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Binary Options — Legitimate or Online Gambling?

Binary Options are the hottest new game in online trading. No experience necessary, step right up and place your guess! A quick Google search reveals thousands of ‘brokers’ offering dewapoker hundreds of dollars in sign up bonuses and promises of 70%-85% returns in minutes! If this been there as well, you may be remembering the exploding market of ocean going online casinos that leapt up all over the net many years back before the government began enforcing the UIGEA (Unlawful Internet Gaming Enforcement Act) this season.

Being an passionate sports wagerer and market enthusiast, I couldn’t ignore the correlation that binary options has with playing. In this form of trading you are given two options to choose from: up or down. Is the particular security, currency, or item going to move up or down in the respective time period that you have chosen. A lot like: are the Patriots going to win by 3 or not? Is the score going to be higher or less than 43? You can see where this is going right?

Most legitimate brokers I have voiced with consider binary options to be a straight gamble, but still a legitimate trading vehicle. The problem with binary options that are on offer online right now isn’t with the system itself, it is with the ‘brokers’ that are offering it. As you investor input it: “they are straight snakes. Who offers 100% match bonuses with a trading account? inch In full disclosure, legitimate brokerage house houses do offer bonuses to new clients all the way to $2500 (for a million dollar deposit), and most binary options sites have a limit for the bonuses, but some do not. Now how do these options houses stay in business?

To answer that question, we start to use only look at their ads and do some real mathematics. These sites offer 70%-85% and sometimes higher returns on your investments, so you automatically assume that for every dollar you invest, you will get $1. eighty-five in return. And this holds true, if you win every option that you place. That has to be perfect if these sites were in Fantasy Land, but we all know that you will never win every time. All the facts lets you know you will lose 100% of your investment when that option doesn’t come in. In essence you are endangering $1 for $0. eighty-five on the is actually a 50/50 task. Those my friends are terrible chances.

At these chances, you need to win 58. 8% of your options just to break even. To put these numbers in perspective, let’s take a look at the entertainment capital of the world. The average $1 slot machine game in a casino on the Nevada Deprive pays out at 94. 67%. This means that for every $1 you play, you will be paid out around $0. 97. That’s almost ten percentage points better than these ‘investment brokers’. The question you should ask yourself is: would I put my investment money into a slot machine game? At least in Sin city you can get free cocktails!

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