Investors wanting to trade with binary options first need a trading account with a broker that is specialized in these instruments. A few of these brokers then allow trading with a demo account which you do not yet have to pay your own money on. Those who want to enter the “real” trade pay the desired amount onto their account and then, start trading.
Meanwhile, there are several different brokers on the market. Although it is still a very young market- binary options have not been traded before 2008 -you find several different providers when searching in the Internet nowadays.
The individual brokers attract new customers, for example, with high possible returns or a great offer of underlying assets, but also with beneficial deposit- and payout conditions.
Assets should be on an escrow account
As an investor, you should first consider that trading with binary options-similar to forex-trading for example- is very international. Most of the brokers are not based in Germany, even if they operate an own German-speaking website. However, this does not mean that you need to be worried about your money. Instead, the fact that many brokers operating in Europe are based in Cyprus can be traced back to fiscal reasons. Apart from that, the local financial supervision even passed the first policies for the regulation.
In order to get a licence in Cyprus, a broker must, for example, prove that all of the investors’ assets are managed on a special escrow account. This means that the broker- even when becoming insolvent-is able to pay out the still available assets to the investors so that they are not concerned by the financial difficulties of the provider. As a trader, you should attach great importance to this guarantee.
Payout does not always cost fees
Deposits and payouts usually can be done in various ways.
Which one a certain broker actually offers, differs, but most of the times, there are at least three different deposit methods.
The individual conditions as well- especially for payouts- differ from provider to provider.
So, the “best” broker is especially depending on the trader’s individual preferences.
Some traders, for example, prefer making deposits via credit card while others prefer electronic means of payment such as Skrill or even a bank transfer. However, your assets are only being refunded immediately in case you pay via credit card or Internet provider.
For paying out the achieved profits, also various rules apply with the different brokers. Usually, only payouts up to the amount of the original deposits onto your credit card are possible, while profits need to be paid out onto a bank account. However, there certainly are great differences with the duration of processing of payout requests as well as the costs.
Some providers, for example, give all customers the opportunity to at least make a free payout once per month. With other brokers, already the first payout costs a certain fee, free transactions are merely possible for VIP clients with a high trading-volume. There are also great differences concerning the duration which is necessary for the processing of payouts. With some binary options brokers, you already have your money on your account after a few days, whereas with others, you need to wait two or three weeks sometimes.