Published On: Fri, Jun 12th,

What Nobody Tells You About Forex Binary Options Trading


There are many different ways to trade Forex.

The original and traditional method is to go “Long” or “Short” using a “lot” based brokerage account.  This is still by far the most popular way to trade Forex today.  Other options include futures, options, fixed odds and spread betting.

The newest kid on the block however is Forex Binary Options.  This approach has only been around for 10 years or so but has gained much interest and momentum.  This is not because it is more profitable than the other approaches.  Actually, the complete opposite is true, you are almost certain to lose.

Forex Binary Options are popular for one reason only.  Brokers who know you are almost certain to lose offer huge incentives to affiliates and to you…

100% Deposit Bonus

You must have seen the headline “100% Deposit Bonus”.  This incentive is now touted by almost every single Binary Options broker.  People think, hey, what an offer!

  • I make an instant 100% profit and withdraw it all!
  • I can lose half of my account, stop and withdraw my deposit and I have lost nothing

Well, before you fall for this marketing ploy pay attention to the small print…

If you accept a bonus offer from any Binary Option broker, you will have to “make trades worth 20x the amount of your deposit and the bonus you received” – Before you can make a withdrawal from your account.

Let’s say you deposited £500 and you got a £500 bonus, total £1,000.  You now have to make trades worth £20,000 before you can make a withdrawal.  Many traders consider 2% risk per trade an acceptable approach.  If you were to apply this to your Forex Binary Options trading you would be risking £20 on each trade.

The maths are not difficult.  This means you now have have to make 1,000 trades worth £20 each.  This equates to about 5 trades a day for about a year – Before you can make a withdrawal from your account.

TIP 1 – Do not accept a bonus offer if you open a new Binary Options account.  If you do you will not be able to make a withdrawal from your account until you have placed almost 1,000 trades assuming you adopt a sensible 2% risk per trade.

This is Tip 1 of 7 from my article and Info graphic on the subject of Forex Binary Options.  As you will read you will probably not even be around long enough to make that withdrawal…