Best way to avoid binary options scams
This is a question which is frequently asked and the simplest answer is no. This type of trading is recognized by financial regulations as a viable investment opportunity. However, this does not mean that there are not those who wish to create a binary options trading scam and relieve you of your capital. One of the best ways of avoiding a scammer is to simply stick with the best brokers; as indicated by one of the many surveys which have been conducted.
There are also other ways of checking and validating a binary broker to ensure they are genuine the final test, once you have committed to an account, is to start with the least possible funds, avoid bonuses and trade small. You can then assess your ability to win trades and how easily you can access your funds. Even a small issue on the platform should be looked at further; you need complete confidence in your broker!
Ways of Spotting a binary options trading scam
-
Time is one of the biggest assets a broker can use. If you agree to a trade which expires in five minutes and the price is moving upwards the broker may, in order to avoid paying out any funds, allow the trade to continue an extra minute in the hope that the trade will then go against you. Even a tiny timeframe such as this can make a dramatic difference. You can time the trade yourself, but you will probably find that the broker has a message on your screen suggesting that the trade is expiring. This buys them time and ruins your trade. If you see this type of message be very wary.
-
Logos. Many sites have the logo on their sites of some of the biggest names in the market. However, this does not mean they are authorized to use them. It is wise to verify any logo before you assume it is genuine.
-
Another trick is to make the site slow down, or even freezes as trades are due to expire; this will ensure you are unable to confirm whether your trade ended in the money or not.
-
Compare the prices on your broker’s site to the actual market prices; particularly the ups and downs through a trade. The movements may be reflected very badly, allowing the broker to select when a trade finishes and the result you are given.
It is important to understand that a legitimate broker will make their profit from the difference in each trade. Every trade should have one trader going in an opposite direction to the other. One will lose and one will win the trade; the difference between the profit and loss of these two traders is the return for the broker. They do not need you to lose to get their funds as one trader always loses and one always wins. You are, therefore, being given a fair chance to trade successfully.
Of course, a scam site may operate differently; in effect pitting you against the house every time until they have all your money. However, these are the brokers which you should avoid. By choosing and using a reputable broker you can avoid the scams and make a good rate of return on your investments.
