On the Internet you will find a lot of heated debates dedicated to binary options as a type of earnings . Many people are interested in the question of whether it is possible to make money on options, or whether binary options are a scam that can be compared to slot machines, lotteries, bets on sporting events and similar “profitable” investments.
Experts have different opinions, and they give many arguments both for and against trading on the stock exchange. To finally “dot the i’s” in this matter, let’s look at the problem from different points of view and find out – is binary options trading a scam or true? Or is most of the talk about suckers and scams created by those who simply could not make money on binary options?
Binary options - a scam for suckers?
There are various reasons why binary options are considered a scam, but they are not always based on any assumptions. Of course, the most common opinion is that trading binary options is a scam, since it works on the principle of a casino, but often some “traders” call binary options a scam, since they were unable to make money this way and have lost their money more than once. But in most cases this happens due to the fault of the people themselves. Still, let's look at each of the reasons in order.
Binary options – casino
Some people compare binary options trading to playing roulette or slot machines. Few people have been to a classic casino, because in Russia they are located in separate zones intended for conducting this type of business, but most people have an idea of what an online casino is.
The occurrence of a specific number and color match is unlikely to be completely random, since the owners of such “offices” do not intend to be too generous towards clients. Hundreds of articles have been written about ways to lure money out of online casinos through “spins” and built-in algorithms, so we don’t even recommend considering them as a real alternative to a part-time job, since most of them are a scam for suckers.
Binary options brokers do not set quotes for trading assets themselves; they are dictated only by the market. By receiving ready-made data, there is no way to “correct” fluctuations in your favor. But at the same time, it is not at all surprising that some may consider binary options trading a scam, since most newcomers, coming to this market, do not even have basic knowledge of how exchanges work and how trading is conducted on world markets.
Professional traders who already have experience in trading and are focused on a specific result know how to double-check the price of a currency pair or commodity on other resources. Many people record information in their diary for later analysis. They will definitely notice any manipulations, which can ultimately lead to heated discussion (in a negative light) of such companies on the Internet, as a result of which it is easy to lose a license, and, most importantly, regular customers. Therefore, if some brokers are a scam, then the deceived clients will immediately begin to talk about this wherever possible, and the company will earn the status of a fraudster and a scam. Another argument in favor of the reliability of many brokers is the lack of restrictions for successful investors. Reputable brokers are ready to transfer profits constantly if the trader trades in profit. Bookmakers or casino owners try to prevent this from happening.
There is considerable competition between serious brokerage houses; they are forced to improve their service and develop their platforms for trading binary options . The more grateful clients, the better for the company, and this is an important criterion, since there is no point in large brokers cheating suckers on binary options. It is beneficial for companies to have more users, providing an impressive turnover of money. Thanks to the influx of investors, they can offer better conditions and an acceptable profit percentage per option, which can reach 90% and sometimes higher. But it is worth paying attention to the frequency of such high percentages on options, since if a company offers absolutely everyone to receive at least 95% from one transaction constantly, then such a broker should be suspected of a scam.
Neglecting risks
Beginners come to trading with only one thought - to earn as much as possible and as quickly as possible. And this is one of the reasons for losses during trading, after which many people have the opinion that binary options are a scam for suckers.
It’s really possible to make money quickly on binary options if you use turbo options ( expiration time from 30 to 60 seconds), and therefore this type of options causes a lot of complaints and complaints about fraudulent spins, strange price jumps and scams, but it’s worth considering that when trading, it all depends on the character of the trader and trading style. Anyone who prefers to take too much risk, without using the rules of money management and risk management , using the Martingale system , without really understanding it, will definitely lose the deposit . And as you know, beginners do not know anything about the risks and psychology of trading , and even if they do, they do not adhere to these rules and therefore lose even the largest deposits in the shortest possible time, for which they end up blaming not themselves, but the brokers who supposedly “ they put a spoke in their wheels.”
Only a sober approach and strict discipline will allow you to earn an increase on the initially invested funds. Unfortunately, among fans of turbo options, as statistics show, such traders are in the minority. And often trading turbo options raises the question among many: are binary options a scam or not?
Poor preparation
Also a very common problem among beginners is poor preparation or its complete absence. Typically, a novice trader switches to a real account after several days of trading on a demo account, where he, having a deposit of $10,000, was able to earn $3,000-5,000 in just a few hours, after which he begins to think that everything is fine on a real account. it will also be simple and fast. Of course, the replenished account is most often “merged” and the trader begins to think that binary options are a scam for suckers, since they managed to make money on a demo account, but not on a real one.
