Why Binary Options Brokers Have Huge Bonuses
Bonuses are a huge draw for many new binary options traders. Who does not want free money. If you do some google searching for bonus offers you will see a slew of ads shouting that they are willing to give you free money! Free money over here, free cash over there just step right up and here is all this free money!
If you dig a little closer on many of these websites you will see all these smiling faces talking about all this money they’ve earned by getting the right bonus and then following these bogus trading systems.
You can even see a TradeRush banner on the right advertising a $500 bonus to new traders.
The bonuses come with strings attached. The offers of free money or huge matches on deposits are because the broker knows that unless you are really good at trading binaries, or really lucky, that once you agree to the terms and condition of a bonus offer that you are less likely to withdraw your money than if you refuse a bonus. The truth of the matter is that these bonuses in the options trading arena remind us a lot like online casino bonuses. When you join an online casino, you’re typically offered a match bonus which you can accept or reject. When you register with a binary options broker and deposit money, you’ll generally be offered a similar match bonus.
You have a choice as to whether or not you accept the bonus money.
Why wouldn’t you accept free money? It all depends on your feelings about leverage, risk tolerance and your personal goals.
What is leverage? It means trading with more money than you have. When a broker offers you a bonus, it’s usually a leverage-based bonus and not a cash bonus. It means you’re offered the chance to control and trade a larger stake than you have in your account. This means you can potentially win or lose more money than you could if you were only trading with your own money. The idea is that if you do well and you are able to turn over the amount of the bonus a certain number of times (usually somewhere between 20 to 40, aka ‘rollover’), you are allowed to claim that bonus as cash, so in a way it’s paid off twice.
The converse of being able to win more money faster is that you can also lose more money faster and blow your initial deposit even more quickly.
So if you don’t feel comfortable with that kind of risk, you should probably reject a bonus offer. There’s nothing wrong with taking things slowly. And since you’ll be less likely to wipe out your account as quickly, you can probably make your bankroll go further and have more fun trading before you do run out of money. For some people though the bonus is part of the thrill of gambling, so you may want to accept it if that’s the way you do things.
Read The Fine Print – Rollover & Regret
How do you find out how the bonus works at a given broker? Usually there is a page for Bonus Terms and Conditions, or it might be under the general Terms and Conditions. This is where you’ll find out about a turnover requirement if there is one. You can also ask a customer service agent when you’re signing up for an account. Many brokers also offer other types of bonuses including referral bonuses which you can take advantage of to get actual cash.
We often list general broker deposit bonus offers, because a lot of gamblers visit this site and want to gamble at legit brokers with big bonuses. At the time of original publication you can even see a TradeRush banner on the right pimping a $500 bonus to new traders! It’s ok to be a gambler and get the bonus if that is what you want to do. I enjoy trading binaries for the thrill of the rush (they took away my online poker for the most part, you bastards!).
Just make sure you read the fine print and agree with all of the terms. The common types of ‘strings’ that the brokers may add to any promotional offer or bonus include:
- Agree to roll-over your deposit and bonus a set number of times. 20-40 times is common.
- Agree not to withdraw your initial deposit until you meet those roll over requirements
- Sometimes agree not to withdraw any of the bonus money at all, only profit made on the bonus money after rollover requirements
- Plus a ton more – and they are different at all brokers
- Find the terms and conditions page before making a deposit. Decide if the bonus is for you!
- Never invest more than you can afford to lose because it is risky and you can lose your entire deposit!
This is why we recommend refusing, rejecting and not accepting broker bonuses unless you are in it to have some fun gambling! (and there is nothing wrong with that!). When traders accept bonus money without really understanding what they are getting in to it is their own fault. Know that any marketing arm of any company is going to sell you on the sizzle and minimize the negatives. The trusted brokers we list all have their terms and conditions linked easily enough to find from their home page or their bonus offer page. See those brokers here.