What is the binary options broker?
The qualitative broker’s platform is one of the key elements for successful trading. A broker is a company whose task is to provide a trader with legal access to the financial market. The broker is the intermediate between the trader and the stocks. Binary broker conducts this process of intermediation with the help of specialized programs — trading terminals are located on the sites (broker’s platforms) where the trader carries out all the operations.
The trader needs to employ the broker’s services due to for legislative reasons. An individual can’t independently execute contracts on the exchange. Only a legal entity that has an appropriate license to operate and is accredited on an exchange trading floor can execute trading positions in the financial market. That’s why the trader needs the broker’s intermediation.
Let’s see how the trading process happens. The trader gives the broker an order to execute a certain transaction — to sell or buy an asset. The broker brings the trader’s position to the market either on your behalf or on its own. As a result of the transaction, the profit is credited to the broker's account, after which the broker transfers the funds to the trader's account.
Let’s see how the broker makes money. For example, one trader opens a CALL option and deposits $100. The second one opens a PUT option and also deposits $100. If the first trader wins, the broker pays him a $70 profit and returns his $100. The second trader wins nothing. As for the broker, he gets the guaranteed commission in the amount of $30. That’s why the broker’s business is highly beneficial.
The main functions of the broker platform
- Providing the trader with the opportunity and room for binary trading. The broker’s platform acts as the assignee of the trader while he works with the stocks. The broker provides the trader the opportunity to register the personal account. A trader’s personal account is a special section of the site that allows a trader to deposit, store and withdraw the money gained, and to follow the state of his transactions.
- Providing the trader with the assets for the work. The broker’s platform works with different assets and the trader can select some of them for the trade. The most advanced platform works not only with forex pairs and stocks but also with cryptocurrencies and CFDs.
- Providing the trading instruments. Often trading platform gives the trader some instruments to simplify the works and to increase the profit with the trader’s commission. The most common instrument the brokers offer is the online chart. Charts are used to track the binary signal and the trading indicators to estimate the profitability of the signal.
- Providing the client with information concerning the state of the market. Most of the brokers’ sites have a section with market news. In this section trader can know what’s going on with the currency he trades in real-time and select the most promising assets.
- Demo account for practice. Brokers provide the traders with the demo account where they can learn to trade, understand the work of indicators and create the trading strategy. The demo account is especially important for novice traders.
- Storage of the trader’s funds. When the trader opens the account, he deposits a certain amount of money to open the options. After he wins, he needs to withdraw these funds. The broker’s platform helps the trader to do it. Also, the broker’s platform store the money which the trader has deposited but not yet used. This is especially important for long-term trading that may last for several weeks.
What is the minimum deposit?
When the trader opens the real account and starts to work with real many, there is a high probability that he loses everything. That’s why It is much smarter to start the real trade with the minimum deposit and then, increase this sum step by step. The minimum deposit is the smallest amount with which a trader can start trading.
The amount of the minimum deposit may vary. From the first glance, it seems that the broker has zero profit from the trader with the minimum account. However, brokers offer such an opportunity for novice traders in order to attract new clients. The first transactions of novice traders are not always successful. He still makes mistakes and loses money. If he loses too much, he will leave the trading platform. To save the clients and to attract new ones the broker sets the minimum amount of deposit. With the minimum deposit the trader selects suitable financial assets and strategies, and in the future will probably invest larger funds, since he already knows how to make money on binary options.
It is necessary to distinguish two important terms — minimum deposit and the minimum rate. The minimum deposit is the minimum sum the trader can have on the personal account. The minimum rate is the minimum sum the trader can bet. Usually, most brokers offer the minimum rate in the amount of $1.
Who can use the minimum deposit:
- Novice traders that are not recommended betting a huge amount of money. With a small deposit, the beginner can overcome psychological barriers and avoid the strong negative emotions during the first losses.
- Traders that don’t dispose of large funds. The small deposit makes the broker platform more available and customer-friendly. Users can estimate the quality of the platform and continually increase the amount of their minimum rate.
- Risky traders preferring aggressive trading with numerous transactions per unit of time. This style of trading provides the opportunity to receive a high income in the short term.
How to choose the broker for the binary options trading?
Many traders ask how to choose the broker and avoid fraud also called “scammers”. Unfortunately, trading on the minimum deposit doesn’t help to identify the unfair platforms. Usually, they reveal themselves when the trader starts to win and increase the amount of the deposit. The fraud broker just blocks the trader’s account without a reason and avoids any contact. As the result, the trader loses the money gained.
