The number of binary options trading platforms has expanded massively over the past five years. Despite being a fairly new way to trade financial markets, the throng of brokers and available platforms demonstrates the growing popularity of binary options amongst both new and experienced traders. Beyond the traditional higher-or-lower binary options, the emergence of new features and tools diversifying the way that binary options can be traded is a direct result of the competition between platforms and the necessity to innovate to stay ahead of the rest.
What do different platforms offer?
There are a number of leading binary options software providers who serve some of the largest binary options brokers in the industry. For this reason, many platforms have adopted a similar interface and design making it difficult for new traders to differentiate between the services that they offer. Unlike spread betting or forex brokers, binary options platforms cannot compete on commission-based promotions such as low spreads and trading costs as these do not exist in binary options. The principle way in which platforms can compete is in their percentage pay-out for in the money options and also in the features that they offer.
Analysing the potential returns that the platforms offer is fairly straightforward and many share a similar pay-out range of 75-85% for in-the-money trades. An additional factor which can be taken in to consideration is the ‘insurance rate’ that a platform may or may not offer. This is the percentage that the platform will return to the trader for positions which close out-of-the-money. This value can range from zero to a generous 15% and is an important consideration for those looking for a long-term trading relationship with a platform.
Features provided by different binary options platforms
Binary options trading platforms not only compete on pay-out levels but also on the range of features that they provide to traders. These include a number of alternative binary options from the simple higher-or-lower format and can provide additional profitable opportunities for traders. Some or all of these features may be included by the large binary options platforms and typically include the One Touch, Sixty Second and range trading tools. One touch trading is a useful feature for those who look at longer term price movements and can read the price charts to ascertain where price may be heading by analysing the underlying trend and areas of support and resistance. Furthermore, platforms that offer One Touch trading, where the price simply has to touch a predetermined price within the lifetime of the option, can offer this at the weekend allowing those unable to trade during the week the ability to trade outside of normal market hours.
Sixty second and range trading tools
Sixty second trading is something that has grown in popularity as one of the fastest ways to profit in any form of financial speculation. It is offered by a number of the large platforms and it is an essential tool for those who both enjoy scalping the markets for short-term profits and who are comfortable generating fast profits. Range trading features, on the other hand, can be traded over a longer period with the trader essentially betting on whether price will remain within a certain price range, therefore the options which close within this range will be profitable.
It is obvious that the provision of these features offer additional profitable potential for traders and they are an important consideration for traders in choosing a binary options trading platform. They also offer alternative trading strategies in different market conditions with One Touch and Range trading tools being most effectively used in volatile and flat markets respectively. Sixty second binary options may not be for everyone but offer an exciting and highly profitable tool for experienced short-term traders.