A Guide To Comparing Brokers In Binary Options:
- Accessibility, Usability, And Service
- Financial Considerations
- Trading Capabilities
- Regulatory Issues
- Training / Reference Materials
- Final Word
1. Accessibility, Usability, And Service
1.1 Linguistic Considerations
If you’re a native English speaker, this is an important point that you might well overlook. English is the lingua franca of the business world, and there is no shortage of great trading platforms designed for the language. Traders with a limited knowledge of English – as well as those who are wholly unfamiliar with it – need brokerages that are capable of communicating in other tongues.
Many trading platforms have sought to gain a competitive edge in the marketplace by offering simple, easy-to-grasp interfaces. Although a user-friendly trading setup is often a boon to the novice trader, bear in mind that you might well be missing out on advanced options if you pick a user-friendly platform. If you’re already an experienced trader and you’re looking for specific tools, don’t be swayed by usability if it comes at the cost of advanced features.
1.3 Service Programs
The number of new traders entering the binary options markets is swelling every day. This glut of new traders is a vast crowd of novices at every possible skill level. Many of them need a helping hand and a knowledgeable voice in order to get their trading careers off to a good start. This is why customer support is a significant factor that you should investigate when you’re picking a trading platform. How much novice-oriented help is available? How much do you need?
2. Financial Considerations
2.1 Fees And Refunds
Obviously, every trader wants to do business with a broker that charges the lowest possible fees. When you make an In the Money trade, it’s that much more satisfying when your final takeaway is 80 percent rather than 65 percent. Don’t forget to look at the refund that’s offered to you on Out of the Money trades. A favorable refund policy may be the deciding factor that makes you pick one broker over another.
2.2 Promotional Offers / Bonuses
Brokers know very well that a certain number of traders will sign on with any firm that offers lucrative bonuses or limited-time offers. Always take the long view when you’re comparing trading platforms, and don’t let a limited-time offer you tempt you into signing up with a company that’s not going to treat you well in the long run. Make sure you review the terms and conditions involved in claiming any attractive bonuses, too. Big money bonuses often require you to complete a fixed (and rather large) volume of trading before you get to cash in.
2.3 Account Minimums
This is especially important for brand new traders who are looking to get their feet wet in the binary options game. Many of the best trading platforms out there require a certain minimum deposit to get started, and this sum can be intimidating to someone who’s not even sure if binary option trading is right for them. Don’t commit thousands of dollars to opening a professional-grade trading account if you haven’t had any binary experience yet. It’s better to deposit a few hundred in a “trial” account, even if the platform in question isn’t as favorable as the pro versions.
2.4 Money Management
Some brokers follow an ethically-shady strategy to keep your money in their hands – they make it as tough as possible to withdraw funds from your trading account. Making smart trades and swelling your brokerage balance is great, but it can also be frustrating if you’re dealing with a company that’s going to make you jump through hoops to get your money. Look at deposit procedures, too. Most traders would prefer a simple account that can be loaded and unloaded via PayPal rather than one that requires wire transfers.
2.5 Withdrawal Costs
Most binary brokers charge fees for withdrawals. Withdrawal fees should be a major concern when you’re comparing brokers. A lot of brokerages operate complex fee structures, and all of the fees that you’re dealing with may not be obvious at first glance. Study the broker’s Terms and Conditions carefully.
3. Trading Capabilities
3.1 Range Of Options & Trading Tools
Ask yourself exactly what kind of trading you want to do and look for the tools that make it easy. Are you going to stick with basic Up/Down options, or do you want a broker that offers a more diverse range? There are 60 Second options, Boundary Options, One Touch, No Touch, and many more. If you’re planning on doing advanced trading, look for the advanced tools (e.g. Roll Over, Close Now, Double Up, etc.) you’ll need to do it efficiently.
Most brokers tend to concentrate on options with different time spans. The market in binary options is diverse, ranging all the way from lightning-fast 60-second options to longer trades with expiry times measured in weeks or even months. As you gain experience and develop your own strategies for binary trading, make sure you’re working with a broker that fits your pace.
3.3 Trading Minimums
Take a careful look at the broker’s policies on minimum trade amounts. Make sure that the limits set down by the broker match the resources you have available. If you want to experiment with a limited account that has just $200 in it, working with a broker that requires a $20 minimum for every trade is going to cramp your style. Missing 10 trades will empty your account and put an end to your experiment. Brokers that deal in smaller positions are ideal when you’re starting out.
3.4 Asset Portfolio
Unless you’re extremely broad-minded, you’re probably getting into the binary trading game with a rather specific idea about what sort of assets you want to trade in. Don’t hesitate to make this a top priority; you don’t have to waste a lot of time evaluating brokers that don’t offer the assets that interest you.
4. Regulatory Issues
Despite the best efforts of various national governments, the world of binary options is still pretty untamed. Scams are a fact of life. If you want to protect yourself to the fullest possible extent, stick with brokers that are fully compliant with strong regulations. Of course, this is easier said than done! There aren’t nearly as many fully-regulated brokers as there are partially-regulated or unregulated ones. Do your homework thoroughly before making a commitment. You can check in our Recommended Brokers section for some excellent starting points.
5. Training / Reference Materials
As noted above, you’re definitely not alone if you’re entering the binary market without a lot of experience. There’s nothing wrong with looking for a broker that’s equipped to handle your skill level. The difference between random gambling and smart trading is largely a matter of education and training, and there are plenty of different brokers who will help you find it. Make sure you have the opportunity to use a demo account to get a feel for the trading process before you start putting your money on the line.
6. Final Word
There isn’t any foolproof formula for comparing one broker to another. The sheer number of different factors that are in play – and the way their priorities change for each trader – makes it impossible to establish truly objective rankings. Still, you can do a lot better than simply trusting your gut! Keep the points discussed here in mind when you’re weighing your options and make finding out everything you can about your chosen brokers the first part of your binary options education.