That’s why the traders should pay careful attention to the reputation of the broker they choose and the quality of the service. That’s why is it recommended to check several important features of the broker before starting to trade.
- The license of the body that regulates the financial market and trading. This may be the license of the international regulator or the regulator from your country. Sometimes brokers obtain several licenses because it simplifies the settlement of questions with traders. Trader turns to the regulator in case of financial issues. If the regulator and the trader are from the same country, the language barrier disappears and it speeds up the process of settlement. The most well-known regulators are the CySEC (Cyprus Securities and Exchange Commission) from Cyprus and FCA (Financial Conduct Authority) from United Kindom.
- Assets available for trading. A good broker provides a large number of assets to work with. There may both classical currency pairs and crypto pairs. The modern broker is available to offer the different equities: forex, stocks, indices, futures, binary options, commodities, ETFs, digital money. Check if the broker works with the asset you are interested in.
- A number of years on the market. The most stable and respected brokers have a long history of the company. They’ve been on the market for many years that’s why they have great experience of the works with clients. The new brokers are also may be trustworthy but they don’t have too many reviews and no one can exactly say will this platform stand long enough.
- Terms and conditions. A good broker works honestly and doesn’t hide anything from the clients. A clear service agreement simplifies the work of both trader and broker and helps to act in difficult situations. Read the service agreement attentively before start to work with the broker. If something in this document seems unclear contact the broker’s support service and ask to clarify the term.
- Good reputation and the positive reviews of the other traders. The comments of the other traders are very important because you can get familiar with the experience of the other users and avoid fraud. Of course, there is such a thing as a personal negative experience. Sometimes traders may be disappointed by the losses and because of it of they can write bad reviews about a certain broker. But if you see too much negative review describing the same situations, better avoid this broker. You can find the reviews of the broker platforms on the sites with recommendations. Also, you can discuss the brokers with the trading community on social media.
- Opportunity to trade on the demo account enough time. The demo account is necessary to get familiar with the interface and the tools of the trading platform. A good broker doesn’t have serious restrictions concerning the work of the demo account, and the major part of the currencies and trading tools will be available there.
- A reasonable amount of the minimal deposit. The good broker understands that not all traders can enter the market with a big deposit. Often traders need some time to become keen on the trading process. Providing a minimum deposit to a client shows the client-oriented approach of the broker.
- Quick and client-friendly technical support. All traders may face some kind of difficulty. The good broker always indicates the contact for the technical support to ask the questions. Good technical support tries to answer a request as fast as possible and stays polite. If the broker can’t provide good communication and avoid answering your requests (especially when it comes to money), it may be a sign of fraud. Pay attention to the during which the broker answers you. Check the tone messages.
- No problems with the withdrawal of money. The good broker has many methods to withdraw the funds and doesn’t require too many unnecessary verifications. If the broker suddenly blocks your account after you have gained a certain amount of money and doesn’t get in touch with you, this is the first sign of fraud.
- Qualitative working instruments. The good broker will offer numerous tools that will simplify the market analysis. Test the work of all tools while you get familiar with the trading platform. The work of the instruments should be clear for the users. That’s why the good broker places on the site brief information about trading tools.
- Quality of trading platform. The platform should work without problems on different operating systems. The bad quality of the trading platform can delete all work of the trading. If there a bags and delays and the broker doesn’t check or correct them, this means that the owners don’t occupy the site. Pay attention to the during which the broker solves the technical problems.
- Educational materials for beginners. A good broker place of the educational and reference materials on the site. These materials explain the work of the trading tools and simplify the acquaintance with the trading process. Also, the broker may include information about the strategies, assets, technical and fundamental analysis.
- No false hopes. A good broker understands that in most cases all depends on the trader. But this not always the fault of the broker. The loss can be caused by unexpected external factors or an ineffective trading strategy. A good broker always prevents the trader that it is he who is responsible for the success of the trading process. And the task of the broker is to give the trader a maximum opportunity for making money.
TOP 6 brokers for binary options
Currently, there are numerous brokers on the market. The novice trader may be confused by such abundance. Each broker has its own offers for potential clients. However, the novice trader may be confused by a large number of the broker’s on the market. That’s why we created TOP 6 of binary options broker. This TOP is based on the crucial characteristics of brokers such as the number of withdrawal methods, amount of payouts, and deposit number of years on the market. We collected the most reliable brokers with serious experience of work on the market. Read the main characteristics of the broker’s platform and choose the one you want to trade with.
