Becoming a Winner
Is there a problem with binary options trading? If you’ve been keeping up with the news, you probably would think that there is. There is currently a lot of controversy about this, especially in the light of the reprimands that have come down from the government concerning a few different trading sites. Let’s look at what has happened in the industry and see if this type of trading is right for you.
The main argument is that binary options provide financial instruments, but are not regulated, and therefore not legal within the United States. The problem with this argument is that binaries are not actually providing financial instruments. They look at underlying assets and then provide a return or a loss based upon your prediction of how that underlying asset will act. There is no change in ownership that ever takes place. If you buy a binary call option for a stock, you are not taking a stake within that company. You are merely guessing that the stock will go up in price. In this light, the federal bodies that govern trading–FINRA and the SEC–really have no bearing over binary options. They are not securities at all, but rather a prediction of behavior.
In other words, binaries are dependent upon how regulated assets move, but completely independent of them in all other respects. Still, the U.S. government has cracked down on a few sites, and as a consequence of this, many other brokers have disallowed U.S. based traders to use their platforms. This might make you think of the “bucket shops” that were popular in the post-Great Depression age, but these are not sites run by criminals and gangsters. The vast majority of binary option sites are run and regulated by financial professionals looking to offer you a service that is cheap to use and easy to access. There is an element of risk involved, but this is true within any sort of financial market.
The other problem that has been brought up is that binaries are scams and they need to be outlawed in order to protect gullible traders. The reality, though, is that there are very few scam sites out there. Scams are everywhere, though, not just within the binary options industry. It always makes sense to take care where you put your money. Just as you wouldn’t send money to a “prince” over in the Middle East, you also wouldn’t send your money to a scam site. The difference is that one is easier to spot than the other. Do your research and take care of yourself. There are many more reputable sites than bad ones, but that doesn’t mean you shouldn’t study where you are planning on sending your money and trust them not to vanish with it.
This is not like gambling, which is also regulated in the U.S., since there is definitely an element of skill involved. The UIGEA of 2006 states that gambling on games of chance over the internet is not allowable, but things like fantasy sports are allowed because skill is involved. Binary options more closely resemble a skill than fantasy sports do, and therefore, are not affected by this law.
What it comes down to, though, is that the world is a huge marketplace and it prevents a huge hassle to just forbid U.S. traders from using these products. Many of the big brokers, especially those based out of Europe, now do not allow this population to create accounts. But that doesn’t mean that you cannot create an account elsewhere. There are many places for you to go that will gladly accept your business if you live in the U.S. Still, if you are not comfortable with the purposeful vagueness and selective enforcement of the government’s policies, there are several sites that are completely allowed within the U.S. Finding these will help you to eliminate that issue for yourself and proceed with your trading with a clear mind and no distractions.
The Best Policy
Your best course of action if you wish to trade binaries is to find a site that is safe and you are comfortable with that meets all of your needs. There are tons of stuff to look for in a broker, so make sure you have your bases covered. Find a site that offers the assets you wish to trade, with high rates of return, has the instrument you need to be successful and offers the occasional perks to reward you for your business. If these conditions are met, not only will you greatly reduce your stress levels, you will stand to make more money than ever before. It might take some effort to find the right site, but once you do, you will be able to start moving forward with your trading and advancing your financial independence.