How to Choose a Broker – Video Tutorial

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Perfect For Beginners!
    Free Demo Account!
    Free Trading Education!
    Get Your Sign-Up Bonus Now!

  • Binomo
    Binomo

    Good Choice For Experienced Traders! 2nd place in the ranking!

HOW TO CHOOSE THE BEST BROKER

The first step towards a positive trading experience is a selection of a reliable broker. The best broker is the one who has the most competitive features, offers high return rates and supports implementation of different types of trading styles. Among most important factors are also size and liquidity.

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Before You Even Start

Selecting the right broker can be a difficult task for beginners since new traders are mostly not aware of all the important differences between brokers and trading platforms. Each platform offers a bit different set of trading tools, return rates, expiry times, bonus deals etc .

Some brokers offer extensive support for beginners by providing written and video tutorials that introduce all the aspects of binary options trading. In addition, some brokers will also offer live trading webinars.

If you never traded before it is advised to open a free demo account with at least one of the proven and reputable brokers, to get familiar with the basics of binary options trading.

The Difference Between Brokers and Platforms

Different brokers use different trading platforms. There is a difference between a broker and a trading platform.

  • A broker is a trading service provider, usually owned and run by a specific business company.
  • The trading platform is a software or an interface, which displays the market charts and enables the trader to place trades.

The types of trading which are offered by specific brokers depend on the choice of the broker as well as on the technology of the trading platforms they use.

Most common trading platforms for binary options trading are SpotOption, TechFinancials, TradoLogic, Panda TS and TradeSmarter. Many brokers offer their own independent trading platforms which are in many cases in-line or even better when compared to the platforms offered by external third party providers.

Trading platforms differ by trading types, expiry times, responsiveness, trading tools and other built-in features such as technical analysis charts, market sentiment display, signals or other similar features.

Important Factors for Selecting a Reliable Broker

Types of Binary Options Trading

Broadest selection of different trading features are offered by brokers who use the SoptOption and TechFinancials platform. Depending on the broker selection of features they want to use, the platforms themselves enable the following types of trading: Short Term (30sec, 60sec, 120sec, 180sec, 5min), Regular Call & Put Options (with 5, 10, 15, 20, 25, 30, . etc expiry times, up to end of day expiry time), Long Term (with expiry times at end of day or at specific date, end of week, end of month, etc), Touch Options, Boundary or Range Options, Above/Below Options, Option Builder, Ladder, Pairs or Pair Stocks, and lately some brokers are also introducing classic FX trading possibilities. When looking into trading options it is also very important to take a look at the expiry times offered for specific trading options.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Perfect For Beginners!
    Free Demo Account!
    Free Trading Education!
    Get Your Sign-Up Bonus Now!

  • Binomo
    Binomo

    Good Choice For Experienced Traders! 2nd place in the ranking!

Expiry Times

When selecting a broker it is always good to pay attention to have flexible expiry times available. In addition to 60 seconds trades, offered by most brokers, it is very good to have the possibility to select 2 minutes and 5 minutes expiry times as well. For the longer expiry times it is always good if the broker offers the option to select as many different expiry options as possible. The expiry times and general list of trading options available will usually differ, based on the trading platform each broker offers. For example, the brokers who utilize the TechFinancials trading platform offer the best flexibility in the expiry times for regular call and put options and a wide selection of trading possibilities. Example of two such brokers are 24option and Boss Capital. These brokers will give you the possibility to implement many different trading strategies and systems, because all their trading options are very flexible.

Return Rates

Different binary options brokers offer different return rates on investments. The difference for similar options can be even up to 10%, which acts as an decisive factor in making profit or loss with your trading. As a general rule it is always good to choose a broker who offers high return rates, however this is not a single or most important factor. If you don’t have the flexibility with previously described expiry times, you might find it difficult to implement your own profitable trading systems and even the high return can rates will not compensate for the lack of expiry times selection. Keep in mind that the return rates on short term trades are always a bit lower as return rates on regular options (with expiry longer than 5 minutes). A good return rate for short term trades (60 sec to 5 minutes) are anywhere above 72% and a good return rates on regular options are anywhere around 80%. Brokers who offer ‘touch’ or ‘high yield touch’ options or ‘ladder trading’ for example, will give you the possibility for much higher return rates on these trades, ranging from 250%, even up to 500% or higher. But you have to be aware that such trades can be placed only in specific market conditions and quite some experience is needed to recognize the best situations where to place such trades.

