At the peak of its popularity, binary options were a welcome respite for novice and experienced traders in the aftermath of the 2008 global financial crisis. In many countries, binary options still remains a very popular method of investing in the financial markets.
How To Find an Authorized Binary Options Broker
However, some brokers who engaged in unethical financial practices almost created a bad rap for binary trading. Regulatory bodies such as the Financial Conduct Authority in UK and other agencies in other countries came out strongly to create policies that would protect the trader.
How does regulation help?
In UK, FSA has put in place measures to prevent unregulated brokers from marketing binary options as an investment tools. This does not mean that binary trading is illegal or that you cannot find a regulated, licensed broker.
Regulatory bodies that are in charge of overseeing binary options brokers help to protect traders from theft, unfair trading and against losses in the event that a broker is bankrupt. How do they do this? Brokers are required to implement stringent requirements to protect the trader from any of these eventualities.
How do you know a broker is authorized?
Before opening a trading account, it is your responsibility as a trader to research and find out whether the broker is known to the authorities. For example, in UK, FSA regulates binary trading and all brokers who offer this investment option must be known to this regulatory agency. The same rules are applied also to Cysec brokers.
A broker must have reliable customer support that can attend to your questions any time you need clarification. It is also important to establish that the broker has a strong financial reputation to ensure that they can pay out traders’ withdrawal claims. If you see any indication of a broker that offers deals that are too good to be true, for example, non-deposit bonuses think twice about it.
Generally, financial market brokers, including binary options brokers are required to undergo scrutiny in terms of audits done by the regulatory bodies. These regular audits ensure that brokers are stable and are operating ethically, for example, by separating clients’ account from the broker’s fund. This simply protects traders from issues arising from bankruptcy and fraud.
OptionWeb is an authorized binary options platform. It obtained its European License so it can operate legally under the financial laws of the European Union. Authorized by all EU financial markets regulatory agencies, OptionWeb is the first binary options platform to offer maximum security to its traders.