Binary options brokers play a considerable role when it comes to this form of trading. At the same time, there are a lot of suspicions surrounding these agents. This is typically to do with the fact the majority of binary options scams are directly related to the brokers. Prior to getting involved in this form of trading, you need to be well versed with the major players. Here is what you need to know about binary options brokers:
Not All of Them Are Licensed
Now, this is an important distinction to understand. There are very few binary options brokers that are actually licensed by trading authorities such as CySEC. This is done so that they don’t have to abide by the limitations set by these agencies. This is actually quite normal with binary options trading and so it isn’t always a warning sign. That being said, there is a certain level of risk associated with registering with unlicensed brokers. This is why you will have to do considerable research on these brokers before you decide to set up an account with them. If you do find a licensed broker, make sure to check their certification number on their website on the various licensing authority sites. This is the only way to ensure that the registration is legitimate.
Differing Registration Rates and Processes
Since few brokers are licensed, there aren’t any sign up regulations that they need to adhere to. This means that this process can drastically change from one broker to the next. For instance, some brokers will not charge you anything at all and will only require to put money in your account when you start trading. Others will require to set up an account with a certain amount of money. The amount that you will have to deposit will typically depend on the account type that you are signing up with. Some brokers have different account classes while others have only one that you can use.
Variation in Assets
Brokers will pick and choose which assets to offer their clients. Now, there are roughly about 180 assets to choose from in all so it can be difficult for brokers to make them all available. This is why you should look at whether or not the broker in question will provide you with the assets that you plan to trade with.
Dissimilar Terms and Conditions
The terms and conditions are where it can get a little tricky with binary options brokers. This is why it is important for you to carefully go through all of them before agreeing to anything. There are a few things that can trip you up with these policies. The most common one is deposits and withdrawals. This means that you have to deposit a minimum amount of money into your account, every time that you want to replenish it. With withdrawals, it is more about the maximum amount. You will be restricted in just how much you can withdraw from your account in one go. You may also be required to leave behind a certain amount of money in your account. Another thing to watch out for is the processing times for permitting such withdrawals.
Binary options brokers are under no obligation to provide any other services apart from letting you set up an account and then placing trades with them. As such, each broker gets to decide what type of services they want to offer you. For instance, some may provide you with educational tools and demo accounts while others may have promotional advantages. Some of these are helpful while others don’t really help you with your trading. Therefore, it is vital that you separate the actual benefits from the fluff.
This what you need to know about binary options brokers. This makes you better equipped to choose ones that are above board.