Best Binary Option Brokers For Beginner Traders
You are a beginner who has probably had no experience with the binary options market. You have some money, but do not know where to start from. You have been told you need to get a broker to start trading binary options. You go online and find out that there are literally thousands of brokers on the internet. Where do you start from?
The description below is to aid you find a good binary options broker for beginners. As a beginner, there is a lot to learn from the market. So your very first venture into binary options should be seen as a learning experience, rather than a money-making experience.
When you consider that close to 95% of retail traders fail in their first experience, then you will realize just how important this is. Failures in binary options are usually as a result of using wrong approaches and just not getting things right from the get-go. It could also be as a result of lack of the proper information: information about brokers and what is required of a broker to support you as a beginner in the business.
Here are some facts about binary options brokers.
The binary options market is unleveraged. This could be a plus or a minus. The plus here, is that any losses made is limited to what you have committed to a trade. This is unlike forex or other markets where excessive slippage can cause losses to take out your entire account. The minus here, is that you will have to come up with all the money required for a trade. No broker will give you leveraged funds in this market s do not bother trying to look for any.
The trading platforms used in the binary options market are exclusively web-based. You will not download any software to your desktop. However, it is possible that a broker will have a mobile or tablet app. As a beginner, you should go for a broker that also offers apps, so you learn how trading on-the-go works.
The binary options market affords beginners low entry capital for trading. Therefore, you should look for a broker that allows you to open accounts with as low as $100 or $200. The caveat here is that the broker must allow trades as low as $5. Remember that as a beginner, you are in a form of “internship” so one of the things you would be learning is risk management. You will be starting with low capital, so you need to choose a broker that offers a commensurate investment amount that allows reflects the low capital outlay.
Broker’s Role in the Life of a Binary Options Beginner
As a beginner, you should be able to get a number of benefits from your broker. So when choosing a broker, remember the following facts:
You can only get access to the binary options market by opening an account with a broker that provides the points already listed above. Such a broker must be licensed to offer binary options within a jurisdiction. Some examples of countries with regulated binary options are:
- Cyprus – Cyprus Securities and Exchange Commission or CySEC
- US – Commodities and Futures Trading Commission or CFTC
- Japan – Financial Futures Association of Japan or FFAJ
- Malta – Maltese Financial Services Authority or MFSA
- Australia – Australian Securities and Investment Commission or ASIC
- United Kingdom – the Gambling Commission (transiting to the Financial Conduct Authority)
You need a broker that permits trading in several currencies. This is because it is easier to get certain currencies than others in certain countries.
You need a quick method of transacting on your account. You should be able to deposit funds and withdraw them within 1 day.
You need access to market moving information. You may not get this from a binary options broker, but you can make do with an MT4 platform that has access to a news server.
You need to undertake some courses as you go along. Some binary options brokers have wonderful educational content that comes in the form of videos, articles and other formats.
You need access to charting information. Binary options brokers generally do not provide charts with enough information for technical analysis, so you can make do with any good MT4 platform.
If you can, get access to a broker with a blog where you can interact with other traders. Some brokers now have social media platforms to enable such interaction.
Choose a binary options broker with a demo account. Most binary options brokers will ask you to fund a live account first before giving you access to a demo account. So once you have funded your live account, request for your demo account details. It is your right.