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Welcome to USBinaryOptions.com
From 2013, we compare and provide professional reviews on all binary trading platforms in order to help you choose the broker that suits you best.
Check out our top Binary options brokers comparison table to find a trusted platform, and also our platform blacklist with scam brokers to avoid.
Read our guide about binary options trading for beginners as well as few basic binary strategies that you should take into consideration.
What are Binary Options?
These are a new kind of investment. What you will do is speculate on which way you think the asset will go in, or the direction it will go in. What you used to do was you have to purchase the asset now that no longer has to happen. When the platform is used to purchase a binary option the contract that is made enables the buyer to buy an asset which is underlying and at a price that is fixed and with a time frame that is fixed and specified with the seller.
Are there other Names for Binaries?
All or nothing options are also another name for binaries and are digital options + Fixed Return Options or FRO’s. Each of their names stresses the nature of the binary option. When it comes to outcomes there is always two possible results and this is something that the investor will be aware of before they purchase the option. The following is an example:
- Binary option for Microsoft is purchased at $100
- At the end of the day, their shares will be much higher than they were when purchased
- So 71% is the return offered on this investment
Binary Option
This is a particular category of option where a person would be able to get either all or nothing when there comes to talk about the payout. This thing makes binary options easier a lot to know as well as makes the trading process with them trouble free than the previous traditional options.
Expiration
These options are like this;
- They can only be traded until they expire
- Once these are expired, they would surely be settled for the customer in already specified amount (in dollars)
- If the trade expires and it is out of the money then this means that the buyer gets nothing
So now you can see why binary options can either enable you to gain which is the upside or you end up with a loss which is the downside, there is always a risk when it comes to binary option trading. If you were trading in the traditional way then things would be different.
All or Nothing
When it comes down to the platform you are using for trading.
- Nothing can mean something
- Even it happens; at the time of expiration, the proprietor of the particular option could be given a payout yet when there is no money in their hands.
Binary options can also be found under other names including:
- FOREX
- Exchange Market
- Digital Options
Other things to Learn
Before you decide to start trading there are a few things that you should research first including:
- Learn the outcome options
- Decide your position
- Learn how the price is determined
- Learn the advantages of binary and traditional options
- Learn where binary options are traded
- Check the implicit transaction costs of binary options
Are Binary Brokers legal in the US?
Regarding regulation for the offshore binary options brokers, we can affirm that some binary options brokers are already regulated in the European Union ( CySEC ), but not yet in United States.
Since 2006 US binary options have been in America, but they have only just started to become popular since the middle of 2008. This has happened; traders and brokers have started popping up from many states all over the US, what has happened is that people are now wanting to start a career in binary options trading and the one thing that is on every one lip is:
Now when it comes to binary options are divided into two levels and these are:
- US regulated exchange platforms by CFTC, where Americans can trade binary options legally: NADEX and CANTOR EXCHANGE.
- Offshore brokers not regulated.
The Ruling
The OCC or the Options Clearing Corporation in 2007 ruled that binary platforms would become legal then in 2008 the SEC or the Securities and Exchange Commission approved binary options and listed them as cash or nothing security. Then the American Stock Exchange or Amex and the Chicago Board Operations or the CBOE also listed binary options with exactly the same name. Then NADEX or the North American Derivatives Exchange added to its trading platforms binary options. But one thing has been done and that is a restriction has been imposed:
- Americans are free to trade with binary options as long as the broker they are using is legitimate
- The broker has to have a legal business in the county it is in and has to have followed and processed the procedures for it to operate
- Also, they must not have been banned by the federal government for transacting with US citizens in this business
Regulation In The United States
Now just because something is legal it does not mean that it is regulated.
- Legal means that it is protected
- Regulated means that it is not protected
Well US binary options brokers are regulated and over the years binary regulations are becoming more and more stringent. It is the OCC that has made a point of making these regulations harder and also making sure that binary option sold by brokers have the right securities. Rules regarding trading have now been put in place and traders and brokers are expected to abide by them, if they don’t and they violate the rules then either or both trader or broker can end up being banned for long periods of time.
Limits
These have also been set for things such as indices and how many can be listed, this gives better control to the trading that is going on in the market. Scams have also started to rear their ugly heads when it comes to USA binary option trading too. Some of these scams have been very malicious and ended up causing some traders to lose thousands of dollars. But because of the SEC and the US Department of Justice have taken legal action very quickly against the crooks by doing things such as:
- Freezing their bank accounts
- Putting them behind bars
The traders that were scammed were able to get some of their deposits even though it is not the entire amount back, the federal government has been able to enforce justice when it is needed and making broker who was involved in the scams accountable for what they did wrong. This is now why there has been a hard-core regulation within the United States and they will keep on doing so until the binary options market is strong and reliable in America.
He has been a professional trader for over 5 years.
Currently, he works as forex analyst for different investment companies, and also the main author at USBinaryOptions.com
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