Some binary option brokers have very alluring bonus offers for new sign-ups. Choosing a broker because they offer a big welcome bonus is not something we recommend, for several reasons. Read on to find out more about binary option welcome bonuses, how they work, and why it is healthy to be a bit suspicious of them and always read the fine print before accepting anything.
Do not be lured in by a bonus
Getting a welcome bonus can be great, but simply going with the broker that offers the biggest welcome bonus is not a recommended method for selecting a binary options broker. In the long run, other aspects will have a much larger impact on your profits as a trader and also on how much you will enjoy your trading experience.
You should pick one of the brokers where you have the best chances to become a profitable trader, based on your own preferences and trading strategy – not the broker who wiggles the largest bonus offer in front of you to get you through the door.
Understandably, binary options brokers do not want you to sign up, make a deposit, get the bonus, immediately withdraw all the money, and then leave to never come back again. They want you to become an active trader on their platform. Therefore, welcome bonuses come with various trading requirements.
You need to read the fine print to find out exactly what these trading requirements are, because they can vary significantly. Some brokers have fairly sane requirements, while others…not so much.
A trading requirement is typically expressed in relation to the size of the bonus, and will require you to risk that amount a certain number of times before you can make any withdrawal from your account. With many brokers, everything you have in your account will stay there until you have fulfilled the requirement – including deposited money and any profits from trades. So, it is not just the bonus amount that gets locked in.
If you don´t want to receive a binary options bonus, contact the customer service and clear it with them before you make your deposit. That is much easier than having to wait for them to remove the bonus before you can start trading. (If you do start trading while the bonus is still in your account, they will not remove it. Some brokers are even pesky about removing a received bonus before you have started trading.)
If you hesitate to decline the welcome bonus, ask yourself: Would I sign up with this broker even if there was absolutely no welcome bonus? Or is it the idea of ”free money” that is luring me in?
Bonuses to losing traders
Some brokers have a habit of throwing big bonuses in front of traders that are losing money. Brokers don´t want these traders to give up and stop trading, so they send them ”generous” offers of big deposit bonuses – with trading requirements, of course. When you have just lost almost everything in your trading account, it can feel very appealing to make a new deposit and get your hands on that big bonus.
No deposit binary option bonus
A no deposit bonus is a bonus that you get without making a deposit.
This can be fun, but you should read the fine print before you accept the bonus. A no deposit bonus will typically come with a trading requirement, and fulfilling this requirement without actually putting more money into your account first is likely to be very difficult.
In many parts of the world, binary options brokers are no longer permitted to give out binary options bonuses. Such a bonus can also be a violation of the rules stipulated by the applicable license authority.
Regrettably, scams do exist and some fraudsters use big welcome bonuses to lure in unsuspecting victims. They hope that the victims will be so mesmerized by the big bonus that they neglect to do their due diligence or notice any red flags.
Exactly what the scammers want vary. Some just want your first deposit, while others work more of a long-con. There are also those who are interested in your personal information to carry out identity theft and similar frauds.
Binary options is a kind of relative to financial spread betting, and financial spread betting have links to the casino & sports betting industry. It is therefore not surprising that some binary options bonuses have terms and conditions that are very similar to those attached to your average casino bonus and sports betting bonus.