If you want to trade binary options ('What are binary options? ?')you can't do so directly on the market. You need to trade via a binary option broker. The broker is the link between you and the market. In this article we explain what binary option brokers are, what they do, what differences exist between brokers, and how you can find a suitable broker for you.
What are binary options brokers?
A broker is "an individual or party that arranges transactions between a buyer and a seller for a commission" (Wikipedia). The best known example is a real estate broker: a person who brings buyers and sellers of a house (or other property) together, negotiates an agreement between them, and receives a percentage of the selling price as a reward. It is not any different in the financial world. A financial broker brings together the buyers and sellers of financial products. These products can be stocks, debt, futures ... or binary options of course.
A binary option broker specialises in binary options, and brings supply and demand for these options together. So if you want to buy a binary option on the S&P500 (a U.S. stock market index) the broker looks for someone who wants to sell this option. Because there is no market where binary options are sold directly, if you want to make a trade, you must always do this through a broker.
The broker then provides all the steps needed concerning your transaction: the processing of deposits and withdrawals; ensuring that your money is kept secure; delivering up-to-date price information; the fast and successful execution of your purchases and sales; making good trading software; and providing customer service if you have any questions or complaints. Read more about this here: 'What exactly does a binary options broker do'.
Differences between binary option brokers
Although binary options are a relatively new financial product, there are already several binary option brokers operating on the market. There are significant differences between these brokers. An important difference to look for is how much return on investment a broker offers. On normal 'high/low' options you would typically look for a return of over 80%.
Return is not the only thing that distinguished different binary options brokers from each other. Each broker has its own trading software. It is important that the software of a broker works well for you, and that you fully understand all the options. When you're analysing and trading binary options, you want to be ablt to focus on the market and on your decisions only, and not be distracted by an erratic and unpleasant trading software.
If you are not sure whether you like the software of a broker, it can never hurt to open a trial trading account and try out the software for a few options. If it is not what you want, you can always move to another broker. There are plenty of brokers to choose from, and there is no doubt that you’ll find a broker that's prefect for your needs.
Finally, binary options brokers offer different kinds of extras. For instance, some brokers offer bonuses to new customers on top of their first deposit. (That makes it more attractive to open an account.) Other brokers offer free training materials such as e-books and webinars, to improve your binary options trading skills. Still other brokers give you one-on-one support in your trading account.
Binary option brokers comparison
To make the binary options market more transparent, we have created an overview of binary options broker reviews. In these reviews you will find all the relevant information about different binary options brokers, so that you can compare them and make a better informed decision about which broker to choose.
On the broker review page you can click through to extensive reviews of each broker. In the review, we detail the characteristics of each broker and highlight each broker’s strengths and weaknesses. This way, we hope to make it easier for you to find the best binary options broker.