Binary Options Trading In Australia: How Safe Is It?

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Binary Options Trading In Australia

The European regulators recently clamped down on binary options trading and contract for differences (CFDs) in the region. Markets regulator European Security and Markets Authority announced that they will ban the sales of binary options to small investors, as well as restrict CFD sales.

This move aims to protect the European investing public, especially retail investors. The authority noted that these new measures will provide minimum investor protection when dealing with these products. According to them, the complexity and lack of transparency of binary options and CFDs is what makes them a risky undertaking for investors.

Binary Options in Australia

In Australia, binary options trading has been getting negative publicity recently. In early March 2018, a couple in Perth were identified as operators of an unlicensed binary options company called Binary Tilt. The Australian Securities and Investments Commission (ASIC) earlier warned the investing public not to deal with Binary Tilt because the company “could be involved in a scam.” Binary Tilt has received several notices and warning from regulators in Canada, the United Kingdom, Japan and South Africa.

According to an Australian Broadcasting Channel report, some investors who dealt with the company said that they could not withdraw any of their money after they made the investment. The company kept on reneging on their promise to pay.

ASIC for its part has been strictly regulating binary trading businesses which fall under its jurisdiction. They also actively issue warnings about trading in binary options using mobile apps. One such warning says: “Always check that the entity (behind the app) is licensed to trade binary options in Australia on ASIC’s Professional Registers.” Learn more about trading option in Australia from finaria click on this link

The case against the Perth couple is ongoing, as both are denying that they owned Binary Tilt and had control over it.

Room for Fraud?

Another ABC report featured a former employee of a binary options trading company based in Israel. When Shlomo Blitz was working for the company, he said that he was party to defrauding people of their hard-earned money.

He also claimed to have targeted people from Australia as well as other nations such as New Zealand, Singapore, Malaysia, America, and Canada. Hiding under the fake name Scott Martin, he was able to convince them to invest.

When asked how he would go about selling binary options, he said that it was as simple as telling the potential investor that returns will be big and will be quick. However, one’s hard-earned cash would have evaporated into thin air the minute it was invested.

Because of these instances, one should not take investing lightly. Information is the only weapon one needs to prepare for battle, so to speak.

Do Some Research Before Taking the Plunge

ASIC itself considers binary options as a “high-risk” and “unpredictable” investment option. Usually, pay-off in this financial option can be cash/assets or nothing. Investors have 50/50 chance of losing money. This is the reason why regulators liken binary options to gambling.

In Australia, regulators see to it that anyone who runs a finance-related business is duly registered and accredited. This is the best way to see if a company one is eyeing to help in their investments has the authority to do so.

Aside from government regulators, potential investors can also rely on experts in finance who take it upon themselves share information about investing. Doing a quick search online will show different websites that offer these kinds of useful information.

How Reviews Help Promote Safe Buying

Reviews normally highlights the company’s background, especially mentioning its registration with ASIC and how long it has been in operation. Being under government regulation is an important factor of a good broker. Brokers are then described based on what advantages they can offer to investors.

Reviews, especially with these much detail, become powerful tools for the ordinary retail investor. Ordinary Australians who want to put their hard-earned money in the trading sector, or even serious traders who want to improve their ‘game.’

Non-legitimate brokers tend to perpetrate scams that trick people into buying into get rich quick schemes. Government and experts provide a closer and more critical look into these brokers. Getting the right information at the right time remains to be the best defense for the trading community.

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