The popularity of binary options trading has grown exponentially in the recent few years. The fact that binary options trading is very simple and straightforward has attracted many traders. Big and instant payouts have added to the popularity of binary options trading.
With an exponential increment in the number of binary options traders, there has been a proportionate increment in the number of binary options brokers as well. A binary options broker is basically a company which allows traders to trade binary options through its online trading platform.
Before choosing a broker you need to know how to check if a broker is legit and honest.
Fake Binary Options Brokers
The rising number of binary options brokers has increased the competition. It has propelled them to add more features and become better. However, some fraudulent companies also see this as an opportunity to steal money from unsuspecting traders. Therefore you need to be very cautious while selecting a binary options broker.
LegitBroker.com helps you to choose the perfect legit and reliable broker for you.
If you deposit your money to a fake broker, it will ask you to keep depositing more and more by citing various reasons. The reasons may include higher sign-up bonus, upgraded membership plan, higher payouts etc. The broker will never allow you to make a withdrawal and all your hard earned money will eventually sink.
An unsuspecting trader can end up losing a lot of money. Hence, you need to make sure that the binary options broker you are selecting is legit and honest. But how can one find out if a broker is trustworthy or not?
You need not to worry as the following points will make things clear to you. It may take a while to evaluate your binary options broker on the following points, but once you have tested it on the following parameters, you can be sure of its authenticity.
If you are a beginner, you might need to read about Best Binary Options Brokers for Beginners
How To Check If a Broker is Trustworthy
- Regulation: The first thing that you should look for is the affiliation of the broker. You should find out which regulating body has given license to the broker and validate it using the registration number of the broker. The regulatory information is generally listed on homepage, About Us or FAQ section.If a broker is legitimately regulated by a regulated body (like CySEC), you can always make a formal complaint against the broker in case you feel that you are being cheated and your broker is trying to steal your money. After this, the regulating body will look into the issue. If the broker is at fault, your money will be returned to you with compensation as applicable. The broker would also face the heat of the regulating body in terms of monetary penalty or time ban depending on the severity of the issue.However, if the broker is not regulated by any regulating body all you can do is to hope that it plays fair. You can’t make a complaint anywhere if it is not regulated. Always make sure that your broker is regulated.
- Lack of necessary information: If a broker has not listed information about its company and address, this may be an indication that it is not a trustworthy broker. Legit binary brokers mention their company name and how to reach them very clearly.
- Year of establishment: Check the year in which the broker started its operations. If the broker is new, you should proceed cautiously. When a scam broker comes into the market, it takes a little time for the trading community to figure out it is a scam. Once the word spreads, the scam broker stops getting new clients and eventually shuts down. If a broker has been in operation for a few years, it is a sign that the broker is legit and you can trust it with your money.
- Financial Forums: There are various financial threads where the traders participate in discussions. The traders share their experience and tell vital points about their binary option broker. Such information is rare and not readily available anywhere else on the internet.
Keep in mind that every broker will have a few dissatisfied customers who would talk ill about their broker. Do not get swayed away by a single story of bad experience.Make an informed decision by going through various reviews and comments. Feel free to use the information available on not just one but multiple financial forums. This process may take some time. However, you should pay proper attention while carrying it out because it is one-time process which safeguards you against scam binary options brokers.
- com has reviewed and selected the most important and legit brokers. These reviews are very detailed and include important information about trading platform, trading amount, transaction options etc. A rating is given to the brokers based on these specifications.
Following are some of the warning signs which say that the broker in consideration is a scam:
- Not regulated by any regulating authority
- Recently established
- Poor user experience stories on financial threads
- Poor rating by binary options broker reviewers
- Unrealistic offers like a huge sign-up bonus, extraordinary high return promise
- Poorly defined terms and conditions
- Website content copied form another binary options broker
- Poorly informed customer care executives
- Badly designed website and trading platform
- The broker is continually asking you to deposit more money
Bottom Line About Choosing a Legit Broker
Getting your hard-earned money stuck with a fraud binary options broker is a terrible thing. You should carry out a proper research using the points mentioned in this article to make sure that your broker is legit, trustworthy and honest. Once you have done that you can focus solely on executing trades and earning a profit. Otherwise, you may end up worrying if you will ever be able to make a withdrawal. In such a mental state it is difficult to focus on trading.
Checking the authenticity of a binary options broker is the stepping stone to a rewarding trading career. Make sure you take an informed decision.
Choose carefully, do your research on Legit Brokers before registering to a broker!