Story updated with early morning trade information.

CHICAGO (

TheStreet

) -- Online brokerage firm

OptionsXpress

(OXPS)

is returning $259 million to shareholders of its common stock through a special cash dividend of $4.50 per share, it said Monday.

The dividend will be payable on December 27 to shareholders on record as of December 13, the online broker said.News of the dividend appears to have boosted the company's stock, with shares up nearly 10% to $18.49, in premarket trading.

"We are choosing to return some of this cash to shareholders due to the strength of our business model and balance sheet, current lack of immediate value-creating acquisition opportunities and the potential increase of dividend tax rates in 2011," OptionsXpress CEO David Fisher said in a statement.

The company had previously noted that it was looking at ways to best use its excess cash.

OptionsXpress CEO David Fisher: Q&A

OptionsXpress targets sophisticated investors with tools for derivatives trading, specifically options and futures, but customers also have the ability to trade equities on the platform. Ironically, the Chicago company's niche focus is an area that larger rivals,

TD Ameritrade

(AMTD) - Get Report

,

E*Trade Financial

(ETFC) - Get Report

and

Charles Schwab

(SCHW) - Get Report

, are increasingly trying to offer expand on their own customer platforms.

OptionsXpress cash and investments for the period ending September 30 totaled $269 million, it said. The company has also secured a $120 million four-year variable rate term loan to cover a portion of the dividend payout with the remainder to be funded by available cash, it said. After taking into account the impact of the transactions, the company would have in excess of $125 million in company cash and investments as of this announcement.

"In determining the size of the dividend, the Board sought to insure that we maintained sufficient capital to support current operations and, more importantly, capitalize on growth opportunities in 2011 and beyond," Fisher said. "We believe that this $4.50 special dividend combined with a term loan in a historically low interest rate environment, achieves those objectives while affirming our long standing commitment to return value to shareholders."

OptionsXpress shares were flat at $16.93 before the market opened.

-- Written by Laurie Kulikowski in New York.

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Laurie Kulikowski

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