Choosing a Binary Options Broker
Choosing a binary options broker can sometimes seem like an overwhelming task, but equipped with the information above and the insights on what separates the good from the bad, you can make an informed choice and narrow the selection down to a manageable number of brokers.
#1 Use a Regulated Broker
If traders could look beyond the glamorous sales pages and take action on this point, majority of the horror stories in the binary options market would have been prevented at this point. It is imperative that traders choose a regulated broker. Regulation ensures a number of things:
a) Ascertain the identity of the broker and make sure that the broker in question is qualified to be a broker and not some criminal just out of jail and looking for a quick buck.
b) Make sure they have an address that can be pin-pointed, located and known to all and sundry, and to ensure that they are not fly-by-night operators.
c) Ensure segregation of traders’ funds. You do not want brokers getting access to your money to pay for their CEO’s wife’s shopping expenses.
d) Ensure that their market conduct is transparent.
e) Ensure that you are paid your money when due and without delay. There are always more losers than winners in the binary options market, so brokers doing genuine business have no excuse not to pay you from segregated funds.
Many brokers in the binary options market are unregulated. 90% of binary options brokers operate from Cyprus, and after some complaints of unscrupulous practices by brokers, the Cyprus Securities and Exchange Commission (CySEC) has finally decided to take action. All binary options brokers have been given till the end of the year to obtain licenses or shut down. This means that by 2013, there is no reason to be using a so-called Cyprus-based broker whose regulation status is indeterminate.
Who Regulates Binary Options Trading in Different Countries?
USA – Chicago Board Options Exchange (CBOE)
Australia – Australian Securities and Investment Commission (ASIC)
Europe – Cyprus Securities and Exchange Commission (CySEC)
#2 Pricing Transparency
Some brokers are guilty of the following price manipulations:
1) Assets not being available for trading when there is increased volatility.
2) Trades at breakeven point pushed into loss territory with a few moments to trade expiry.
3) Price of bets or payouts being adjusted unnecessarily.
To avoid these problems, deal with a broker who provides Level II pricing so you really know what is going on in the market.
#3 Ease of Transactions
Unless you live in a country under a global financial blacklist, there is very little motivation to still rely on the time-wasting bank wires for transacting with a binary options broker. There are many of them who now offer instant deposits and withdrawals using a variety of methods such as credit cards, e-wallets and PayPal. Try and get a broker that makes deposits and withdrawals a breeze.
#4 Choice of Contract Types
Use brokers who are not restrictive in their asset offering or in the contract types offered for trading. A trader should be able to have the power to choose, and those powers are eroded when the asset listing or contract trade types are restrictive. When brokers provide several trade types to choose from, it is easier for the trader to practice all and then make a pick of the preferred assets/trade type.
#5 Customer Service
It is simply not up to it for a broker to leave an email unanswered for a whole week, but that is what a broker whom we shall not mention here actually did to one of our people who was testing one of their bonus services. Choose a broker who has at least an 18 hour work day for their customer service department so that they can be available to answer your inquiries.
These are some of the key points to look out for when choosing a binary options broker in today’s markets.
Take a look at the following brokers recommended by our staff at BinaryOptions.com. In particular we’ve taken into account: payouts, market availability, binary options types, customer support and promotions.
Regulated Binary Options Brokers:
Other Fixed-Odds Options Brokers:
Binary Options by Payment Providers:
- Binary Options Brokers which Accept Paypal
- Binary Options Brokers which Accept Moneybookers
- Binary Options Brokers which Accept Credit Card
- Binary Options Brokers which Accept Western Union
- Binary Options Brokers which Accept Debit Card
- Binary Options Brokers which Accept UKASH
- Binary Options Brokers which Accept Neteller