker A charges $0 per contract and Broker B charges $0.65. These numbers are illustrations; check each broker's real pricing.

Two lessons.

First, commissions matter most on small premiums and many trades. On a $50 premium, $1.30 is a real slice. On a $500 premium, it's minor.

Second, look at the bottom row. The difference between brokers is $0.65. The difference between a good trade and a bad one is $700. The broker choice matters far less than the stock and the strike.

Spreads also cost money at every broker. A wide gap between bid and ask can cost more than any commission. See bid-ask spread vs commission.

What to look at before choosing

1. The account you'll use. IRA, taxable, joint? Check that the broker allows selling options in it. See IRA vs taxable account for selling options.
2. How assignments are handled. What happens if you don't have the cash? Some brokers close at-risk positions near expiry on their own.
3. The options chain. Can you see Delta, Open interest and the bid-ask spread on one screen? See how to read an options chain.
4. Order tools. Can you place a limit order to buy back at a set price, good until cancelled? Can you roll in one ticket?
5. Fees on exercise and assignment. Some brokers charge for these; many don't. Check.

Which one fits you?

• New, small account, a few simple trades: an app-first broker with no per-contract fee keeps costs low. Make sure you still see the full chain.
• Larger account, research matters, IRA too: a full-service broker's tools and account range may be worth the per-contract fee.
• Many trades a month: fees add up. Work out your own yearly total at each broker before you pick.

In Canada, neither broker is the usual choice; Canadian sellers tend to compare Questrade, IBKR and Wealthsimple. See Questrade vs Interactive Brokers for options. Covered calls are widely allowed in a TFSA or RRSP; cash-secured puts depend on the broker.

Questions