Bonus Deals

All brokers tend to offer different bonus deals. For example, if you deposit a $250 the broker will match your deposit amount and give you up to 100% bonus, so you will have $500 on your trading account available to start trading. When dealing with bonus offers you have to be aware that all bonuses come with specific conditions. Usually the condition is that you have to trade a certain volume worth of trades before you can withdraw your profits. For example, if you take a 100% bonus deal, the turnover can be even up to 40 times the amount of bonus. So in case you invested $250 it would mean that you have to make $10.000 worth of trades (win or loss) before you can withdraw your profits. Bonuses are always welcome, but you if you decide for a bonus make sure you are aware of the conditions which are tied to specific offer. Different brokers will offer different bonus conditions. However, to be able to freely withdraw your profits at any time, signing-up for a bonus deal is not advised for a first time trader.

Regulation

There are two types of brokers – regulated and unregulated. Main difference is that regulated brokers will not accept traders from United States and unregulated brokers usually accept USA traders as well. Among the regulated brokers a large number of them is registered in Cyprus because of favorable taxing policy. All regulated brokers who are based in Cyprus are regulated by the national securities commission CySec. CySec offers additional security for the traders, since their regulatory requirements are quite strict and oriented towards protecting the traders investment against any fraudulent activity. Additionally, brokers can be regulated in other countries by other country specific commissions who handle Forex, CFD, commodities and binary options trading platforms. Opening an account with regulated broker will give the trader additional security. However, the regulation limits the brokers from accepting the traders from USA. Many brokers choose not to get regulates, simply because they wanted to continue offering their services to USA traders. In these cases it does not mean that, if the broker is not regulated, it is not a good choice. Some unregulated brokers still hold a good reputation among their traders and there are no complications with trading or payouts on their platforms. However, the traders from USA are limited to selection of unregulated brokers only, if they want to engage in binary options trading.

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5 Tips For Selecting A Forex Broker

The foreign exchange market accounts for more than $4 trillion in average traded value every day, making it the world’s largest financial market. Since there is no central marketplace for the forex market, traders must select a forex broker to help them conduct their trading activity. There are a large and growing number of forex brokers, and choosing the right one requires cautiously sifting through an overwhelming number of magazine and internet advertisements. In this article, we’ll look at five considerations when choosing a forex broker in today’s competitive forex marketplace.

1. Regulatory ComplianceIn the U.S., a reputable forex broker will be a member of the National Futures Association (NFA) and will be registered with the U. S. Commodity Futures Trading Commission (CFTC) as a Futures Commission Merchant and Retail Foreign Exchange Dealer. The NFA is an industry-wide, self-regulatory organization for the futures industry in the United States. It develops rules, programs and services to protect the integrity of the market, traders and investors, and to help members meet regulatory responsibilities. The CFTC is an independent government agency that regulates the commodity futures and options markets in the United States. The CFTC’s mission is to “protect market users and the public from fraud, manipulation and abusive practices related to the sale of commodity and financial futures and options, and to foster open, competitive and financially-sound futures and option markets.”

A flashy or professional looking website does not guarantee that the broker is an NFA member or under CFTC regulation. A broker that is a member of the National Futures Association and subject to CFTC regulations will state this and its NFA member number on its website, typically in the “about us” section and on each web page. Each country outside of the United States has its own regulatory body. Due to potential concerns regarding the safety of deposits and the integrity of the broker, accounts should only be opened with firms that are duly regulated.

2. Account DetailsEach forex broker has different account offerings, including:

  • Leverage and Margin: Forex participants have access to a variety of leverage amounts depending on the broker, such as 50:1 or 200:1. Leverage is a loan extended to margin account holders by their brokers. For example, using 50:1 leverage, a trader with an account size of $1,000 can hold a position that is valued at $50,000. Leverage works in a trader’s favor with winning positions since the potential for profits is greatly enhanced. Leverage can, however, quickly destroy a trader’s account since the potential for losses is magnified as well. Leverage should be used with caution. (To learn more, see Forex Leverage: A Double-Edged Sword.)

Commissions and Spreads: A broker makes money through commissions and spreads. A broker that uses commissions may charge a specified percentage of the spread, the difference between the bid and ask price of the forex pair. However, many brokers advertise that they charge no commissions, and instead make their money with wider spreads. For example, the spread could be a fixed spread of three pips (a pip is the minimum unit of price change in forex), or the spread could be variable depending on market volatility. A EUR/USD quote of 1.3943 – 1.3946 has a three-pip spread. That means that as soon as a market participant buys at 1.3946, the position has already lost three pips of value since it could only be sold immediately for 1.3943. The wider the spread, then, the more difficult it can be to make a profit. Popular trading pairs, such as the EUR/USD and GBP/USD will typically have tighter spreads than the more thinly-traded pairs.

Initial Deposit: Most forex accounts can be funded with a very small initial deposit, even as low as $50. With leverage, of course, the buying power is much greater than the minimum deposit, which is one reason forex trading is attractive to new traders and investors. Many brokers offer standard, mini and micro accounts with varying initial deposit requirements.

