Table of contents:
- 1 Critic: Many customers have already suffered high losses
- 1.1 Why binary options are so popular with beginners
- 1.2 Trust is good, control is better: Find a suitable Binary broker
- 1.3 Binary options addiction – a long underestimated danger
- 1.4 Good risk management is essential
- 1.5 So that binary options do not threaten the existence
- 1.6 Despite precautions: The risk remains
- 1.7 Our conclusion: Binary Options Take criticism seriously
Are you interested in trading Binary Options? – Then you should read my review and learn from my experience with this financial product. With more than 8 years of online trading, I tested a lot of different platforms, strategies, and brokers. On this website, you will find a trusted review of this financial product including criticism. Learn about the risks, advantages, disadvantages.
Critic: Many customers have already suffered high losses
The special structure of Binary Options attracts especially beginners who have little or no experience in trading financial products. This is where the risks are often misjudged and investors quickly lose all their trading capital. Therefore, the Internet is full of Binary Options criticism.
This comes not only from the side of the aggrieved customers but also the consumer centers are now issuing a Binary Options warning. However, the claims of some former traders that Binary Options are fake and therefore no money can be won with them are not true either. There are always fraudsters among online brokers, but Binary Options trading is also possible under serious conditions.
Investors should only be aware of the highly speculative nature of Binary Options. While losses are unlikely with more conservative forms of investment with the right strategies and a total loss almost never occurs, both are commonplace when trading binary options. Therefore, money should really only be invested here if it can be regarded as a kind of “stake” that can be lost with a not inconsiderable probability.
Why Binary Options have much critic:
- Binary Options attracting a lot of beginners who underestimate the risk
- There are scam and fake websites
- Binary Options have a high risk
Why binary options are so popular with beginners
It is now well known that Binary Options can lead to high losses. Not only consumer protectionists try to warn beginners of the dangers of trading with their criticism of Binary Options, but also many customers who have suffered a loss themselves report about it on the Internet.
Nevertheless, new beginners register again and again with the many brokers and pay partly high sums with these. The fact that Binary Options are so popular with beginners is due to their simple structure: Trading can be learned quickly and not many decisions have to be made to place a trade.
This makes Binary Options an ideal way for many users to participate in the financial market without having to spend days or weeks learning how the trading platform works. Most professional traders, on the other hand, prefer the much more complex trading of CFDs or Forex products, as it offers more opportunities and therefore good decisions also have a greater impact on profits.
While there are some successful Binary Options professionals, the majority will switch to other products sooner or later. However, this does not necessarily speak against binary options: Many professionals started their careers here and made quite good money with Binary Options.
I recommend to use a Demo Account for practise trading first.Andre Witzel from Day-Traders.net
Trust is good, control is better: Find a suitable Binary broker
To trade Binary Options, traders need a broker. As the interest in this form of investment has continued to grow in recent years, the number of brokers has automatically increased. Therefore it is not easy to find your way among the many providers. Broker comparisons help here and in our detailed reviews, we take a closer look at the individual providers to help you decide which broker is right for you.
See the list of our trusted Binary Options Brokers:
Serious brokers let official authorities look at the finders and are regulated by them. Not every regulatory authority is equally good. For European traders, for example, it has several advantages if the broker is regulated within the EU. Firstly, the security regulations are particularly strict here, so that EU brokers generally cause problems much less frequently than the much less well-regulated brokers, who are often based in the Caribbean, for example.
On the other hand, the broker is more accessible in case a legal dispute should ever arise. Of course, a broker from your own country is always ideal, but there are very few EU providers of Binary Options. However, most European financial professionals attach great importance to EU regulation. But they also trade with international brokers.
Binary options addiction – a long underestimated danger
The usual Binary Options criticism relates to the high risk of loss and misleading advertising promises. But also the danger of addiction should not be underestimated. Many traders would not think that binary options can be addictive when registering with a broker. After all, this is a financial product and not a slot machine or similar.
Even though the chances of winning with Binary Options can be influenced by good chart analysis and therefore it is not pure gambling, both areas have a lot of similarities with each other and also with binary options a part of the success depends on luck. In addition, there is the special structure: When a trade is won, an amount is credited that is often almost as high as the stake.
Due to the clearly defined end of the trade, one can be eagerly awaiting the expiration of time. If the trade is then actually won, this naturally creates a feeling of happiness, the trader’s body releases the so-called endorphins. The trader naturally wants to experience this feeling of happiness again and again. Thus, just as with the slot machine game, an addiction develops. Therefore, in any case for Binary Options, if an addiction problem already exists or the potential trader is considered to be at risk, hands-off.
Good risk management is essential
Whoever trades with BinaryOptions will always have to bear losses, because trading is very speculative and despite good analysis, prices regularly do not develop as the trader expected. Whoever therefore wants to trade with Binary Options in the long term should have a good financial plan, to which he or she will adhere to discipline
Such a plan includes the maximum percentage of the available balance that can be used simultaneously. Since a lost trade directly means that the entire stake is gone, this must be planned for. A single loss should not affect the capital too much, otherwise it would fluctuate strongly throughout and would be used up at the first negative variance.
