Why You Should Choose Binary Options
You can trade in the stock marketing using binary options. Binary options allow you to select a product and determine whether its value will increase or decrease in a certain period. The basics of binary options are simple: correct prediction means you win; while incorrect prediction means you lose. Your loss or gain depends according to the size of the increase or decrease of that particular product.
Unfortunately, though, binary options have suffered from a poor reputation. This is primarily because of the actions of a few brokers, as well as the options being classified under gambling in some countries.
How Binary Options are regulated?
The good news, however, is that binary options are evolving. There are changes in legislation for binary options UK that offers protection to consumers that they haven’t previously enjoyed. Sooner, binary options could be classified along with other financial instruments, eventually joining the financial mainstream.
Previously, the UK government had left the responsibility of controlling and regulating binary option brokers to the Gambling Commission. Thus, it didn’t help the reputation of this financial instrument. Aside from that, the commission is not equipped in effectively regulating brokers.
Over the summer, the UK government had conducted a consultation exercise to evaluate whether the binary option regulations should be handled better by the FCA. They asked the views of significant stakeholders and wider public. The consultation ended in July, and the findings are soon to be published early in 2016. It is said that the government seeks to be in alignment with the EU — that categorizes binary options as financial instruments, rather than bets.
Eliminating the Myth
Despite being a simple form of investment trade, people mistaken binary option as having only 50/50 odds; thereby, classifying it as gambling — but that is completely not true. Like forex, education is vital in trading with binary options if you are looking to trade in order to gain money. The better understanding you have about the market and the type of asset you’ve chosen, the more likely you are able to predict the direction of the value of that asset. This 50/50 theory is often wrongly used to evaluate the probability of winning. However, it is used by experts in binary options to describe the outcome of the trade — which is either win or lose.
Why Binary Options?
Aside from being simple, it is very exciting to be involved with. It involves fast profits which attract people who would think twice of investment rating. The ratio of risks to rewards would require traders to be fully aware of how much they can win or lose anytime; therefore, lessening their attachment in each trade.