Ease of Deposits and Withdrawals: Each forex broker has specific account withdrawal and funding policies. Brokers may allow account holders to fund accounts online with a credit card, via ACH payment or via PayPal, or with a wire transfer, bank check or business or personal check. Withdrawals can typically be made by check or by wire transfer. The broker may charge a fee for either service.

3. Currency Pairs OfferedWhile there are a great deal of currencies available for trading, only a few get the majority of the attention, and therefore, trade with the greatest liquidity. The “majors” are the U.S. dollar/Japanese yen (USD/JPY), the Euro/U.S. dollar (EUR/USD), the U.S. dollar/Swiss franc (USD/CHF) and the British pound/U.S. dollar (GBP/USD). A broker may offer a huge selection of forex pairs, but what is most important is that they offer the pair(s) in which the trader or investor is interested. (For more information on the major pairs, see our tutorial on Forex Currencies.)

4. Customer ServiceForex trading occurs 24 hours a day, so a broker’s customer support should be available at any time. Another consideration is the ease with which one can speak with a live person, rather than a time consuming, and often frustrating, auto attendant. When considering a broker, a quick call can give you an idea of the type of customer service they provide, wait times and the representative’s ability to concisely answer questions regarding spreads, leverage, regulations and company details. These details include how long they have been a forex broker and the size of their trade volume (larger brokers generally have access to better prices and execution).

5. Trading PlatformThe trading platform is the investor’s portal to the markets. As such, traders should make sure the platform and any software is easy to use, visually pleasing, has a variety of technical and/or fundamental analysis tools, and that trades can be entered and exited with ease. This last point is especially important: A well-designed trading platform will have clear ‘buy’ and ‘sell’ buttons, and some even have a “panic” button that closes all open positions. A poorly designed interface, on the other hand, could lead to costly order entry mistakes, such as accidentally adding to a position rather than closing it, or going short when you meant to go long. (For more, see 5 Tips For Selecting A Forex Broker)

Other considerations include customization options, order entry types, automated trading options, strategy builders, backtesting and trading alerts. Most brokers offer free demo accounts so that traders can try out the trading platform prior to opening and funding an account.

The Bottom LineIf you have confidence in your forex broker, you will be able to devote more time and attention to analysis and developing forex strategies. A bit of research before committing to a broker goes a long way, and can increase an investor’s odds of success in the competitive forex market. (For related reading, also take a look at Top 10 Rules For Successful Trading.)

Traders University

Even the most experienced traders need to keep learning to stay ahead.
Traders’ University provides information about IBKR products and services in many different ways.
Choose the method that fits your own learning style.

Traders’ Academy

Interactive Brokers’ Traders’ Academy is intended for financial professionals, investors, educators and students seeking a better understanding of the asset classes, markets, currencies, tools and functionality available on IBKR’s award-winning Trader Workstation (TWS), IBKR Mobile, Account Management and TWS API applications.
Our complimentary courses use a blended delivery method of lessons, videos, quizzes, and notes to help TWS users improve their understanding of its tools and capabilities.

Webinars

We offer an extensive program of free trader webinars. Watch, listen, and ask questions from your home or office computer as our webinar instructors clearly describe our technology, trading, and markets around the world. Our webinars are also recorded so if you can’t attend a live webinar, you can experience it on demand at your own convenience.

Live Online Webinars

Our extensive program of free, live webinars let you participate from the comfort of your home or office.

Recorded Webinars

Can’t attend a live webinar? All of our webinars are available as recordings for your convenience.

IBKR Short Videos, Courses & Tours

Our short videos, courses and interactive tours help you get up to speed quickly with Trader Workstation, TWS trading tools and Account Management features, as well as explore stocks, options, futures and forex trading.

Courses & Tours

Mechanics of a Short Sale

The Mechanics of a Short Sale is a tutorial that is designed to show you the inner workings of how a Short Sale works.

Running Time: 2 mins

Introduction to Technical Analysis

The Technical Analysis Tour explains the important role of the chart analyst and how technical and fundamental analyses differ. In this introductory tour, you will learn how to identify areas of support and resistance on a chart, the role of different time frames, and how to interpret basic trend formation.

Running Time: 24 mins

Mechanics of a Foreign Stock Transaction

The Mechanics of an Overseas Stock Transaction Tour describes the choices facing investors wishing to invest in stocks denominated in currencies other than their base domestic currency. This tour attempts to explain these alternative approaches and also shows the impact of exchange rate risk on transactions that can be made overseas.

Running Time: 17 mins

Options 101: Pricing

The Options Pricing 101 course is designed to familiarize traders with the variables in options pricing models.

Running Time: 9 mins

I have read the User Agreement and wish to watch the tutorial.

Options 102: The Greeks

The Options Greeks 102 course is designed to familiarize traders with a set of Greek risk factors used to monitor a portfolio’s profile.

