Thursday, October 25, 2012

Do Binary Options Trading Sites Give Free Money?

One would think the question, "Do binary options trading sites give away free money" would be an obvious "No!" but there still seem to be people out there that think that is the case. While many (read: most) brokers DO offer some form of trading incentive (usually in the form of trade credit money) - it does not constitute free money given away. Despite the claims and appearances of some sites - those cash incentives have to be earned.

How Are Cash Incentives Earned at Binary Options Brokers?

The right question people should ask when trying to choose between similar cash incentive offers at one of the leading binary options brokers is, "What do I have to do to be able to withdraw the bonus cash?" Therein lies the devil in the details, so to speak. While a new trader might be promised a 50% bonus over and above their initial deposit amount they should be prepared for the fact that the deposited funds and bonus cash will not be free for immediate withdrawal.

This has obviously caused more than a few traders to panic. Fear not however for most brokers make it pretty simple to free up the cash: trading volume. All a new trader has to do is execute enough volume of trades to have full withdrawal rights to the bonus cash. Sometimes the hurdles can be a little on the steep side but by and large the trading volumes are not onerus. A site might expect a trader to generate anywhere from 15-30 times the amount of the bonus reward in contract volume - which for most traders happens within the first couple of weeks of placing trades in their account.

How to Get the Most Free Money from Binary Options Trading Sites

Top Cash Incentive Offers:
  1. OptionBit
  2. TradeRush
  3. EZTrader
We started the post at the outset with the caveat that cash incentives at binary trading sites does NOT constitute free money - so we're drilling that point home here. There is NO FREE MONEY at binary brokers OK?

Now having said that, most cash incentive offers are tied to the level of deposits made by the new client. The higher the initial deposit, the higher the cash incentive percentage. A typical offer might involve something like $100 bonus for a $500 deposit with a $300 bonus for $1000 up to something like a $4000 bonus on $10000 deposited. The bigger the trader's initial funding commitment, the bigger the cash incentive. Does that make sense? Other binary bonus schemes exist but this is the most typical setup.

Bonus Cash at Binary Trading Sites Is NOT Free Money!

We have to remind people that, once again, bonus cash given by binary options trading sites is not free money. The bonus amounts above represent cash that new clients can withdraw once they have reached trading volumes in their account above a set threshold as set by the customer terms of service at their broker. A trader who received a $100 bonus can expect to have to generate volume on the order of $1500 in trades (placing essentially 3 trades using their $500 stake) in order to free up the $100 bonus for withdrawal.

Seriously think about it though: If binary options trading sites were giving out free money that could be immediately withdrawn... exactly how many of those sites would still be in business today? The reality is that all cash gifts in the financial world come with strings attached... so set your expectations low and hopefully things will work out for the best OK?