Binary options can be a fun way of topping up incomes, or even of providing an income for those savvy enough to learn all about them, and their pitfalls. They are, however, like all methods of playing the stock market, a gamble and open to frauds and scams. A little foresight can help you make the most out of binary options, have some fun and make money, without falling foul of a binary options trading scam.
What are the binary options trading scams to look out for?
Unregulated binary options brokers are most likely to operate scams. If someone offers you a quick return, but they don’t belong to a regulated body, then you should immediately be suspicious. If these binary options brokers offer bonuses that look great on paper, delve into the small print to see if warning bells sound.
A common scam is to promise you a big joining bonus, but then to demand a turnover of two to three times your deposit before your bonus can be accessed. So, for every £100 you felt safe trading, you take a risk of up to £300, with no guaranteed returns.
Another common scam is for binary options brokers to manipulate their Terms and Conditions. After, hopefully, reading the small print, and ticking that you agree with these Terms and Conditions, you find that they’ve become a little slippery, with trading conditions that change at any time, even retrospectively.
A further scam is to keep the trading clock running, but hidden. When a trade closes, the clock should stop and you should know instantly if you’ve made a win, or suffered a loss. Some unscrupulous binary options brokers, however, keep clocks ticking hidden from view, or their platforms suddenly develop a problem, during which time the market moves just enough for your deposited money to be lost.
How to avoid becoming trapped in a binary options trading scam?
The surest way of keeping your money safe is to only use trustworthy and regulated binary options brokers. Ask for personal recommendations, research thoroughly, or test the waters by using a small amount of money that you can afford to lose.
Make sure your binary option broker operates within a regulatory system, so if something does go wrong, you have some hope of getting your money back. At best unregulated brokers might be slow releasing funds, have poorly functioning platforms, and non-existent customer service, or at worse you totally lose your money.
Regulated binary options brokers should have segregated client accounts, give access to up-to-date market data, and offer personalized assistance at the end of a phone.
Do some research, looking out for any negative feedback, or reported scams. Always try before you buy! Play around with a small amount to see if their platform stands up.
Use investment forums, which share knowledge and concerns, you’ll quickly reap this time investment in financial rewards. Never forget that successful scammers keep on top of their game! Use your research and knowledge to stay on top of their frauds and tricks, and your money will be working safely for you.