Some brokers’ training materials recommend that you never put more than 10% of your total balance on a single trade (Money Management Strategy). This sounds like little, but it is still quite risky considering that several trades are regularly lost in a row. Professional traders, therefore, choose much smaller percentages and adjust them consistently if they have a run of bad luck and their total capital becomes smaller as a result.
- Choose a limited amount of your account balance per trade (%)
- Do not invest too much money into one position
- You have to get through losing streaks without killing your account
So that binary options do not threaten the existence
Binary Options are not suitable for investing hard-earned money that is earmarked for house building, retirement provisions, or purchases in a meaningful way while still generating a profit. With a lot of luck, exactly this can be achieved, but the customers do not have it completely in their own hands. Due to the highly speculative nature of binary options, there is at least as great a risk that the money invested will be lost. As a result, the customer would have to limit himself financially considerably, as he would no longer be able to use his capital as planned.
Avoid the described Binary Options trap and only invest money whose loss is not a problem for you. With many brokers, there are only small or even no minimum deposits. If you would like to try out Binary Options, you should either do so with the smallest possible amount, or with a free demo account. Such a demo account is offered by many brokers and can usually be used for a limited time. Here you can trade with play money for free and without any risk and thus gain experience with Binary Options without having to make a deposit.
Despite precautions: The risk remains
As we have now seen, there are a number of measures that can be taken to make Binary Options trading safer. However, trading remains a highly speculative business that will never be without risk. For investors who, in the worst-case scenario, do not have too much of a problem with losing their entire investment, and who still want to take advantage of their Binary Options opportunity, they can still be a suitable trading option.
For all others: Binary Options Hands off! There are always traders who want to make quick money with Binary Options and ignore the risks, even though they need their capital urgently. These traders often tell themselves that a total loss will not happen to them and dream of making a quick profit. Unfortunately, it is precisely these users who are most often affected by a total loss. One of the reasons for this may be that the pressure not to lose capital means that optimal decisions cannot be made and the trader often acts too emotionally. But even if all precautions have been taken, it can still happen that everything is lost. Professional traders are aware of this risk and have a Plan B up their sleeve.
Our conclusion: Binary Options Take criticism seriously
The critical comments about Binary Options should be taken seriously by both active traders and interested in potential new entrants. It is not a safe investment in which to invest assets needed to maintain a standard of living or for other purposes. There are much better opportunities for this on the financial market.
However, when it is written that Binary Options are fake or rip-off, this is also exaggerated. Although in the past there have always been brokers who actually cheated and made customers lose a lot of money, serious providers are not fraudulent.
Nevertheless, it should be noted that the broker usually makes the biggest profit. The customer gets a financial product where the chances of profit can be increased by a good knowledge of the subject and the corresponding price analysis, but whose profit still depends to a large extent on chance. The trading conditions can be read in the general terms and conditions of serious providers so that no trader has to be ripped off. Professional traders inform themselves in detail beforehand and only register with brokers where they can obtain good conditions.
Trading with Binary Options remains highly speculative and there is always the threat of a high loss, up to a total loss. Only clients who consciously accept this have the chance to become happy with Binary Options in the long run and can trade them successfully.
- Binary Options are risky like any other financial product
- Binary Options are easy to understand
- Do not underestimate the risk
- First, try Binary Options in a demo account
- Make your own research and create a trading strategy
- Good risk management is the key to success
Check out my other articles for Binary Options:
- 15 Rules for Binay Options – Tips & Tricks
- 5 best Binary Options Broker 2020 – Review & Comparison
- Are Binary Options a gamble?
- Are Binary Options a scam?
- Are Binary Options Robots a Scam? – Honest review
- Best Binary Options App – Comparison & Review
- Binary Option Markets
- Binary Options – Call and Put
- Binary Options – Range Options – Boundary Options
- Binary Options – Touch Options
- Binary Options 60 seconds Trading Strategy & Tips
- Binary Options Bollinger Bands Strategy
- Binary Options commodities trading
- Binary Options demo account – Recommended For Beginners
- Binary Options Money Management Strategy
- Binary Options News Trading
- Binary Options regulation – Why is it important?
- Binary Options review – Critic and warning
- Binary Options RSI Strategy
- Binary Options trend following strategy
- Binary Options volatility strategy
- Binary Options vs. CFD Trading – Which one is better?
- Binary Options vs. classic options
- Binary Options vs. Forex Trading – Which one is better?
- Chart analysis for Binary Options
- Forex Trading with Binary Options
- Hedging Binary Options: Can You Hedge Against Losses?
- How risky are binary options?
- How to avoid Binary Options Scam Brokers
- How to trade Binary Options – Trading Tutorial
- How to Trade Stocks with Binary Options – Tutorial
- Is Binary Options Trading safe? – Consumer protection
- Learn to read Binary Options Candle Sticks
- Trade Binary Options with MetaTrader
- Trade Pivot Points with Binary Options
- Warning about Binary Options – A form of betting
- What are Binary Options?
- Why Binary Options Signals are a scam