postheadericon Preference over the Binary Options: Your Take

Bet on binary options? Preferably, not! Open an account with an unknown binary options provider? Even less! Investors sometimes think they can easily make money with binary options. Wrong. Many online binary options trading platforms are used by crooks that not only act without the required approvals, but hijack invested funds. Binary options are also extremely risky financial products. The investor runs the risk of losing the entire stake.

This is why the marketing of binary options is now prohibited in some countries.

What are binary options?

In recent times, more and more investors are being offered, most of the time by unknown foreign companies, to invest money speculating on the evolution, in the next minutes, hours or days, of the price of an asset, for example:

  • a foreign currency (US dollar, British pound, Japanese yen)
  • a raw material (gold, silver, oil)
  • A stock market index (Bel20, Eurostoxx50).

If their forecast is realized, the investors recover in principle their stake and receive a nice bonus profit. But if their prediction is not realized, they lose all of their investment. It is therefore an

“All or nothing” contract, called “binary option”, which has many similarities with a game of chance.

Binary options, an example

Take the example of a binary option associated with gold, whose price is for example 1,140 US dollars, an ounce. The investor hopes for a raise and buys a binary option. The option costs 100 euros and the issuer promises to pay 70 euros if the price of gold exceeds 1,140 US dollars an ounce an hour later.

What are the risks of binary options for the investor?

First and foremost, you should know that many binary options trading platforms are used by crooks that not only act without the required approvals, but divert the funds invested. In these cases, the investors never recover the funds and their refund request remains unfulfilled.

If you invest in binary options, you run the risk of losing your entire bet. The risk of loss is greater than the chances of winning: the potential gains are generally limited to 70% of the amount invested. On the other hand, you risk losing the entire amount invested. From will be having the best support in this.

An investor cannot usually control whether the change in price between the beginning and the end of the period is calculated correctly.

The contract between the investor and the supplier is usually very unbalanced or even abusive. As a result, it is difficult to claim the money on the investment account. So you see your money, but you cannot touch it! Some aggressive or unsuitable sales techniques used in the marketing of such risky derivative financial instruments are now also prohibited.

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