Customer Service is Absolutely Essential
Here is another area that you need to take a long and hard look at. Since you are a new trader, you will likely encounter many issues that need to be taken care of. These include learning how to make deposits and withdrawals, seeking advice on trading options, and a multitude of other issues that may crop up during your trading sessions. Before you register and deposit at any binary options broker, it’s imperative that you contact customer support to see how responsive they are to your requests. If you find that they are highly responsive, professional and courteous, that’s definitely a good sign.
The Trading Platform
This is one area that is often neglected when traders choose one binary options broker over another. However, a user-friendly, technologically advanced and fully functional trading platform is your lifeblood in binary options trading. Did you know that most top brokers offer web-based platforms? Several brokers will try to get you to download their trading software onto your computer, thereby potentially putting you at risk for spyware, malware and viruses. Avoid brokers that require a full download.
Now that you know what to look for in a binary options trading platform, you should also select a platform that offers you as many tradable assets as possible. You don’t want to be limited to just a handful of assets that you may not enjoy trading. Major asset categories include stocks, indices, currencies and commodities. The trading platform should be able to accommodate multiple trades and multiple options simultaneously. Freezes, interruptions and incomplete trades are a sure-fire recipe for disaster with a faulty trading platform.
Regulation Is Incredibly Important
Binary options trading is a relatively new form of investing. As a matter of fact, retail binary options trading didn’t become popular until just a few years ago. With that said, because this investment vehicle is so new, there is little regulation in the market when you compare it to stock trading and other traditional investment vehicles. Nonetheless, there are a few nations that are pioneering regulation in the industry and ensuring that binary options trading is a safer process. Those nations are Europe and the United States. However, there are still several developed nations that don’t yet offer binary options regulations.
Binary Options Regulation In Europe
Because binary options is still a relatively new form of trading, there are only a few countries within the European Union that currently have binary options regulations set in place. In areas like Cyprus, the United Kingdom, and Malta, financial trading is strictly regulated; requiring brokers to be licensed and follow strict procedures in order to offer the service. It’s also important to note that while not all European countries currently have regulations in place, it is advised that traders work with brokers that are currently licensed in one of the countries where this layer of protection is offered.
Binary Options Regulation In The United States
When it comes to binary options trading in the United States, rules have become a bit more strict. As a matter of fact, according to the CFTC, it is not legal for any off-shore binary options broker to offer retail trading services to customers in the United States. Therefore, if you plan to trade in the United States, you’ll need to choose a United States based broker. Here’s a quote from the CFTC on the topic of binary options regulation and who can solicit US traders…
“It is against the law to solicit U.S. Persons to buy and sell commodity options, even if they are called ‘prediction’ contracts, unless they are listed for trading and traded on a CFTC-registered exchange or unless legally exempt.”
There are also several other rules that protect traders in the United States from predatory brokers and other unfair activities in the industry.
Binary Options Regulation In Canada
Canada is one of the several nations that currently doesn’t regulate the trading of binary options. However, even though binary options aren’t currently regulated in Canada, they are incredibly popular. As a matter of fact, Canada is the home of the largest binary options market in the world based on demand! Therefore, it is expected that the country will soon start to regulate what they now consider to be “exotic options”.
Assets Make A Huge Difference
In the world of binary options trading, it’s your job to predict the price movement of underlying assets. Therefore, when trading, it’s important that you have several assets available to choose from. Choosing a broker that offers a large asset index will help with the risk management process; as more assets gives you a better opportunity to diversify. Also, brokers with large amounts of assets tend to offer many that are considered to be highly predictable; essentially making your job as a trader much easier. So, as you compare, make sure to find brokers that offer large asset indexes.
Trading Tools & Educational
Another thing to keep in mind is the fact that no matter what job you’re doing, tools are likely to make you more efficient. That’s an overwhelmingly true fact when it comes to trading. In the world of binary options trading, there’s an endless tool box filled with various things to make your life easier. Each trader will offer their unique list of tools and educational materials. So, when comparing binary options brokers, make sure you take the time to check out the tools and educational resources they provide to make your trading day more efficient.
Payout & Bonuses
One of the most appealing aspects associated with binary options trading is the massive payouts the industry is known for providing. However, each broker is a business; and because traders aren’t purchasing assets, but instead are making predictions on values, the brokers ultimately set the level they are willing to pay on profitable trades. Therefore, you’ll notice that payout levels will vary wildly in the industry. So, it’s well worth comparing payouts when comparing brokers to ensure that you make the most money on your in the money trades.
If you plan on trying your hand at binary options, choosing a good broker is half the battle to becoming successful. Making sure to compare the factors above when choosing a broker, you can rest assured that the one you chose is going to be the best option for you!