For trading to be profitable, it is necessary to spend a lot of time on demo trading, during which various approaches will be studied and tested. To speed up the learning process and not be a sucker in binary options, you need to pay attention to:
- Basic training. Basic training will allow you to learn the basics of binary options trading, and you can do this either independently or with the help of your broker, who most likely provides training information;
- Study of trading platforms. In addition to choosing a trading platform, you will need to study the MetaTrader 4 terminal and the TradingView trading platform , and also do not forget about the live chart for binary options , which allows you to use indicators and strategies without unnecessary terminals.
- Trading techniques and approaches. There are many methods for trading binary options , and they include both trading indicators and pure chart trading using candlestick analysis and other similar methods;
- Creating your own strategy. After studying existing approaches, you should decide on your trading style and create a binary options strategy based on indicators or any other method.
- Risks and capital management. This has already been mentioned above and it is very important to always observe risks and not use more than 5% of the deposit in one transaction.
If you plan to receive a stable income from trading, then training and gaining experience is a must, since trading is no different from any other profession in which you cannot become a professional without studying it thoroughly. As soon as you can receive a constant income from binary options, you will immediately be able to answer the question - binary options are a scam or true.
Black binary options brokers
In order not to lose the desire to trade binary options right from the start, considering them a scam, it is important to register with a decent broker, of which there are many, but there are also many fraudulent brokers who are ready to do anything to get the money of their clients (suckers). Some companies, in addition to providing exchange access services, sell “revolutionary” strategies or offer paid training from “experts”. An overly persistent offer of such “products” should prompt the idea of changing a broker. And to begin with, it is always better to choose free binary options trading training .
Fraudulent brokers of binary options can deceive suckers using other methods, including blocking accounts and non-payment of profits, as well as by fraud with bonuses.
You should be wary of all kinds of generous bonuses on top of your deposit . The “trap” may be hidden in the conditions of receipt, written in small print at the bottom of the page. Often, in order to get your money back, you will be required to provide a considerable volume of transactions, sometimes exceeding the accrued amount of the “gift” by a thousand times. The trader begins to get nervous, trying to quickly fulfill the broker’s conditions, and loses his deposit.
To avoid disappointment, always study the terms of the services or bonuses offered to you, especially if they are actively advertised.
Prominent representatives of fraudulent brokers and those brokers who are, even if not black, but at least “gray” can be considered brokers:
- BinTradeClub ;
- Logatomtrade ;
- KingTrade Pro ;
- StarsBinary .
But please note that these are not all scammers and there are dozens, or even hundreds of times more of them.
For example, the broker BinTradeClub previously had on its website:
- A huge number of errors;
- A user agreement copied from other resources that has nothing to do with reality;
- Links to “leftist” profiles on social networks such as Instagram;
- A very inconvenient and poorly functioning trading web terminal.
Needless to say, if he can pay small amounts up to $100, large amounts are definitely out of the question.
The Logatomtrade broker is popular because it generates positive reviews about itself and assigns itself awards, which of course this company has never received, but the main problem of this so-called broker is that the trading platform that is posted on their website exists only for show and you cannot trade on it. And before you fund your trading account, you see how the quotes move, there are buttons for trading, you can see the chart, but as soon as you fund your account, trading will become impossible:
The KingTrade Pro broker looks like a regular broker, but at the same time offers traders profitability on options exceeding 100%, which no binary options broker can afford, since in this case the company will not be able to hedge its risks. In addition, the broker charges a commission for servicing the trading account, and also in order to later withdraw your money, you will need to complete a certain trading turnover, as is usually the case with bonuses. Also, the trading platform of the KingTrade Pro broker is absolutely not suitable for profitable trading, since it only has three indicators, four graphical tools, a maximum time frame of 10 minutes, and you cannot reduce the chart to view the full history:
Broker StarsBinary positions itself as an innovative broker, but at the same time it has a very weak website with almost no information about anything. Also, the links on the site were previously not provided by “leftist” resources. Like the previous broker, this company has a very weak trading platform, which is not suitable for comfortable trading, at least because the maximum time frame on it is 1 minute. But the most important problem with the StarsBinary broker is that it simply replaces quotes if necessary:
The law on binary options in the Russian Federation is a scam?
As of today, trading in binary options has no legislative regulation in the Russian Federation, since the State Duma will not adopt the corresponding package of regulations, but it is not worth calling binary options a scam only on this basis.