Deriv was founded in Malta in 1999. Earlier this platform appertained to another broker Binary.com. That’s why if you are familiar with Binary, you may surely move to the Deriv. The unique feature of this broker is the four trading platforms — DMT5, DTrader, DBot, and SmartTrader.
DBot is the platform for auto-trading. There three prebuilt strategies, numerous assets to trade, and the performance tracker to maximize the returns.
DTrader is a platform that needs no download. This platform offers to use over 50 assets. A trader can customize the chart or place on it all the necessary widgets and indicators.
DMT5 (Deriv’s MetaTrader 5 platform) is developed specifically for professional traders. It offers over 70 assets, advanced technical indicators and it is free to download.
SmartTrader is a platform that suits trade types based on options and multipliers.
- Broker is not available for US clients.
- No welcome bonuses.
- Lack of standalone trading tools.
- No social and copy-trading.l
Deriv works in the market for more than 20 years and has a good reputation due to predecessor companies. The broker’s platform provides a wide range of assets and ways to trade. Users can deposit and withdraw the money without a commission, also there is an opportunity to open a cryptocurrency account. Even the beginner can understand the work of the platform because there are detailed instructions and guidelines about the trading instruments.
As for the disadvantages, the Deriv broker doesn’t have the ruble account thus if you deposit the rubles on your account there may be losses during the conversion. MasterCard cards are not accepted in Russia, only Visa. After the rebranding, it is difficult to find reviews of Deriv on the Internet. Some clients face problems when depositing or withdrawing funds.
Starting to trade with Deriv is easy. It is necessary to register on the official site and to create an account. You may use your email or enter through the Google or Facebook account. During the first entrance, it is necessary to create the password and choose the resident country. Then, you can deposit the real money on your balance or trade on a demo account. Besides broker has its own forum we users can share
Deriv doesn’t need verification, the client receives access to the platform without restrictions.
If there are any difficulties the technical support of Deriv offers several ways to contact: email, online-chart, or through personal messages in social networks Facebook or Twitter. Besides the broker has its own forum where users share with each other their observations, problems, and solutions.
IQ Option is a well-known and reliable broker that has won many awards from 2017 to 2021. Already millions of people from 210 countries are trusting and using the IQ Option. The IQ Options provide a huge number of trading assets including cryptocurrencies. Also, IQ Option provides a free trading account for €10 000. For the quick technical analysis IQ Option offers News Feed, Economic Calendars, and more than one hundred widgets and technical indicators.
- Not available for traders from the US, Canada, Australia, Japan.
- Restricted leverage for non-professional clients.
- No fixed spread accounts.
- No litecoin trading.
The history of the broker begins in 2014. A year later, IQ Option received an award in the category “Best Binary Options Broker in Europe”. In 2016, the broker stopped its work in Russia due to the lack of legal regulation in the field of binary options trading. In 2020, the broker's platform had about 50 million users from 219 countries. Compared to 2014, the number of transactions increased by 800%.
On the IQ Option broker platform, traders can trade two types of options: Digital and Binary. Digital options differ from Binary options in the way of determining the yield. Binary options have a fixed income. In Digital options, the profitability depends on the strike price: when the near price quote set by the broker is reached, the profitability is standard, but the further the price moves in the right direction, the bigger is the profit.
The IQ Option site has been translated into 17 languages. The site publishes news, historical quotes, training, and a calendar of important macroeconomic events.
It is very easy to start trading on the IQ Option broker platform: you need to register by email or log into your Google account or Facebook. After that, the trader can immediately test the platform on a demo version, and then confirm his account by email. Immediately after registration, the user receives the opportunity to trade on a demo account or deposit real money to the balance. A demo account is available for $10 000, if, during the training the trader uses up the balance, it can be restored without any problems. You can deposit in any convenient way: through Mastercard or Visa bank card, electronic wallets Qiwi, Webmoney, Advcash, Skrill, Neteller, or through a Bitcoin cryptocurrency wallet.
The IQ Option binary options trading platform is available in both desktop and mobile applications. There are 4 types of charts on the trading platform: lines, candles, bars, and Heiken-Ashi. You can sell the option before its term ends if there is a possibility of losing the entire deposit with a smaller or larger profit. It is possible to display up to nine charts on the screen.
