Be Cautious of Scams and Frauds

Binary options are a safe way for a trader to invest money. However, a trader should be weary of the many frauds and scams circulating through the internet with the intent to trap them.  Always be pre-cautious, and verify the identity and integrity of your broker well before placing any trades.

Because of the highly attractive nature of binary options, many of those who are interested in doing fraud are attracted to them, and attempt to lure innocent traders into scams that may seem well-dressed, but are scams nonetheless. It’s possible to spot these types of companies with their many promises of high returns and bonuses. If a company promises bonuses and payouts that seem unusually unrealistic, try to avoid them, and use extreme caution before considering making any kind of investment.

Some companies who advertise themselves as binary options brokers have no intent to offer honest investments, and are maliciously planning to run away with the investor’s money. These kinds of scams could potentially leave a trader in a position that could be very hard to recover from. To protect yourself from such a situation there are some good things that you should know.

Research and Knowledge

Before a trader trusts a broker with his or her investments, it’s important to ensure the broker is reputable, and has a long track record of success.  In addition, a trader needs to look for reliability from the firm in terms of its ability to meet its end of the bargain with regard to high returns and payouts. Easy withdraws are also a good indicator of the stability a good broker has. Good Customer support, that in addition to personal account matters, can also provide knowledgeable trading information to give you the direction you need during time sensitive trades. You want to make sure a firm has a valid license, and can answer any ‘new investor’ concerns you have openly when you contact them directly.

If it’s too Good to be True, it”s Probably Not

A good rule of thumb to follow is that if the return amounts seem too good to be true, they probably are not. A trader may be attracted to the exorbitant high returns promised by a new broker and place an investment through them, only to find out later that it was a trap, and the disguised firm ran away with the investor’s money. In cases like these, there are little to no option for the trader to get his or her money back. Consumer card companies like Visa or MasterCard don’t hold customers liable for fraudulent charges. However, the process for receiving money back can be time intensive and full of stress. Before making an investment, a way to verify the authenticity of a claim is to see if other brokers are offering a similar payout. By doing so, a trader also have more insight on going rates for similar trades in the market.

Reviews

The internet has really brought a new level of transparency to companies that they never had before. A company’s online reputation can literally make them or break them. One of the simplest yet effective methods to verify a broker’s integrity is to read customer reviews. There are many sources online that can provide a person with reviews and recommendations about a broker from fellow traders. A review consists of trader experiences that can be either good or bad. Details in reviews might contain information about, conveniences, how a problem that arose for the trader was handled by a broker, simplicity in transactions to and from a broker, etc. Information from reviews is very useful, and an accurate way to really know your broker.

Money Withdraws

There should always be several ways available for a trader to withdraw money. Typical methods of withdrawing money are bank checks, and money transfers. Larger brokerages, nowadays, will supply a Visa or MasterCard banking card connected to the traders account. A trader can use his or her account funds in the same way a Visa or MasterCard is used, or the trader can use to transfer the funds to a different account. Conveniences like these become handy as your trades and finances increase, because it doesn’t require you to jump over hoops in order to access your money to diversify your investments.