Binary options trading is an exciting and lucrative way to make money from tradable assets. Unlike many other types of trading, you don't need to own the underlying asset. James H, a binary trader, describes binary options trading as “a great and relatively fast and easy way to make money if you know what you are doing.” All you need to do is predict the price movement of the asset. If your prediction comes true, you earn money. If the market goes against your prediction, you lose money.
Binary options trading is unregulated, so you must be careful when selecting a binary options broker. In this guide, we will go over everything you need to know so you can decide which binary options platform is right for you.
Factors to Consider When Choosing a Binary Options Broker
The internet has many financial services firms offering binary options trading services. They offer a lot of enticements, such as colossal signup bonuses and free withdrawals/deposits. While these are impressive, there are more critical things to consider before choosing a binary options brokerage company. Here are the five most important ones.
- Platform: Every broker offers a trading platform for binary options. You should identify and examine all the features and functionality of the broker's trading platform. The standard features on a trading platform include order placement, technical analysis tools, algorithmic (automated) trading and demo trading. You can test all the features by using the demo trading option.
- Regulation: Binary options trading is largely unregulated. However, it would be best to stick with brokers regulated by a reputable financial authority. Reputable brokers like IQCent are regulated by international regulatory bodies like The International Financial Market Relations Regulation Center (IFMRRC). If you trade with an unregulated body, you must be careful and invest wisely.
- Fees: Brokers have different trading fee structures. These fees apply when trading binary options or making withdrawals or deposits. Generally speaking, brokers do not charge deposit fees, but you must cover any fees charged by the payment processor. But many brokers charge commission fees and withdrawal fees. Contact customer support if you can't find information on the fee structure.
- Assets: You need to check out the assets available for trading. The most common assets are forex and stocks. Other assets you may find include commodities, indices, bonds and cryptocurrency. Traders signing up on the IQcent platform can access over 100 tradable instruments ranging from currency pairs to stocks, indices, and cryptocurrencies. Ensure that the broker offers your preferred assets before you sign up.
- Customer Service: In a perfect world, trading binary options should be smooth. Unfortunately, there are a lot of potential issues that can come up. These issues include problems with deposits/withdrawals, problems with signing up and accessing the trading software or needing special assistance for peculiar cases. For these reasons, you should choose a broker that offers round the clock easy accessible customer support.
How to Evaluate Binary Options Brokers
By following our advice in the previous section, you will find several binary options brokers you can trade with. The next step is to compare these brokers and choose the one you want to trade with. Here are some tips for evaluating and comparing different brokers.
- Establishment date: In our experience, newly formed brokers are unreliable. Some of them turn out to become reliable binary options traders. But in most cases, companies founded a few years ago can go out of business. This can be due to funds mismanagement, harsh economic conditions, unsavory policies or as an exit strategy to scam depositors. Weed out the recently formed companies and focus on those who have proven themselves in the market as veteran brokers.
- Regulation: Unregulated brokers exist. Some are reliable, but the majority are pyramid schemes that exist only to scam investors. We recommend you avoid any broker that does report to any governing authority in a local jurisdiction or as part of an international non-profit organization.
- Offices: If a broker has an office address, you should consider it seriously. The best binary options brokers have physical addresses that they display on their websites. Brokers that don't have physical addresses listed on their websites usually turn out to be scammers.
- Trading conditions: This is a matter of preference. Check the trading conditions to see if they are suitable for you. For instance, some brokers only offer a couple of tradable instruments. If your preferred assets are included in their offerings, you can trade with them. Other things to consider include deposit bonuses and trading rules. Review all trading and non-trading parameters to prevent unpleasant surprises.
- Response time: During the first stage, you only focused on brokers that offer customer support. We recommend you contact the support team to see how well and quickly they respond to queries. You don't need to have any issues in particular. Just send them a message and see how prompt their response time is. This will provide insights into how quickly they can resolve any issue you may have in future.
- Customer reviews: Feedback from current and past customers will help you get a complete picture of what to expect from a binary options broker. Some reviews may be biased, but most are usually truthful and helpful indicators of a binary options broker's service. We recommend you do your findings before reading reviews so incorrect malicious reviews won't sway you.
Top Binary Options Brokers
Here are some of the best binary options brokers in the market.
- IQcent: The IQcent broker is the most recommended binary options broker for everyone, regardless of their experience level and speed trading instruments. The broker offers 24/7 fast response customer care and fast trade executions. They also offer services of qualified personal managers on a need-for basis. Other exciting features include their deposit onesies, a wide range of electronic payment systems and a proprietary terminal with built-in technical analysis tools for standalone and copy trading. The minimum deposit is $20, and binary options traders can deposit using the following currencies: USD, EUR, GBP, BTC, and ETH.
- BinBot Pro: The BinBot Pro brand is a collective designation for a suite of ready-made binary options trading bots. You can use these bots on top binary options trading platforms like IQcent, Binarycent, and RaceOption. The best part is that you don't need previous knowledge or experience with a programming language or market analysis. Just choose a broker, open a trading account and fund the account. Next, connect any of the trading bots with your account. The bots will help you trade binary options and make profits on your behalf. The robots are great for algorithmic trading, that is, trading that does not require human participation. The minimum deposit for these binary trading bots is $250
As you can tell, finding the best binary options broker for your reading needs involves several factors. Consider all of these factors before opening an account. Some brokers offer low deposits; others offer copy trading and swift customer care support. You should focus on a broker that fares well in every category. Other essential aspects are payment methods, regulations and commission structures.
One solid broker in this regard is IQcent. The minimum deposit requirement depends is among the lowest on the market. We also support algorithmic trading and copy trading. Take your time to study each broker and choose the ones that offer quality services.
Binary options are trading options that pay a fixed monetary reward or nothing, depending on whether the market aligns with your predictions.
Yes. You need a broker to trade binary options. Check our article on how to choose the best binary options for your trading needs.
The critical difference is that a regulated broker reports to a governing authority, while an unregulated broker reports to no one. In many cases, an unregulated broker can turn out to be a pyramid scheme or a scam. Financial advisors advise novice traders to stay away from unregulated brokers.
Yes. Many binary options brokers offer mobile-friendly binary options trading platforms.