Most brokerage companies can operate absolutely legally with licenses from European or other independent regulators. It is worth noting that obtaining even such a semi-official license is not so easy and for this, companies have to provide many documents, undergo inspections and pay various expenses.
Who regulates binary options?
Reliable brokerage companies voluntarily obtain licenses from financial regulators, for example, CySEC (Cyprus) or TsROFR (Russian Federation).
CROFR is an organization whose members have agreed to follow the charter and act exclusively transparently. If conflict situations arise, you can contact this regulator, who will understand the cause of the dispute and take action, if, of course, your broker has a license specifically from the Center for Financial Markets.
Also, regulators can pay funds to deceived traders thanks to the insurance fund, which is created at the time the broker obtains a license, and most often the amount of the insurance fund is $20,000.
If you're worried about paying taxes on your binary options trading income, don't be. This type of profit is not specified by any law, so from the point of view of Themis, you are absolutely clean, without transferring anything to the state.
Fraudulent brokers with a license
Another common reason why disputes arise about whether binary options are a scam or not are some companies that were able to initially obtain a license from regulators, but as a result began to violate all their obligations to clients and therefore deceived traders began to consider binary options a deception for suckers, since the lost funds could not be returned.
But you should understand that such cases occur quite rarely and only new and unknown companies can do this, and you should work with them very carefully at the initial stage. Also, all “black” brokers charmingly appear on the regulator’s black list, which will indicate their dishonesty.
Reviews about binary options: scam or reality
We figured out that some complaints about binary options are quite fair, but, for the most part, the causes of losses are the human factor or dishonest brokerage companies. So why can you find so many negative reviews online that binary options are a scam for suckers?
It is worth noting that most of these reviews are written by those who traded very little and almost immediately switched to a real account, where they lost their entire deposit. There are also traders who are losers who didn’t even try to trade on a demo account, but immediately started with a real account, after which they started writing on all forums and review services that binary options are a scam, a scam, a scam, and so on.
To avoid being a sucker in binary options, you need to be prepared, just like in any other area. To become a professional in any field, you need to spend years mastering the necessary skills, and that is why no one tries to immediately get the “highest” position, since even if this happens, a person is unlikely to be able to cope with such work due to lack of experience and knowledge. It’s the same in trading, where you need to know and understand a lot before it can make a profit.
Also, many people very often pay attention to the disadvantages of binary options, but completely forget about the advantages. Let’s try to “rehabilitate” this type of income by considering additional arguments:
- Ease of making a profit. The trader just needs to determine which direction the price will go. A competent strategy, technical analysis, endurance - and you will start receiving income;
- Possible profit. Profit from one transaction can reach up to 90%.
- Psychological relief. The emotional load is several times less than in Forex. There is no point in monitoring an open position in an attempt to earn more. Both the profit margin and the closing time are already fixed.
As you can see, binary options will be a scam for naive traders only if they make beginner mistakes. For professional traders, trading is a very real way to earn income, and you can successfully fight the tricks of brokers if you know most of their tricks and do not fall into the traps they set.
And finally, a few reviews about binary options from real users:
Binary options - a scam or true? Experts' opinion
Experts in the financial world do not consider binary options a scam for suckers, since options were originally created to hedge other financial transactions. Simply put, hedging is a measure to reduce the risks that may arise when investing or speculating on assets.
Binary options may differ from classic stock options, but the essence does not change. However, it is worth noting that far fewer traders trade options on a real exchange, and most prefer classic trading on the exchange. This happens because options are considered a rather difficult financial instrument to trade. That is why, before trading, as mentioned above, it is worth studying a lot of materials and spending time on demo trading.
You can also find out more detailed opinions of experts about binary options from the video of the RBC channel:
Conclusion: BO – a scam for suckers?
Binary options are a good way to invest money, but in order not to lose your deposit on the first day, you must know the basic rules of trading, find out which brokers are better not to deal with, choose a trading strategy and test it on a demo. account. Proper and high-quality preparation, as well as constant training, is the surest way to succeed in binary options trading.
A great way to figure out whether a broker will scam you is through reviews from traders on trustworthy resources. Therefore, before choosing a broker, you should always study all available comments and draw your own conclusions.
Don’t be fooled by too tempting offers, as most likely it’s really a scam, especially if the broker is not licensed. Also pay attention to other factors that may affect trading in the future. Such factors include the operation of the trading platform, trading conditions and the availability of a demo account with the broker.
Regarding the controversial thesis under consideration that binary options are a scam, the opinion of experts was formed a long time ago: options are not a scam, but a reliable way of investing.
See also:
What novice traders need to know about binary options
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