Binary options trading is a fairly recent investment strategy. This alone can make it more difficult to find high quality brokers than it would be to find brokers for more conventional investment vehicles. Most investors have a track record with brokers that use for commodities and equities, but if you do not have any experience with binary options, it's easy to fall prey to binary scams. Like any other investment, it pays to look into the background of option brokers before plunking down your money on an option.
It's not just binary options scams you need to watch out for. Brokers have broadly different terms and conditions for their account holders, and they offer many different deposit promotions and payout methods. Depending on where you're located, it can be inconvenient to contact some brokers for customer support and trading room support if they have limited hours in a foreign time zone. Some brokers offer VIP service at much lower trading amounts than other brokers.
If you're completely new to trading, you might find the educational materials offered by some binary option brokers more useful than other brokers who assume you already know how to invest. We've compiled a list of features to look for when shopping around for binary option brokers that will make your choice easier, and steer you away from binary options scams.
Examine the Investment Conditions
All brokers have minimum and maximum deposit amounts. They also place limits on minimum and maximum trade amounts. These figures can give an investor a really good impression of the size of the brokerage that they'll be dealing with. Do not use binary option brokers that require big deposits but only allow small trade amounts. Those terms maximize the amount of money in the brokerage's bank accounts, but do nothing for the investor. Match the broker to the amount of money you have to invest, and choose brokers that allow trades in the dollar amounts you prefer. Keep in mind that you may get better service from a smaller broker if you place a maximum deposit instead of a minimum deposit with a bigger broker.
Deposits and Withdrawals Should Be Easy
One common signal of binary options scams is an unusual method of deposit and withdrawal. If a broker does not offer the usual electronic payment methods, you should be very wary of the amount of time it will take to get your money out of the account. It can take weeks, or even months, for some electronic payment methods to return your deposit funds, because they're waiting for notification from the broker to release the money, or for the broker to redeposit the money so that it can be returned to you. During this period, it can be nearly impossible to determine if you're going to get your refund. The longer the period between the time you ask for a withdrawal and the time you realize you're not going to receive one can make it hard to collect the money through legal action. Even if you're able to get your money, it can be frustrating to wait for it, and the money collections interest for the brokerage house, not for you. Stay away from brokers that do not use deposit and withdrawal methods you're accustomed to.
Find Out Who Trades What
If you want to place binary option trades in a certain sector, or even for particular companies, do not settle for a broker that has a limited selection of assets in their portfolio of available options. There are many ways to determine the options available from a particular brokerage, but when in doubt, simply contact them and ask about a particular asset you're interested in. You can get a good idea of the kind of customer service you'll receive by the speed and accuracy of the answer you receive.
Customer and Trade Room Support is Important
The banking and withdrawal services of a brokerage should be frictionless and easy. It's customer support and trade room support that should be the focus of customer service for binary options brokers. If all the support functions of a particular brokerage seem to be pointed towards getting your money into their accounts, find another broker. Look for brokers with excellent support and guidance for choosing your assets for your binary option investments, with immediate help on your preferred platform when you need it.