Binary Options Broker

Binary options broker dealers compete for business in a very competitive industry today. Traders who are not careful in their selection of a binary options broker can miss out on valuable profits and incentives. Here are three things to consider when choosing where to trade binary options.

Bonus Cash Offers

Without a doubt the biggest most glitzy offer made by companies in this industry is the offer of considerable amounts of bonus cash on new deposits. Competition amongst brokers is very high, and attracting new clients to this rapidly expanding financial field is a priority. As a result firms offer generous cash incentives to attract and retain new clients. The incentive offers come with restriction however, and as always the devil is in the details. For example one firm might offer 25% bonus on new deposits but requires traders to execute trading volume 15 times the amount of the deposit plus bonus. It definitely pays to read the fine print on any of these bonus plans.

Trading Parameters, Yields, and Policies

The second way a binary options broker competes is by its trading policies. The nature of the industry is such that trading happens very rapidly, and contracts flip over every hour (or even sooner). In order to maintain an organized business, a binary options broker has to set specific trading policies which define when and how contracts will be exchanged. One example of an important policy is that of trade lockout - i.e. the time beyond which no more orders for a contract will be taken. Lockout ranges anywhere from 25 minute prior to expiration to as low as 5 minutes. Obviously the trader with access to the latest expiring contract has the biggest advantage in the market.

Securities Offered

The last significant way competitors in the industry vie for business is by means of specialization in particular securities. Nearly all participants in the industry offer the standard stock indexes and forex cross pairs to trade with, but the firms diverge considerably when it comes to stocks and foreign indexes offered. Some firms have a number of foreign indexes to trade, such as the Asia Bombay India index or the Hang Seng of Hong Kong while another might prefer the IBEX of Spain. A person trying to finding the right binary options broker must take into account what securities are traded.