When it comes to binary options trading, many traders are focused only on one thing – making money. After all, binary trading is all about gaining profit on financial markets. There is not a single person in this world who doesn’t need money for their basic needs, and maybe even some simple luxury. This makes binary options so appealing – anyone can trade them.
Once the traders enter the arena, they find out how there are many brokers with many offers. One would expect that like in many other markets only the strongest would prevail and provide binary trading services, but unfortunately, it isn’t always so.
Popular niches like binary trading are very attractive to binary scams and frauds. They usually exploit the users’ trust in order to run away with their money. For this reason, regulation becomes one of the most important aspects of trading. There are some good unregulated brokers, and some badly regulated brokers, but all in all, one has to be wise when considers the brokers for trading.
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Binary Options Regulation in New Zealand
New Zealand has very regulated binary options market from the very beginning. The main agency that regulates this type of trading is Financial Markets Authority (FMA). In order to provide their services legally in New Zealand, brokers are obligated to get an FMA license and respect their rules of conduct.
There are some additional criteria for the broker who must have a physical office in New Zealand and staff employed in the country. Also, the funds must be completely segregated.
Binary Options in New Zealand are very regulated, and the FMA often publishes special reports regarding changes in regulation or warnings regarding bad and scam brokers. Some of the brokers regulated by the FMA are
FMA also invites citizens to report any scam brokers, frauds etc. However, brokers regulated in New Zealand are not allowed to offer their services to NZ customers.
Relationship Between Brokers, Traders and Regulators
As binary options industry grew bigger and bigger, it became part of the mainstream media news. One of the main reasons why it became so visible and present is the fact that binary brokers often do special sponsorships with popular sports clubs and celebrities. The other reason is somewhat less attractive, as it involves scams and frauds.
For this reasons, traders are often reluctant to trade binary options. However, the solution can be found among regulated brokers who provide an additional level of security, as they must obey certain rules. Traders who opt for regulated brokers can always count on some extra assistance provided by the regulator.
Regulated or Unregulated Broker?
Regulated brokers are brokers who put a lot of effort into making the binary industry a credible business. They provide all necessary information, develop additional security and implement new tools only to provide better service. Unregulated brokers can do so too, however, they lack legitimacy.
It is believed that in the future there won’t be any ‘middle road’ and that all good brokers will be regulated, while less good brokers won’t be regulated. That time is still to come, but brokers are more and more relying on licensed status as it adds great value to their brand.
Why to Select a Regulated Broker?
Traders often believe that license and status are completely irrelevant, as long as the broker gives them a withdrawal. This can be true, but one shouldn’t rely exclusively on that, as binary trading is more than making a profit.
Withdrawing is just the last step in binary trading.
Safety of funds, proper terms and conditions, realistic promises, and constant support are of great value and all come before withdrawing. This means that only when broker provides all these aspects of trading, withdrawing comes in mind, as only then the profit is generated.
Regulated binary brokers are more transparent, but unregulated brokers can be a good choice as well. It is, most of all, important to find a safe binary broker, and place trades according to your binary trading education.