Running Time: 6 mins

I have read the User Agreement and wish to watch the tutorial.

Options 103: Strategies

The Options Strategies 103 course is designed to show how options work as a tool for hedging positions and how they can be used for speculative purposes.

Running Time: 13 mins

I have read the User Agreement and wish to watch the tutorial.

Forex Markets 101

The Forex Markets 101 Tour is designed to help investors recognize the nature and needs of participants in the currency market along with how various foreign currency instruments have been developed to create the largest traded market around the globe.

Running Time: 14 mins

I have read the User Agreement and wish to watch the tutorial.

TWS Basics

A high-level overview of the Trader Workstation (TWS) feature set, focusing primarily on the Mosaic workspace.

Running Time: 13 mins

Understanding Margin

Introduces you to the basics of IBKR margin accounts. Learn when and how IBKR calculates margin and how to use the Real-Time Monitoring features in Trader Workstation to manage your trading risk.

Running Time: 24 mins

IB Tax Optimizer

Tax Optimizer allows customers to match specific lots on a daily basis, but it doesn’t stop there. It also provides seven lot matching methodologies and lets customers run real-time “what if” scenarios to see the impact of each method on capital gains and losses.

Running Time: 23 mins

Apps, Tools and Widgets

Traders’ Calendar App

Have the complete schedule of trading holidays and expiration dates for all asset types on all exchanges around the globe at your fingertips – with IBKR’s 2020 International Trading Calendar. Elect to view holidays and expiration dates in Monthly view or List view. Tap a date in Monthly view to see that day’s complete listing of holidays and expirations. See only what interests you in the List view, which comprises a comprehensive catalog of expandable/collapsible list items that make it easy to find just what you need.

Options Calculator App

The Options Pricing Calculator is a free App that allows users to price options using a “what-if” type analysis. The calculator allows users to input the underlying price of a security, the striking price of an options, the number of days to expiration and other necessary inputs. The output displays not only the theoretical price for both calls and puts using those assumptions, but also the array of associated Greek values for each side of the equation. Use the calculator to make changes to any of the input fields to learn the impact on the price of an option.

Options Strategies App

The Options Strategies Widget allows investors to view the profit-and-loss profiles of an array of option combinations that might help in their understanding of option and stock trading. The Widget is a free downloadable tool and can be used by investors wishing to understand better how to use options and options combinations to speculate on an underlying security or to hedge against an adverse movement in a security they currently own. The user can select from a series of drop down menus to isolate bullish or bearish movements in the price of an underlying security or could select a strategy that would perhaps benefit under a period of either rising or falling market or security specific volatility.

Options Pricing Calculator Widget

The Options Pricing Calculator Widget is a free downloadable tool that allows users to price options using a “what-if” type analysis. The calculator allows users to input the underlying price of a security, the striking price of an options, the number of days to expiration and other necessary inputs. The output displays not only the theoretical price for both calls and puts using those assumptions, but also the array of associated Greek values for each side of the equation. Use the calculator to make changes to any of the input fields to learn the impact on the price of an option.

I have read the User Agreement
and wish to watch the tutorial.

Options Strategies Widget

The Options Strategies Widget allows investors to view the profit-and-loss profiles of an array of option combinations that might help in their understanding of option and stock trading. The Widget is a free downloadable tool and can be used by investors wishing to understand better how to use options and options combinations to speculate on an underlying security or to hedge against an adverse movement in a security they currently own. The user can select from a series of drop down menus to isolate bullish or bearish movements in the price of an underlying security or could select a strategy that would perhaps benefit under a period of either rising or falling market or security specific volatility.

I have read the User Agreement and wish to watch the tutorial.

Probability Lab

The Probability Lab SM offers a practical way to think about options without the complicated mathematics. Use the Probability Lab to analyze the market’s probability distribution, which shows what the market believes are the chances that certain outcomes will occur. Adjust based on your own forecast.

I have read the User Agreement
and wish to watch the tutorial.

Trader’s Glossary

The Traders’ Glossary is only available from a desktop computer.

Interactive Brokers ®, IB SM , InteractiveBrokers.com ®, Interactive Analytics ®, IB Options Analytics SM , IB SmartRouting SM , PortfolioAnalyst ®, IB Trader Workstation SM and One World, One Account SM are service marks and/or trademarks of Interactive Brokers LLC. Supporting documentation for any claims and statistical information will be provided upon request. Any trading symbols displayed are for illustrative purposes only and are not intended to portray recommendations.

The risk of loss in online trading of stocks, options, futures, forex, foreign equities, and fixed Income can be substantial.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Perfect For Beginners!
    Free Demo Account!
    Free Trading Education!
    Get Your Sign-Up Bonus Now!

  • Binomo
    Binomo

    Good Choice For Experienced Traders! 2nd place in the ranking!

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Guide How To Become Binary Options Trader
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