Comparing Binary Options Brokers: Here’s What You Need to Know
In order to find the broker that matches your needs in the best possible way, it is essential that you first compare different binary options brokers. Different brokers have different criteria which may not necessarily suit your needs. But in order to best compare binary options brokers, you need to know the key parameters on which to evaluate them. In this article, we tell you the most important things to look at in order to compare binary options brokers.
Licensed vs. Unlicensed brokers
Binary options brokers are either licensed or unlicensed. Brokers who are licensed have acquired a license from CySEC. In addition to that, they have also been registered with different EU regulators. Other CySEC licensed brokers even have licenses from FSBR (New Zealand) or ASIC or South Africa. Every single licensed broker doesn’t accept traders from the US. In United States, the brokers regulated by SEC are Nadex and CantorExchange.
In the case of traders outside United States, there is no reason to trade with unlicensed brokers.
A typical broker will require a $250 initial deposit to open for you an account. Brokers tend to have different types of accounts for beginner level, intermediate and advanced-level traders. One way to compare binary options brokers is to look at what a broker offers a beginner you. It’s also important to compare different platforms and choose the one that you like most.
It is recommended to choose a broker with low minimum as this gives you an allowance to play with the platform as well as compare it against other brokers and platforms out there.
You will come across brokers who try to make you pay a larger deposit. These will tell you that the only deposit they allow is $1000 onwards. This is a huge red flag.
It might have already occurred to you that binary options brokers look one and the same. This is because all brokers use one of the four trading platforms. They could both be using same platform but belong to different firms. An example is the case of Boss Capital and 24Option. All these use TechFinancial platform but one is licensed while the other one is not.
There are however other brokers who have come up with their own trading platforms. The main difference between the brokers that use same platform comes in the returns offered. While some brokers give a return of 70% on EUR/USD, others give a return of as much as 85%.
It can be quite a challenge to compare binary options brokers using similar trading platform. So how can you proceed? The good news is that there are some brokers who give traders something unique.
Some brokers offer traders something known as boundary option. On the other hand, GOptions, on the other hand, came up with a signal system that enable traders to compare and contrast signal providers. After that, they can elect to auto trade or even reverse trade signals. Therefore, despite using the selfsame platform, you can still be able to distinguish between brokers by looking at the unique products they offer.
Bonus Offers & Special Offers
Another way to compare binary options brokers is to look at their signup bonus. Majority of brokers give traders a risk-free trade bonus or a 100% signup bonus. But some brokers use the bonus issue to attract traders, which is why you need to be a little careful about them. As well as welcome bonus, also pay attention to important issues like minimum deposit.
The maximum gain
This refers to the percentage yield or the ROI (return on investment) in a gain position. A higher percentage indicates a better yield during the gain. As an example, assume that you have $100 in a position which closes with highest gain of 90 per cent. This means that you will get a profit of $90. It means that after closing, you will be paid $190 by the broker.
Return on a Loss
This refers to the percentage yield when you are in a losing position. A higher return on a loss percentage means lower loss. For instance, if you have invested $100 where the return on a loss stands at 15%, you will be given $15 by the broker despite you losing. Therefore, you will have lost $85 in that transaction.
The minimum position
This is the lowest amount you need to invest for you to open binary option transaction. A lower minimum amount means that you will be able to invest smaller amounts of money in your transactions.
The demo account
Although relatively rare, the demo account refers to possibility of trading through a fictitious account by using virtual money.
The maximum bonus
This refers to the highest amount of bonus offered by a broker during real money deposit. A higher amount is obviously the better deal.
Do you want to trade binary options through your phone? If so, you will want to pay more attention to this feature.
No deposit bonus
This is also relatively rare and it refers to the actual amount of money that can be offered to you by a broker without it having to necessarily make a money deposit upfront.
The social criteria
You can also compare binary options trade by looking at their brokerage firms. The following are the most important things to consider.
• The headquarters
This is where the broker’s parent company is based.
• Year of establishment
You need to pay attention to this because it will inform you how long the broker’s parent company has been in business and hence how experienced in trading the broker is.
• Deposit and withdrawal methods
It is also important to observe withdrawal and deposit methods. Does the firm offer your preferred means of depositing and withdrawing your funds?
Lastly, read reviews and testimonies from fellow traders regarding each broker. A broker with positive reviews obviously is worth giving a try.
For you to find a top binary options broker, it is important to do thorough research. This will then help you choose the best broker that suits your needs. The above are some of the things that will help you compare binary options brokers. Stick to them and you will pick the best broker matching your needs.