Black White Binary Options Trading
Black vs. White In Binary Options Trading
2017 looks like it is shaping up to be a big year in the world of binary options trading and other investment products such as CFDs—or contracts for difference—with major developments. One of the bigger binary options brokerages announced its imminent closure earlier in the year, with a swarm of problems legal problems to deal with, such as a lawsuit brought in by the United States and a loss of partnership in a British football club. Meanwhile, CFDs are coming under increasing scrutiny by other countries as people begin to more thoroughly evaluate the risks and rewards involved in that unique from of investment.
What does all this mean for binary options trading going forward? One of the great things about this investment product is that it is, itself, a binary form of trade; on or off, right or wrong, black or white. But are things really all that clear cut for binary options trading itself and its future?
A Change In Perception
One of the things that is becoming increasingly clear in the world of binary options trading is that there is some kind of reformation taking place in the ways that binary options brokers present themselves. In the past, one of the most common marketing techniques that binary options brokers used was a very exaggerated, “aspirational” form of promotion that had a lot of resemblance to get-rich-quick schemes. The marketing talk and imagery used for many of these brokers revolved around expensive, exotic cars, dream houses in far-flung destinations, and promises of people becoming affluent millionaires in a very short period of time.
Unfortunately, this compounded the difficulty of separating legitimate binary options brokers from scam operations, that tended to promote themselves in a similar way. The critical difference was that legitimate binary options brokers simply acted as facilitators, letting their clients make their trades, and then depositing money into their account upon the completion of successful trades. Scam operations never had legitimate trades to begin with, so clients who thought they were making trades were simply depositing money with the scammers. In the worst case scenarios, these clients would even be the victim of identity theft, with the scammers getting access to their identity particulars, such as bank account or credit card details, that would then be used to drain accounts.
The Unregulated Problem
A big issue in separating the good from bad, or, again, “black or white” in binary options trading is the question of regulation. While you can be a certified, regulated broker with a license to operate from a recognized financial oversight body, such as America’s SEC, or the United Kingdom’s FCA, you don’t have to be. There have been quite a few reasons for this over the years with regards to binary options trading.
For one thing, the United States took a dim view of binary options trading, and worked with the greater global community of financial law to come to an agreement. While it was not illegal for Americans to trade in binary options, it was made illegal for fully licensed and regulated brokers in other countries to accept Americans as clients for binary options trading.
As a result of wanting to meet the needs of Americans looking for binary options trading opportunities, many newer brokers chose not to become regulated, despite maintaining compliance otherwise with the financial regulations of their country. This allowed them to maintain a good reputation, but still be able to take on American clients. Unfortunately, scam operations also—for obvious reasons—never bother to become regulated either. In the online world, the only thing people really have to go on at face value is a website, and, like business cards, unless people take the time to do good research, going by a superficial glance alone can make a legitimate, but unregulated broker look similar to a scammer.
Of course, even when a binary options broker is regulated, that doesn’t necessarily mean all is well, merely that when something goes wrong, there’s much more legal and financial accountability. The binary options trading broker that has announced its closure this year is regulated, but is dealing with both the legal and financial fallout of lawsuits and operation violations.
Binary options trading itself is a proven financial product, and it works. But the conflicting information about it, and the more high profile negative stories surrounding less legitimate or legal operations has been a controversy and challenge for legitimate operation and trading.
As always, people are encouraged to be patient and deliberate not just with choosing a binary options trading broker, but trading binary options as well. A common complaint that some traders have after the fact is that some brokers will have advisors that can be insistent about making a trade, only to lose that money for the trader when the trader agrees and the trade itself does not work out as hoped. This loss, while unfortunate, is not actually illegal, since the ultimate decision to make a trade still rests with the client. The best way to avoid this is to not give in to the sense of pressure or rush that an advisor may be attempting to push, but there’s nothing illegal about being overly aggressive with financial advice.
Another thing that is likely to change in binary options trading, especially for legitimate operators, is the form of marketing. Going forward, the sales approach of affiliate marketing and the websites of binary options trading brokers themselves are likely to distance themselves from the scammers that will continue to push a get-rich-quick narrative. Real binary options trading is still ultimately an investment or financial product, like stocks, bonds, and even bank accounts. In that sense, binary options trading should be more accurately presented and regarded as a means of supplementing and increasing savings, rather than a new high stakes/low time-demand career that people can quickly jump into and become millionaires.
Wealth and success are, of course, realistically achievable with binary options trading. But, like most disciplines, this requires practice, training, persistence, and a willingness to learn and work hard.
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