Binary options have become popular with Internet users and there are many offers and online brokers. There is always a place for dummies and many brokers offer returns of up to 85% when the trader wins on their sites. It is in the face of such offers that customers have questions, as they are wary of possible scams.
The principle of trading on binary options
The Chicago Board of Options Exchange or CBOE introduced binary options trading in 2008 to open the doors to the world of finance to the general public. The number of brokers has continued to multiply since this period, especially in 2010 and binary options quickly became popular on the internet. The system adopted for this mode of trading is based on a simple and easy to understand operation, because being a binary options trader does not require in-depth studies in the field of finance. It is a matter of speculating on the movement of the rise or fall of the value of the price of an asset allowing the trader to win if he has bet in the right direction or to lose in the event opposite.
Several online brokers offer substantial returns in the order of 85% according to their advertisements. However, traders are questioning the veracity of these numbers and fear the scam . For beginners in the field of binary options, some sites offer the possibility of creating a virtual account or demo account to simulate trades and become familiar with the trading environment .
Understanding the rate of return
There are many sites offering their services as online brokers. Therefore, it is difficult for a trader to choose a good broker. Some sites offer their customers huge bonuses after the first deposit to increase their customer base. Others offer substantial profits to attract traders looking for a good trading platform.
The rate of return on loss is also a significant consideration when selecting a broker. This is the sum received in the event of a loss calculated as a percentage of the speculator’s stake. Many sites offer profits ranging from 70% to 85%, however, it is not on all trades that you can take advantage of this 85% return, but particularly on assets that are difficult to predict.
Scams in this area
Binary options trading is a legal and regulated activity . However, there are some scam sites that make money off the backs of traders. You have to remember that it is impossible to win every time with binary options. And when the broker promises continual gains, that is another form of trading. scam , because the goal of these unscrupulous sites is usually to make traders lose as much money as possible in a short period of time.
To do this, malicious brokers offer Internet users a trading platform supposedly allowing them to make very significant profits. Brokers in this situation then encourage the speculator to always bet more and even after having suffered various consequent losses. Good risk management is essential in trading as well as a good knowledge of market information.
Bet on the fall or the rise on online stock exchanges
The basis of trading in binary options on the internet differs from the real stock market in certain points. However, this means is adequate for a large number of amateurs of the financial world and of speculating on asset prices, to obtain profits.
The option right allows the trader of the online stock exchange to bet on an upward or downward forecast in the value of a price over a predetermined period. If the speculator’s forecast of the direction of the price is correct, he wins and receives his percentage. But if the anticipation on the price movement is wrong, he loses his stake and still receives a return on loss.
Predict correctly in the financial markets
The basic principle of trading in binary options is thus whether a forecast is right or wrong. This can lead to believe that winning is a matter of luck, only it is not. It is essential to take into consideration the various information which can influence the value of a course. These include economic and socio-political news, the economic calendar, the trend, etc. Data relating to a company’s financial performance or decision-making makes it easier for traders to speculate on that company’s stock price, as this information has a great influence on the movement of values. The trading tools made available to Internet users are also of great help.