Binary Options in Different Countries – What to Look for When Trading Them Since the Internet started to connect more and more people, online retail trading increased in popularity. These days, anyone with an Internet connection can trade the financial market. Forex brokers were the first one to spot the new opportunity in the retail trading market. Binary options ones followed. Because the binary options industry is relatively new (only dates a few years back), there’s lack of regulation in many parts of the world. This allowed dubious companies to start operating as a binary options broker.

However, at the expense of their customers. Inspired from the Forex retail industry, binary options brokers failed to meet the same standards. Binary Options Trading in Different Parts of the World Believe it or not, in some parts of the world binary options trading is illegal. In other parts, trading these financial products is associated with gambling.

Yet, in other regions, financial authorities see the binary options trading activity as being just another financial market. Hence, it must be regulated.

But, regulation comes with a cost. Usually, the costs associated with regulation are quite high. Not only at the beginning, but also on a constant basis. When a binary options broker becomes regulated, it gets a license. However, this one can be suspended if the broker violates the business conduct. Because of the high regulatory costs, many entities try to skip the process.

They set up their businesses off-shore. Then, they target traders in countries where they should be regulated. While this is a gray area of doing business, traders fail to understand that all the risk is upon them. Like being profitable in this business wasn’t hard enough! In binary trading, traders face two headwinds.

Not only they must know the direction the market will go, but also where the price will be at a specific moment in the future. The price an option is bought at (an option can only be bought) is called the striking price. At the expiration date, a call option must have a higher price, while a put option a lower one. That simple is binary trading. Yet, being able to predict both price and time is a lot more difficult than people imagine. On top of it, brokers know that. As such, the industry is advertised as being extremely easy to profit from, and traders are hooked on incredible stories.

Are Binary Options Disappearing? In other words, there’s real evidence that binary options can be rigged against traders.

Add to this a very small minimum amount to start with, and you’re hooked. Choose your country below for more in-depth information.

Perhaps the toughest regulation exists in the United States of America. Both the SEC (Security and Exchange Commission) and CFTC (Commodity Futures Trading Commission’s) provide regulation for binary options brokers. This is in traders’ interest. As such, before opening a trading account with a binary options broker, a U.S.

The list of US brokers is not only based on the fact that these brokers enable US customers to trade binary options, but also on the quality of the services offered. Best binary options demo account. What is important for every trader to know is that binary options trading is legal in the United States of America, despite what the rumors say.

Potential trader must check to see if the broker is regulated. Regulation means that the broker can operate on the United States territory. Moreover, regulation means safety for the client’s deposit. Regulated brokers must keep the deposited funds in segregated accounts with a custodial bank. In other words, they can’t touch them and use the funds to pay other people’s withdrawals or to fund their day-to-day activity.

Unregulated brokers do this. Because of tough regulation, not all binary options brokers pass the regulation conditions. However, the ones that do, enjoy one of the biggest binary markets in the world. Binary options trading is extremely popular in the United States. It has a solid regulatory base and traders know the financial authority will step in once the broker faces liquidity issues. Both federal and state law allow binary options trading.

The most important financial authority in the United Kingdom is the FCA (Financial Conduct Authority). However, while it deals with the Forex and CFD (Contracts for Difference) brokers, it doesn’t regulate binary options brokers. There’s a reason for that. In the United Kingdom, binary options trading is associated with gambling. As such, there’s a special, different authority that deals with it.