The heat of the sun is beating down hard and sweat is dripping into the eyes of a construction worker. Every day, he toils. Every day he hates his job and is looking for better opportunities in life. One day, he does an online search and finds articles about binary options.
As he digs and researches, he is getting very excited about this fortune that he is getting ready to make. He sees advertisement where he can make sooo much money! The dollar signs are now replacing his eyes. He runs to tell his wife that he just found something... a secret that no one knows about. He tells her how he can make 70% profit on every single trade and not only that. He can deposit $500 and they will just give him another $500 and double his money right out of the gate!! How awesome is this! Even further, he can just follow their signals and make money every hour of every day!
So this construction worker goes to a local payday loan place and borrows $500. He knows the interest is high but with all of the profits he will make, he can pay off the loan in no time! Boy oh boy is he happy!
Driving home, he grins as he plays a mental picture of what his life will be like in 6 months. He has seen all the pictures of guys driving fancy cars. He has listened to story after story of untold riches... the easy money. He also dreams of laying in his hammock by the beach.
So it is 2 weeks later now. He has deposited his money in a binary options broker from some little island no one has every heard of. He accepted their generous offer of a 100% sign on bonus. He is getting ready to start trading.
Trade one... WINNER!!! Wow! He is so excited. He 'invested' $100 and they payed him $70 for total of $170. This is totally mind blowing!
Trade two... WINNER!!! OMG! He took that $170 and 'invested' all of it. Now he has $289. He can hardly believe it! What had he been waiting on all his life.
Trade 3... WINNER!!! This is just insane! On trade number 3, he decided to 'up the game' and 'invested' $500. Now his payout is $850! He is just in heaven. He thinks, I can do this every day? Just sit here and make money?
At this point, he KNOWS he is a real trader so he decides to take the profits out and just start with the house money he just won. He calls up XYZ binary options broker and asks to withdraw his funds. The person on the phone politely informs him that he has not made the minimum number of trades and to check the fine print. No worries, this guy thinks. I'm sure it is not a lot of money I have to make before I can withdraw my money. He decides to ready the fine print anyway...
What the #$%@!!!!!!?????? In the fine print, he is informed that since he took the bonus money, he is not eligible for a withdraw of any amount until he makes a total of $25,000 or a total of 1,000 trades.
His heart just sinks. He is determined though so he will see this through. "Ok Frank, All I have to do is trade like I have been doing and I will be up to $25,000 by the end of the month", he tells himself. He starts trading again and places a 'bet' quite larger than normal.
LOSS
He places another trade and it looks like a winner...12 seconds left.....8 seconds....woo hoo! This is gonna be a winner.....2 seconds left..... A price spike occurs. LOSS. What the #$#??!?!?! So Frank checks other charts. On other platforms there was no price spike.
He calls up the broker and demands to know why the price spiked at the last possible moment. The broker informs him that forex does not have a central exchange and that price spike do often occur on one broker and not another. Before getting off the phone, the guy on the other end offers Frank a special top secret deal. All he has to do to learn the "Secret no one knows about" is invest $1000 into learning the system that will produce more profits than he could ever dream. The guy is super convincing and Frank is getting ready to invest more money. The one drawback is that Frank doesn't have any more money. He still owes the payday loan place.
Frustrated, Frank hangs up the phone. If he could somehow come up with the money to invest to learn this top secret system. He thinks and thinks. Boom! He has it. He goes to his mom and tells her how much money he is making and convinces her to let him borrow the money. He can never tell his wife this though because she is becoming suspicious of this binary broker.
After promptly getting back home and waiting for his wife to hop in the shower, he calls up his binary options business. The guy on the other end gladly accepts his money and gives him the best speech Frank had ever heard. Frank quickly checks his email to learn this super secret system he just paid $1,000 for and he is happy because the $1,000 is still going into his account. It can just work to get to that $25,000 goal.
Click click. The email opens. He reads this super complicated system that has no entry points. It is all talking about stuff he can't even understand such as economic releases and interest rates. Frank is so upset. He is starting to feel like he is being taken advantage of. What can he do? His money is tied up and the super secret system is too hard to understand.
6 months goes by. Frank has tried everything. Those first 3 winners were just plain luck. He has ups and down and he still has $300 in his 'account'. He just wants out. He wants to take his money and run so he starts looking for someone to help him learn to trade. All he wants is to learn to trade. He has been bitten by the trading bug and his life is consumed by it. He loves trading but just sucks at it.
So he joins a popular face book group and learns that there are trainers in the group. He asks one of the trainers, " Can you teach me how to get my money out of the binary options business? I have an account but can't withdraw it."
The first words out of the trainers mouth are, " I am so sorry but what you are involved with has nothing to do with trading and your money is pretty much gone."
BLASPHEMY!!!!! Frank thinks and he goes to another trainer. He gets the same response. He tries a third trainer and gets the same response.
Frank soon learns that all of the "brokers" are not brokers at all. They are private businesses that are scams and designed to take your money. Many of these scams don't even place real money when you are placing trades. What you are trading is just a demo account because you will never see that money again anyway.
Frank learns that being regulated through some obscure "authority" somewhere means absolutely nothing. This is not real regulation. It's all just one big lie.
Frank learns that the only way to trade binary options is through a regulated exchange. That's it. There is no other way to keep your money safe. There is no other way to actually trade these.
The only places to trade binary options that are true and regulated are below
2. Nadex
3. IG