Tips on how to choose the binary broker
- It is important that you invest using a reputable broker. The most important aspect for any investor should be the safety of his funds. This is why we recommend using one of the brokers listed above in order to make sure you stay with one of the leading names in the industry (for more reputable brokers you can visit Binary-Options-Brokers.com).
- Don't get impressed by bonus offers. While a nice bonus is always welcome, this should not be the main criteria when choosing a broker. Better a smaller bonus (or no bonus at all) at a reliable broker than a huge bonus at a shady company.
- You can always try more platforms before sticking with the one you like most. If you are serious about investing with digital options, one of the best ways to find the best broker for you is to open accounts at more platforms and make some trades with each of them. Your own experience with the broker cannot be replaced by anything. Testing their platforms with real trades, making a deposit and a withdrawal or contacting the customer support will help you make a better idea about the broker. Testing a few brokers will familiarize you better with the trading environment, and you will end up trading the bigger amounts with the broker you feel most comfortable with.
- Check the minimum requirements in terms of deposits and trade size if you are on a low budget, or the maximum trades allowed if you are a high roller. If you want to deposit using special methods like Moneybookers, Western Union, Alertpay, Liberty Reserve or Money Gram, you should look for the brokers who accept those methods. On the other side, if you plan to deposit by bank transfer or using a credit card you don't have to worry about accessibility, because all brokers will accept those methods.
- Check the payouts and the "out of the money" reimbursements for the assets you are most likely to trade. You may notice that some brokers will offer better payouts on some assets than others.
Who regulates binary options brokers?
Right now there are only two governmental agencies that regulate binary options trading: the Cyprus Securities and Exchange Commission and the International Financial Services Commission from Belize.
Most brokers that target the European market are registered with CYSEC in Cyprus. We believe in the future there will be more jurisdictions to regulate binary options trading.
Regulated brokers cannot accept traders from the United States because the US does not have legislation in place to regulate binaries. This is why the jurisdictions who decided to regulate binary options have excluded US customers as a precaution. This means that brokers who accept US customers are unregulated. This doesn't mean they are not good brokers.
Regulated brokers will usually have additional requirements from their traders, such as verification of identity and address. They may ask for documents in order to make sure the person who signs up is actually the owner of the account. Such requirements are for the protection of the clients and are imposed by the regulator authority. You will find similar requirements from all regulated brokers, including forex, CFD or stock brokers.
Some people consider regulation to offer an additional layer of protection for traders because brokers are required to keep client funds in segregated accounts and are forced to mantain minimum capital requirements in accordance with MIFID (Markets in Financial Instruments Directive 2004/39/EC) regulations in the European Union.
As a general rule, we believe that older brokers with more experience and a good reputation obtained over the years will always be the best choice, regardless of regulation. However, most of the time you will notice that the brokers with the best reputation were the first to get regulated.