This a quote taken from a binary option provider taken off the Internet.
Search results on Google for binary option providers are staggering and many ignorant people are getting fleeced by the minute.
Yes, you can make 75 per cent in an hour, but you can lose it all even quicker.
These products are dangerous.
If you want to lose money quickly, then binary options are just the thing for you.
Binary options have been aggressively marketed recently and the Internet is flooded with adverts promising huge returns in very short spaces in time.
The reality though, is trading of binary options amounts to nothing more than gambling.
It’s like betting “red” or “black” on a roulette wheel, but with a twist: the casino never loses.
Let me explain …
Take the word “binary” and imagine the numbers one and zero.
You are either going win or you are going to lose.
That sounds pretty much 50/50 right? Wrong?
The way these options work is that you take a bet on the direction of the price of a tradable asset in a specified (short) time frame.
This time frame could be from a few minutes to an hour.
This means that you now have “time” against you too.
You do not have the luxury of waiting for the price to turn back into your favour. When your time is up, you lose it all.
Now let’s assume you are right and you make a correct call.
The broker payouts on these options deduct a massive commission from your winnings.
This means that even when you are right, you do not double your money as in roulette.
You will only make about 80 per cent (maximum) on a correct call.
Now do the maths …
That means you are paying a minimum commission of 20 per cent to the broker.
So now you have time and the fees against you.
But what happens when you are wrong?
Well that answer is simple: you lose it all.
The odds are completely stacked against you and they get even worse after your first loss.
They are designed to be an “all or nothing” product and the “all” part literally means your risk on capital.
Even when you win, you lose something.
The only ones making the real money here are the binary option brokers.
The scary part is that a very large number of them are unregulated.
Do not kid yourself, these are gambling sites.
Most of their marketing is done on poker sites and finds its way onto Facebook and these people try to legitimise themselves by giving it an “investment” angle.
It’s only a matter of time before regulators swoop down on these folk (mark my words).
These guys are only after your cash.
Even if you do win, chances are you will struggle to withdraw money from that account.
It’s always best to seek advice and gain knowledge of any investment product before you throw your money at it.
I have made myself available to you through the Benoni City Times so please use the resource if you need financial guidance – you are welcome to reach me through the paper.
When it comes to trading these devilish products, I suggest you heed my advice.
Also read:
Even the stock market celebrates Christmas – most of the time
A simple way to use your money to invest offshore
Exchange traded funds laid bare
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