Rating of binary options brokers represents the effective help to the traders while choosing a company with proven reliability. GuruTrade brings to your attention an independent Rating of binary options brokers which estimation statistics has been created by the team of experienced specialists on the basis of public information and official data including date of company creation and the exhaustive list of offered services.
Method of Binary Options Brokers Rating Calculation
To calculate the Rating of binary options brokers on GuruTrade was applied a complex method which is based on 16 characteristics with score estimate system. This calculation procedure allows to estimate objectively each broker and to provide to the traders reliable and impartial data on the basis of which they will be able to make the independent decision for the benefit of the brokerage company.
For each Rating parameters there is the following scoring technique:
1. Service period of company
Scoring is performed for every year of a company activity from the moment of its creation:
- 1 year = 5 points
The more years of professional activity have the company, the higher will be a score (2 years - 10 points, 3 years - 15). It is an open secret that the companies which worked in the market longer, enjoy bigger popularity. Many traders give the preference to such brokers because the reliability of the company increases with every year of service.
2. Regulating authorities and control of company activity
Assessing the regulating organizations exercising control of binary options brokers' activities the priority if offered to the American and British state regulators:
- CFTC = 50 points
- FCA = 50 points
- FINRA = 50 points
- FSA = 50 points
- NFA = 50 points
- SEC = 50 points
- SIPC = 50 points
- CySEC = 40 points
- FSP = 30 points
- FFMS (Russia) = 20 points
- CRFIN (Russia) = 10 points
- KROUFR = 5 points
It stands to mention that the main offices of regulated brokers should be situated in the country of their registration. For example, brokers who are regulated by the CFTC and NFA should have such offices in the USA.
3. Binary options brokers’ offices and branches
The more offices and branches in different countries have the company, the stabler and authoritative it is considered:
- Countries within CIS = 1 point
- Foreign countries = 2 points
When a company opens new representative offices in foreign countries, it carries out services and features modification, adapting them (if it is necessary) under the national legal system of the state.
4. The maximum percentage of profit
The size of the largest possible profit percentage is an important parameter for each trader:
- From 80% to 89% = 5 points
- From 90% to 95% = 10 points
- From 96% to 100% = 15 points
- From 101% and more = 20 points
If the broker has a higher profit percentage on classical option, he gets more rating points.
5. Option type
Different types of binary options distinguish both on expiration time, and on the targets of the transactions made on them:
- For each type of an option = 20 points
Expiration period of options can vary from 60 seconds to 3 and more days, and the transaction target can consist in forecasting a price touch of a certain level, the direction of price movement from basic value or price comparison of two assets.
6. Number of payment systems
Considering all varieties of billing aggregators, each trader personally chooses the most convenient and habitual method:
- Each payment system = 10 points
Expanding the list of available payment systems, the broker creates for the clients more favorable conditions of making cash transactions, thereby involving new traders.
7. Demo account availability
When the broker company offers a possibility to practice on demo (virtual) account before opening a real one, some points will be added to the broker's rating score:
- Demo account availability = 30 points
If it is your first attempt of binary options trading, then for a start it will be better to check the forces on a demo account. Binary options brokers offering such opportunity will be in a priority at the beginners.
8. Mobile application availability
Some traders prefer working without tying themselves to a certain workplace. The mobile applications which are a product of the most progressive technological developments will provide them this opportunity. The broker companies having mobile versions of trading platforms receive additional points:
- Mobile application availability = 10 points
The main advantage of a mobile application is the simplicity of use, availability of all functions necessary for trading, and opportunity to trade from any point of the world with Internet access.
9. Trading contests
The broker company organizing various Forex contests offers everyone a chance to approve oneself in trading competitions and to win a cash prize:
- Each active contest (in any language) = 10 points
Participation in contests is useful for the trader to develop a trade skill and to get the experience, applying the various trading techniques. The contests offer the possibility to earn money for real trading without spending your start capital.
The concept "bonus" means that on the trader's real trading account is transferred some cash. Bonuses share on two main types - deposit and no deposit:
- For each type of bonus = 10 points
Sometimes brokers offer other types of bonuses, for example, annual interest rates charge on the part of not used deposit or payment of prizewinning means in the case of a victory in the competitions held by the company. The competition prize can be enlisted as a non retrievable bonus, fulfilled bonus, and in certain cases as the cash which is available for withdrawal.
11. Educational programs
Forex training can be useful not only to beginners but also to their more experienced colleagues in order to increase their professional level:
- Educational programs availability = 10 points
The various training programs and interactive lessons might help market participants to learn new information about trading and to apply it to the trading strategy.
12. Compensation availability
To stimulate the clients' trading activity some brokerage companies provide the compensation of payment systems charges:
- Compensation availability = 10 points
For the trader, the collaboration with such company will be more profitable because it will allow to cut down its expenses due to compensation.
13. Automatic withdrawal availability
The broker which has an automatic withdrawal system saves to the clients their personal time and creates more comfortable conditions for making money transfers:
- Automatic withdrawal availability = 50 points
The system of automatic withdrawal allows to reduce money transfer time for 1 minute, but the request can be performed not only on working days, but also on weekends and holidays, and at any time.
14. Number of available trading instruments
The wide choice of trading instruments allows traders realize trading strategy in full measure and to increase the invested capital:
- CFD = 30 points
- Metals (gold/silver) = 20 points
- Tools of Forex group = 10 points
- Commodities = 10 points
- Stocks = 10 points
- Indices = 10 points
The more various is the set of tools, the more convenient to select those instruments which will bring the biggest profit.
15. Positive and negative reviews about binary options brokers
Reviews about the work of a certain broker which are published by clients, are estimated as follows:
- Positive review = + 1 point
- Neutral = + 0,5 points
- Negative review = - 1 point
In the network, the trader can meet various reviews about the work of brokerage companies - from frankly negative to excessively laudatory. The trader should remember that he can completely trust only his own experience and to treat any read comments extremely circumspectly.
16. Website evaluation
The official site of each broker is his business card. On pages of the official Internet portal of the company the trader can find all data, necessary for work: trading conditions, contract specifications, contacts of the support service and a lot of other useful information. Taking into consideration the importance of the matter, the GuruTrade team added to the Rating of binary options brokers additional criterion - "Website Evaluation". In the assessment, it is considered: functionality and convenience of site navigation, the efficiency of Support service answers, the simplicity of necessary information search and others. These parameters are estimated on the following scale:
- Availability of information = from 1 to 13 points
- Trading conditions = from 1 to 12 points
- Online support = from 3 to 8 points
Every trader who takes the first steps in binary options trading meets the task to find a reliable broker. We are sure that information collected by the GuruTrade team will give you an effective help and will allow to choose the best broker for collaboration.