As with other investment opportunities that are relatively new, binary options are frequently questioned as being a money scam. However, the truth is that binary options themselves are not a scam, but there are some broker platforms that have taken up business that are. For this reason many investors want to verify whether or not a system is a scam before spending their money. While trading platforms like OptionBit, OptionFair, and BDSwiss are reputable brokers, others are not. So, it’s important to keep the following things in mind while making your decision.
Theories behind Binary Options Scams
It’s no secret that many people who trade binary options lose their entire investment. The reason for this is that trading binary options is a high risk business, as it’s nothing more than a financial derivative that has the potential of earning huge returns. Most people who know anything about investing understand that when yields that high are obtainable, it never comes with a small amount of risk.
Knowing this is important because when brokers try to tell you that the investments are sure profit that’s risk-free you’ll know this isn’t true. With that being said, never go into binary options trading with the thought that you can earn revenues of 80% within the first 15 minutes. If broker platforms were constantly issuing payouts like that they wouldn’t be in business very long, as that investment is unsustainable by brokers.
What binary options brokers offer you is a legitimate opportunity to earn a substantial amount of income each month. This is statistically possible because the brokers understand that traders will lose more money than they win. Every trader needs to be fully aware of the risk and do everything he or she can to minimize it.
Hence, the theory surrounding binary options being scams results from two reasons:
- Trading platforms selling investors the idea that the trading is risk-free and sure profit.
- Large amounts of frustrated traders telling their stories of losing big on binary options trading.
Trading Success vs Trading Scams
For this reason, you need to ensure that you choose the broker that fully explains the risks involved. Banc de Binary, for example was rated one of the top brokerage platforms for 2013 because they are professional and offer investors many tools to help them transform into skilled traders. Features such as this are highly important because there should be a series of video tutorials that will explain everything a binary options trader need to know.
In the end, the only scams investors need to watch for in the binary options industry are in the form of trading platforms. So long as the brokers that promise risk-free investments and sure profit are avoided, there are lots of reputable option traders ready to help!