Making a decent living or even amassing wealth from binary option is possible. Many people trading binary options are finding it profitable and so can you. But before we get to how profitable the venture is, we have to address binary options scams.
A lot of unsuspecting traders are losing their investments to binary options scams. The types of binary options scams, how to avoid them, how to get a trustworthy binary options broker are some of the topics we are going to discuss. And since binary options is all about timing, we are going to show you how to get a reliable and trustworthy broker.
To get away with your investments, rouge binary options brokers will either do one of the following:
1. Keep your money
2. Steal your identity
3. Manipulate the trading platform you are using
How do binary options scams work?
Keeping your money– Even though these types of rogue brokers are rare, they still exist. These brokers deny a trader from accessing his/her funds by declining a withdrawal request. A trader is then told that the withdrawal failure is a result of technicality. In some instances, no communication is made to the trader regarding the declined withdrawal. To avoid this scam, make sure that your broker is subject to regulatory oversight by a reputable body.
Steal your Identity– During the registration process at a brokerage firm, traders have to verify their identity; submitting an identification document and proof of address. Rogue brokers can use this information to steal your identity. To protect yourself from this scam, ensure that your broker’s business is subject to government regulation.
Manipulating the trading platform– are you doing everything right and by the books but still do not break even? Chances are, your broker is manipulating the trading platform to make it impossible for you to profit. They do this through;
1. Manipulating the price you get
2. Manipulating the platform itself
3. Charging traders hidden fees
Traders can evade this by registering at binary options traders whose services are under the regulation of the European Union or the United States.
Are All Binary Options Scams?
From the onset, binary options trading has been and will continue to be a legitimate business. Despite the challenges that rouge brokers pose in the industry through scamming, binary option can and will work for traders who smartly put in work.
A large percentage of binary options brokers adhere to government regulation and free-market competition. Additionally, there are independent firms that audit broker’s services to determine whether or not they are legitimate.
How Can I Find a Legitimate Broker?
Government legislation protects a trader’s interests. With this in mind, only opt in for the services of a broker whose services are under government regulation (EU or the US)
How do you find a trustworthy broker in the United States?
The stringent laws governing the United States option’s market makes it hard for EU trustworthy options providers from accessing the American market. Nonetheless, there is a solution. Nadex is currently the only binary options broker that legally has access to the American market. We use “legally” because they are the only option brokerage firm that has been licensed by CFTC.