How to choose a good broker for effective trading

Minimum Stakes

As we explained in our guide, binary options are a highly speculative asset class. Therefore, it is best to start with really low stakes until you feel more comfortable. Most binary options brokers allow you to wager as little as $1 per contract, which is ideal. However, we have also come across platforms that install a minimum trade size of $100. While this may appeal to the high-rollers of the binary space, it is not suitable for newbies.

Profit Percentages

You also need to know exactly what winning percentages are offered. For example, the industry standard in binary options is a maximum profit of 95%. So, a bet of $1,000 would result in a maximum payout of $950. However, some binary options brokers offer lower win rates - possibly in the 70% to 80% range.

At the other end of the spectrum, we have also come across binary options brokers that offer a winning percentage of over 100%. Remember that as the winning percentage increases, the probability of your bet ending up in the money decreases.

Competitiveness of strike rates

Based on the above section, you also need to evaluate the competitiveness of the strike rates offered by the broker. Suppose you are trading binary options on Facebook stock, which currently has a price of $129.

•     Two individual brokers offer a profit percentage of 80%
•     Broker A has a long strike price of $134 and a short strike price of $124
•     Broker B has a long strike price of 138 USD and a short strike price of 120 USD.

Which of the two binary options brokers do you think is more competitive? Well, this would be Broker A. The reason for this is that even though you get a winning percentage of 80% on both platforms, Broker B requires Facebook shares to go to 138 USD for long positions and 120 USD for short positions. Broker A, however, only requires a strike price of $134 / $124 to be in the money, which will be much easier.

Educational and research tools.

Although research tools have limited use when trading binary options with super-short expiration dates, they can be very effective for longer trades with CFd in Exness broker. For example, if you are trading binary options with an expiration date of 6 months, you would want access to a number of technical indicators and chart analysis tools. It would also be useful if the binary options broker provides basic real-time news and ongoing market analysis. In terms of education, we prefer binary options brokers that cater to novices. This should include a series of practical videos and blogs, step-by-step tutorials and even regular webinars.

Customer service

It is also important to choose a broker that offers top-notch customer support. Since binary options are usually traded around the clock, you should use a broker that providers round-the-clock support. This should be in the form of live chat, email and phone support.

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