The IQ Option website regularly runs tournaments for traders, the prize funds of which reach up to $50 000. The winnings can be withdrawn from the account or used in binary options trading on the broker's platform. The winner is the trader who increases the deposit on his account more than others. Due to the high competition, it is difficult to win the tournament, but it is worth the effort to win.
IQ Option broker provides traders with more than 20 indicators for technical analysis of the market: trend, oscillators, market volatility, and volume indicators. The settings of all additional instruments can be saved to a template and used in binary options trading.
Many assets are available on the trading terminal: all popular currency pairs, the OTC electronic platform for trading on weekends, gold, 20 stocks of large companies. Forex markets are also available on the broker's platform, they allow you to trade currencies, cryptocurrencies, ETFs, stocks, commodities, and indices.
For novice traders, there is a section “Education” is on the site. Here you can find video tutorials with answers to the most frequently asked questions, guides on working with indicators, videos on news trading, and other useful information.
IQ Option technical support is available 24/7. To communicate with the support service, there is a feedback form is on the site, a chat with consultants, and a hotline in 20 countries.
IQ Option has a large experience in binary options trading and won the trust of more than 50 million traders around the world.
Pocket Option is the modern platform that was created was founded in 2017 by a team of talented IT and FinTech specialists. Now, this platform is available in more than 95 countries and regions. The main interesting feature of this trading platform is the affiliate program. The users may not only make money on binary trading but also become an affiliate of Pocket Option.
- Most educational materials are in English.
- A large amount of minimum deposit.
- Not available on Ubuntu.
- One trading account available.
Binary options broker Pocket option is a fairly young company among its counterparts, it opened in 2017 in the Marshall Islands. A year later, the broker received a certificate from the Russian regulator, which confirms the reliability of the broker's financial services. By 2020, more than 10 million clients have already been registered on the broker's site.
On the Pocket option broker's platform, traders can make bets on the fall or rise in asset quotes for a selected time in relation to its value at the time of buying the option. If the forecast is correct, the client receives a fixed profit, if the forecast is unsuccessful, he loses the amount of the bet.
All traders registered on the broker's website are assigned a status. The client who has joined the platform for the first time is called “Stranger” and he receives the opportunity to trade on a demo account and participate in free tournaments. After depositing the balance with real money, the trader's statuses change depending on the amount on the account. For example, up to $100 — Newbie status, up to $1000 — Beginner, up to $5000 — Experienced, up to $15000 — Master, up to $50 000 — Professional, $50 000 — Guru. The higher is the status, the more opportunities the broker provides: participation in tournaments, favorable conditions for bonuses, cashback, and risk-free transactions.
The Pocket option site is translated into 22 languages. To register on the site, you should enter your email and create a password, you can also log in through your Google or Facebook accounts.
After registration, the user receives a promotional code for the first deposit, which gives a 50% bonus on the deposit made from $50 to $5000 and this bonus can be withdrawn when the total amount of transactions exceeds the amount of funds received by 25 times. The broker provides novice traders with a demo account for $1000, it is unlimited and can be restored.
Pocket option users have access to desktop and mobile applications. Traders have access to five types of charts, the ability to display up to 4 assets on the screen, customizable indicators. However, the number of indicators on the mobile platform was cut down.
On the Pocket Option trading platform, a trader can trade currency pairs, US and Russian stocks, cryptocurrencies, and commodities. On weekends, trading of the OTC currencies, commodities, and stocks is available.
For novice traders, the Pocket option offers to complete the training, that is presented on the site. The Training section includes: various instructions on how to work with the broker's platform, detailed reviews of trading strategies for beginners, a tutorial on working on Forex, guides on fundamental and technical analysis, trading psychology, etc.
If you have any questions, technical support is available 24/7 to the broker's clients. There are several communication channels to choose from: email, phone, or online chat in your personal account.
Olymp Trade is a brand that has stood the test of time. This broker appeared in 2014. It is still in business today unlike so many others of its kind. The company is adding new assets all the time with 30 just put on the list in late 2020. The main interesting feature of Olymp Trade is the insights and news that the platform publishes on the site in real-time.
- Not available for traders from the US and UK.
- No meta-trader platform.
- A small number of withdrawal methods.
- No social trading.
Olymp Trade started its work in 2014. For 7 years, more than 340 thousand traders have registered on the site. Currently, the total amount of payments exceeds 20 million dollars. In 2016, the broker insured all its transactions with the international Financial Commission FinaCom. This means that in disputable situations, the client can contact the company with a claim and receive compensation up to 20 thousand dollars.
