In the United States, there are many rules and regulations pertaining to the trading of binary options. However, if you want to trade and you are located in the U.S., there are choices available to you. As you will see, just because you have a lot of choices when it comes to your broker—even when you live in the United States—you should still be very careful about which broker you decide to use.
Reliability and Reputation
When you are selecting a broker, the reliability and the reputation of that broker is a key part of your success. Scam sites are rare right now, but they do exist. A broker that is just out to get your money is not something that you want to be a part of. Yes, binary brokers do need to make money to stay going, but this should be because they are offering a strong product to their clientele, not because they are swindling people. When a broker has a good product, it creates the profits that they need to stay open for the long term. A scam site will be new, and it will not last long.
However, you are in a place of responsibility when it comes to your own money. You need to do your own personal research and ensure that the broker that you decide to go with is operating in a legal capacity, is open to people in the country where you live, and has a competitive series of rates of return. This way, you will make sure that the broker you finally decide upon is on the up and up and is going to be helpful to you as a trader.
Binary options trading is risky, and trading with a disreputable broker will only increase that risk needlessly. If you want to have a chance of being a successful trader, you need to go with a strong and reliable broker.
Ease of Access
Ideally, your best binary options broker will be really easy to access. You shouldn’t have issues creating and funding an account, and if you want to withdraw your cash, you should have no problems seeing that money show up in your bank account. Financial transactions naturally need to have a lot of limits placed upon them, and of course you want a broker that will more than comply with the local laws. This should involve very strict security measures to help prevent money laundering and other types of fraud. Despite these safety measures, it is possible for a broker to give you quick access to trading funds, and it is possible for withdrawals back to your bank account to be processed swiftly.
Regulated vs. Unregulated
There are binary options brokers available to traders in the U.S., but most of them are not regulated within the country. Some brokers absolutely prohibit traders from the U.S. to even stay on their website and block all content. Others will gladly accept traders from here even if they are not technically allowed to do so. Money is money, and because it is very difficult for authorities to track this kind of thing and crack down on it.
However, even if a broker is regulated outside of the U.S., this does not mean that it is safe for traders based here to use these sites. Currently, there is only one binary options broker that is legally regulated within the United States: Nadex. While other brokers might be regulated by bodies like CySEC or other organizations, Nadex is the only broker currently offering binary options that is regulated by the Commodity Futures Trading Commission.
There are a lot of brokers for you to choose from, even if you live in a country that has strict regulations about who can offer trading legally within the borders of their land. But just because you can use a broker doesn’t mean that you should use a broker. Do your research and be sure to follow your country’s regulations so that you and your money are protected. In the United States, this means that if you want to trade binary options, you need to create an account with Nadex.
So, you’ve followed all of the local regulations that pertain to you, and you have been very careful to select a proper broker. Great! The next step is to maximize your potential as a trader. At Nadex, trades are executed on a sort of scale. Your goal is to predict whether the price of that asset will go up or down. That’s it. However, you will get a return only if you are correct, and that return will vary based upon the likelihood of that trade coming to fruition over the stated period of time. Take a look at some of the payout rates you can expect from other providers.
For example, let’s say that you believe that the price of the S&P 500 will increase by the end of the day. You will be given a price for an upward trend on a scale of $0 to $100. If you are correct, you will be awarded with a profit of $100 minus whatever the price was that you paid. If you paid $50, then your profit will be $50. The amount that you pay depends on several factors, including the asset’s momentum and how much time is left before expiry.
It is possible to trade much less than $50 in some instances, or much more. Not all trades have the same likelihood of coming to fruition. You may find a trade that costs $1 to enter and will profit $99. Or, you might find a trade that costs $99 to enter and will profit $1. Whatever it is that you risk, that is the maximum that you can lose.
This is different from the European style binary options that most people are familiar with, and as a result, trading at Nadex requires a very different strategy than what you would have used for other sites. If you want to be profitable, a lot of study and time will be needed to better your existing strategy. It’s not like you can trade 60 second binary options the same way. Even then, there is nothing guaranteed with trading. You still might lose money. By being cautious, selecting the best broker for your needs, and having a strong trading strategy and risk management system, you can minimize your chances of losing money. Nadex helps to ensure that you are protected when you trade by allowing traders to end trades early at either a partial loss or a partial profit, depending on where their trades stands at the time that it is closed. This isn’t something you will want to use often, but it can be a helpful way to hedge positions.
Trading binary options in the U.S. is possible, but there are very strict laws that need to be followed, both by traders and by the brokers that offer them services. Currently, the only broker that provides this service in the USA is Nadex. They are one of the most strictly regulated brokers in the world, and they still have a wide variety of trades and assets available on their site, all with competitive rates of return. If you live in the United States, you should read our Nadex review. It is the only site that you should consider trading binary options with.