In this post we explore the various factors traders need to consider when choosing a binary broker to trade with online. Unfortunately because the binary trading industry is still largely unregulated, there are a number of brokers out there that are running some very dodgy operations and effectively stealing hard earned money from their customers. The good news is that as a trader you can easily avoid using these types of brokers by making sure you are well informed and educated about what to look for when selecting a binary broker to trade with. There are a number of resources and sites on the web that provide this information but we have decided to list the factors that we personally believe should effect your decision when choosing a binary broker to invest with. We will also provide a broker blacklist which includes some of these sites you definitely want to stay away from.
Because there are now so many brokers to choose from, we feel its important that you trade with the larger brokers. These are brokers that have been around for a number of years and have built up a customer base that can sustain their business through good and bad times. The larger brokers also tend to have a more complete and solid back end operation which translates into higher levels of service and more professional and informed customer and trader support departments. In addition, the larger brokers tend to also have higher liquidity and can afford to take bigger knocks or losses and still be around the next day i.e. not just simply close and run off with their clients funds. Although there are some smaller boutique brokers out there that focus more on quality and VIP service, in our opinion we strongly feel you are in safer hands in the long run if you trade with the larger brokers. FOR one thing, you are almost guaranteed that you funds are safe and secure and that you will always have recourse in the event something happens that could negatively effect the operations of a particular broker. Stick with the bigger brokers, there are many of them and they are all pretty competitive, no need to go and risk trading with a smaller or unknown broker.
Price and Markets
Unfortunately this has become far too common whereby the data and prices that the brokers are trading on are not updated or do not reflect the true market prices. These brokers effectively are manipulating the actual market prices by offering different prices then to what the markets dictate. It is one of the biggest problems these days with binary brokers, they purposely provide incorrect market prices or their price feeds are delayed in order to rip their customers off while they trade. Its very easy to spot these brokers, simply open up Reuters feeds and compare them to the brokers feed and if there is any delay or inconsistent price fluctuations then you know the broker is taking you for a ride.
Pay me when I win!
Another major problem is when you do perform a successful trade and finish in the money, you expect the broker to pay you your dividends immediately and without delays. A lot of brokers out there are now using delay tactics to try and get you to continue trading or to reverse your withdrawal. Often the brokers make excuses by saying that they sent the funds and that you would need to check with your bank why the funds did not arrive, meanwhile they never sent the funds to being with. There are so many tactics that these types of brokers use today that eventually the customer gives up and either reverses their withdrawal, start trading again and eventually end up losing their dividends on subsequent trades. Alternatively some traders just give up trying all together.
Licensed and Regulated Brokers
Make sure to stick with those brokers that are licensed and regulated because as a customer then you will almost always have some form of recourse by being able to contact the licensing authority should there be a complaint. In addition, and most important is that all licensed binary options trading brokers are required to hold clients funds in completely segregated accounts which are not in fact controlled or owned by the brokers themselves but rather by the licensing authorities. In the event that a brokers would go bell-yup, at least these funds would still be accessible and would not be available to creditors should the broker go insolvent.
Friendly and Professional Customer Service
We believe in the ethos that the customer is always right. Well, most of the time that is. In the case of the binary brokers customer service department, their agents and support staff need to act in a friendly and professional manner and in addition they need to always respect their customers wishes. IF you are trading with a broker where you just don’t agree with the way they handle their customer service employees then simply switch brokers. There are enough good brokers out there offering excellent customer service to choose from.