Conditions for entering the trading platform — $10. The minimum bet is $1. Olymp Trade's payout percentage is one of the highest among all brokers — up to 92%. You can withdraw funds in any convenient way. The broker works with the world's most popular electronic wallets Webmoney, Skrill, Neteller, Bitcoin, Visa, Mastercard.
The Olymp Trade site was translated into 19 languages and works in any country. Currency pairs, commodities, indices, cryptocurrencies, ETFs are available for trading. A trader can trade on a PC or download a mobile application.
To open a demo account, it is necessary to register. You can do it using email, or social networks like Twitter, Facebook. After registration, the user can open a professional account: Starter, Advanced, Expert. The deposit and profitability depend on the trader's status.
After a trader has registered, educational materials with instructions and strategies are available for him. Free webinars are regularly held on the platform. Also, the registered user has access to the economic calendar, review of the assets, and basic signals.
ExpertOption is a popular online broker offering digital options and fast online trading. So if you are looking for the perfect platform for online trading, pay attention to ExpertOption. This platform gives users numerous educational materials concerning technical analysis and trading indicators. The platform is available on devices with different operating systems — Windows, iOS, Android, macOS.
- Not available for traders from the US, Canada, Australia, Israel.
- No Islamic account.
- Not available on Ubuntu.
- Doesn’t work with Mirror Trader.
Expert Option has been registered on the market since 2014. During this time, 42 million accounts were opened on the platform.
To start, a trader needs to make a minimum deposit of $10 and make a bet from $1. The broker promises a high percentage of payments — up to 95%. The site allows a trader to trade currency and cryptocurrency pairs, stocks of American companies, and commodities. The broker is available for the whole world, so the company's site has been translated into 15 languages.
In order to start trading, you need to register using email or through Facebook or Google.
If a trader has entered the site for the first time, then he receives a welcome bonus in the amount of 100% of the deposit. It works for a month, and then it burns out. However, it is impossible to withdraw this amount, but it is real to trade and increase capital.
A novice trader can practice on a virtual account without registration. For training, the broker provides the trader with $10 000.
The entire interface that the user sees in the Demo mode is preserved for the real account. Therefore, the user will be able to easily pass to the real trading.
The social radar is one of the main advantages of the Expert Option. It shows how many traders are currently trading, in which direction, and which amount the trades have. It helps the user to understand the sentiment of other traders and to analyze the option.
The broker works on Windows PC and macOS. Also, you can download the mobile app for Android and iOS.
Binomo is a modern trading platform that suits both beginners and professional traders. It won several awards and the Financial Commission assigned her category A. It offers the client various trading options and the unique mode of trading Non-stop. Also, some quotes are available on weekends.
- Not available for US traders.
- You can trade only classic Call/Put options.
- Not available on Ubuntu.
- Less variety of assets.
The site also dates back to 2014. After 4 years, Binomo becomes a Category A member at FinaCom.
Four categories of assets are opened to the trader for the work. These are currency pairs
cryptocurrencies, stocks, and commodities. Before registration, the user can utilize the educational materials on the site. You can register via email, Google, or Facebook account. Broker Binomo is popular in many countries around the world. That’s why the site was translated into 13 languages.
To start trading, you need to deposit $10 and make a minimum bet in the amount of $1. Binomo provides deposit bonuses depending on the account status — 100%, 150%, and 200%.
The broker also rewards its traders with regular promotions, for example, it gives higher bonuses.
Binary options broker Binomo prepared a large number of educational materials for beginners. For all technical questions, you can contact the support service, which works 24/7.
Things to pay attention
To choose the necessary broker you need to decide which thing is the most important for you. This may be the amount of the deposit, a number of trading indicators, or the opportunity to trade the cryptocurrencies. Define the necessary criteria and compare the brokers basing on these features.
Start your trading on the demo account and test the work of different indicators and assets. If you see that something doesn’t work, contact the support team or choose another trading platform.
Pay attention to the operating systems for which the brokers are available. For example, you work on iOS, pay attention to the brokers that are compatible with the Apple technique. The most advanced brokers try to maximally expand the potential audience and be available on all types of devices.
Read the reviews of other traders and independent trading experts. You can find such experts in the trading communities in social media, special forums or, you may look for the YouTube channels of professional traders. They often create video reviews of the trading platforms and show how the certain platform works in real-time.
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