If you follow the latest publications on the web-site attentively, you will easily agree that binary options have many advantages over more conservative tools for trading. But every medal has its reverse. Let’s consider the disadvantages of binary options and try to determine the pitfalls that can be expected by a trader during the binary options trading.
Lack of demo account within binary options broker
One of the most obvious and widely discussed on the web disadvantages of the binary options trading is the lack of a demo account within the serious brokers. This disadvantage is inherent not only to the Russian market. The same situation is observed with the English-speaking brokers. This fact annoys traders rightfully and exposes them to the additional risk related to the trading using the unfamiliar system without the preparatory testing. In excuse of such brokers it is necessary to note that the long-term research undertaken in a currency market proved that there is not less and sometimes even more harm from the usage of demo account. And especially it can be seen among the beginners in trading. This issue is considered in more detail in the article Binary options: demo account.
Absence of a demo account in the binary options trading plays into the hands of the numerous bookmakers’ offices that are hiding over the names of brokers and often commit fraud against many trustful traders. These offices provide demo accounts aiming to rope in the beginners. Of course, demo accounts of such brokers are being regulated by them and traders manage to earn virtual money quickly. Unfortunately, transition to the real accounts finishes with a total loss of a deposit.
Currently, the leading brokers try to provide traders with the tools that substitute demo account and allow traders to close the first deals at the expense of a broker. Among such brokers we can mark Dragon Options with its unique bonus scheme and riskless deals. Dragon Options is not the cheapest broker for the beginners, but certainly the reliable binary options’ broker.
Poor analysis tools
Of course, each trader who faces the platform of the binary options broker for the first time immediately notes the imperfection of the charts’ system and absolute lack of tools for the technical analysis. However, here you have to bring claims to the developers of a platform and not to brokers. But it does not change the point because binary options traders are forced to trade almost randomly and it has a natural impact on their trading quality. The experienced traders can easily avoid this problem using external informational sources. For this reason, if you are the beginner in trading, we recommend using our binary options charts. Live quotes and the extensive selection of indicators will help you to work with the broker’s platform.
Lack of mini and micro accounts
Unlike Forex, where traders can open cent accounts and trade with minimum amounts, in the binary options’ market the minimum stake amounts to $10-$25. It complicates the efforts of traders with a small deposit (for example, $100) to follow the strategies of the capital’s management. Of course, the experienced traders are not interested in such accounts and deposits, but the market consists not only of the professionals. For this reason, lack of micro accounts within the binary options brokers is a disadvantage.
As you can see, if a trader takes trading consistently and rationally, pitfalls ahead of him in the binary options trading are not so terrible. In this case, trading with binary options will become truly worth and profitable business. In conclusion, we would like to note that the binary options’ market is a fairly young and growing pains are inherent to it. It is to be hoped that all these disadvantages will be eliminated sooner or later and the binary options trading will become perfect.