How to Spot a Scam Broker?
Tuesday, December 24, 2019, 6:00 AM | Leave Comment
Although online trading has been around for years, many people still don’t seem to be able to overcome the fear of allocating their money to an account dedicated to that sort of activity.
It’s understandable, really, because if you don’t know what you’re doing there IS a chance you come across some scam broker and never see your money again.
However, these things are not that common these days, and the market has pretty much made sure that the best and most reliable brokers stay afloat.
Still, for your peace of mind and for your own safety, here are a few tips on how to spot a scam broker.
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Why do I need brokers?
First, let’s go through the basics for those of you who are new to all of this. So you’ve heard about people investing in things like Bitcoin online, or in binary options or something else like that and you want to get in on the action because the profit seems good.
Well, to be able to trade you will need a broker – an intermediary between you and the market. It’s all very simple, really: you go to a broker’s website, you create an account, make a deposit and then go to the trading platform and make your investment. If your prediction turns out to be correct, the investment with the profits is returned to your account balance.
The problems with usually start when you try to withdraw the money. Scam brokers will either put some impossible conditions you have to meet in order for the withdrawal to go through or they will ignore you entirely. They will sometimes even go so far as to contact you and try to get you to actually make another deposit and allocate more money to your trading account. Many people fall for this because they don’t suspect anything and by the time they make the new deposit it’s already too late. That’s why you need to know how to determine which companies are legit.
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Which brokers are scams?
The most important thing to look for in a broker from a security perspective is their license. If they don’t have it, don’t even bother researching them further. These licenses are issued by the relevant financial authority of the country the broker operates or is located in and represent an official statement by a (usually governmental) organization that a company is reliable and that it has met all the necessary standards.
Some brokers may even have licenses from several different authorities, which certainly backs up their claims that they are legit quite nicely. However, some of these licenses may come from somewhat exotic countries where the financial laws are a little less stringent, so don’t stop digging when you see that a broker has a license. Besides, licenses can expire.
A nice trick to check for a scam broker is to try to contact the support, especially if they have a live chat. If they repeatedly fail to answer, that’s a pretty good indication that they’re not reliable. I say repeatedly because you have to take into consideration that all agents may be busy at the time you’re trying to get in touch or that, if you’re contacting them from a different continent, you may have initiated the chat outside the support team’s operating hours.
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Which broker to choose?
Apart from that, however, you can pretty much rely on the market these day. Enough time has passed since this type of trading was introduced that reliable brokers have become widely recognizable. In other words, if a company is big and popular and has been around for years – it’s legit.
An excellent example of that is IQ Option. This broker has years of experience under its belt and has always kept track with the latest trading trends and regularly expands its offer in order to provide its clients with new trading options. It is widely regarded as one of the best brokers in the world, not just because of the selection of assets it offers (cryptocurrencies, stocks, indices etc.) and its technologically advanced platform but because it has really low financial requirements.
You see, while other brokers will ask for about 200 dollars from you for your initial deposit, IQ Option only asks for 10. In addition, you can make investments of a single dollar on their website, which means that you can approach trading quite casually if you so desire. Naturally, you can invest more too, but the point is that this company makes trading available to everyone.
Of course, there are absolutely no problems with withdrawing money from your trading account, the support team is excellent and the broker is fully regulated. All of this has made IQ Option the leader in the industry today, and if you’re looking for a way to start trading opening an account with them is just about the best thing you can do.
Conclusion
In the end, if you want to start trading online, don’t be afraid – there are plenty of trustworthy brokers out there. If you want to be absolutely certain that you’re trading with a real deal, just open an account with one of the most popular brokers because they have already firmly established themselves as top options in the industry. You will be able to find these companies after a short Google search if you don’t know any of them, but the example given above is certainly one of the best ways to get started.
If, on the other hand, you decide to check out some options that are not so popular, always keep in mind that they have to have a valid license issued by a regulatory body. After you see that they do, you can continue researching them further. In any case, if done with the right broker, online trading can be fun, exciting and potentially very lucrative. Good luck!
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Max Rothstein has been a part of binaryoptionstrading-review.com for years now and has reviewed countless brokers dealing in all types of online trading. He has encountered scams and legit companies alike and is a great person to turn to if you need advice on this topic.
