It is natural when making comparison between binary options intermediaries to outline firstly the quality of services they render based on diverse criteria. One of standards which soon will have significant meaning for sifting the grain from weeds in the binary options industry will be the license for provision of investment services.
The understanding of distinct business models under which financial companies operate will be another useful tip for identifying of a proper to investor’s needs binary options broker .
Have you ever asked yourself is there any difference between binary options brokers?
Basically, all investment companies can be divided in two groups. The first one is this of intermediaries, regulated by financial supervisory authorities. The second one includes non-regulated firms.
Regulated brokers by presumption should guarantee the aforementioned quality of services to investors, since they are obliged to follow all procedures and to report continually to supervision institutions. In turn, all supervising authorities are organized and function with one basic aim to protect investors’ rights.
Without meaning in which part of the world one financial company operates, it is obliged by the law to obtain a license in case it offers certain investment services. In different countries the legislation framework varies in terms of capital requirements and licenses’ fees for different types of brokers.
The regulated binary options broker is nothing else than an investment intermediary. Thus, for the provision of some services and activities under financial instruments laws they need to obtain a license from the respective financial supervision commission.
Possibly, some active binary traders may put under question the above statement, since currently the binary options industry includes many companies for which it is difficult to say that they are regulated entities. Perchance, some of them are offering not bad binary options services.
Favorably, for rendering of some financial services financial laws do not require binary brokers to be licensed. Still, in some countries these financial companies are obliged to inform supervision authorities and to submit intentions that will operate in within the binary options industry, which makes them again, regulated bodies. Most often, these binary brokers are required to have an agreement with a licensed binary options market maker.
Disclaimer:
The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.
