In previous years, price charts were verified by options traders in their favour. Financial experts came in and stopped these operations. But the brokers have found new ways to take the traders’ capital. Well, online platforms are designed to make money for their owners, however, there are legitimate strategies such as spreads, and there are not so legal ways as well. The fraudulent brokers have a variety of tricks to get extra money from you and keep it in their pockets.
Here are three common ways they do it and the tips on how to protect yourself from it.
Encouragement to fast trading
This method plays on human emotions. Greed, above all.
The markets are often targeted by traders who want to make money quickly. One way to do it is to trade short positions, 60 or even 30 seconds.
The brokers realise how difficult it is to know where the markets are going in a time of 60 seconds. A 1-second fluctuation can render a trade against you. And with price fluctuations that occur every millisecond, it is highly probable you will end up losing. Each 1-minute loss of your income means additional cash for your broker.
Commissions for trading
Any trade that you make attracts a little fee, whether you accept it or not. Consider an option with a return of 75 percent. Where is the remaining 25% going? This “secret fee” is what the broker earns. Note, that many brokers offer 1-minute trades. If within one minute 100,000 winning transactions are made, the 25 percent fee is enlarged accordingly.
You can not stop commissions, but, by trading slightly less, you can be sure you will pay less in fees.
Numerous brokers with online options offer the traders a chance to exit before the deal expires. Certainly, if the transaction is failing, you won’t regain all the original investment. You would only get a tiny portion of it. The rest of the amount surely goes to the broker.
It is recommended to use the early exit option with caution. If there are still chances it will end up well for you, wait. If you end the transaction before the time you will receive only a fraction of what you could earn. However, if a trade goes against you and you know that the situation will not turn around, exit before the expiration. Like this, you will lose less than if you were waiting until the end.
What you can do to defend against these three tricks?
Patience is one crucial word.
High-level trading is a game of patience. In order to verify the performance, you need to patiently test trading strategies on the Binomo practice account before using real cash.
I always suggest opening positions for five minutes or longer. You will then have time to evaluate the charts carefully before the correct trading conditions emerge. Best traders are studying the price charts for hours anticipating the optimal conditions. At first, it can be quite difficult. Even if you have made a good review and have implemented a great approach, you will find that not all your trades are the winners.
Next, it is impossible to stop the fees. But by opening fewer transactions, you can make sure you pay less in fees. You will also earn the time for more precise analysis so when more powerful trades develop, you will be able to keep a significant portion of your profits.
Lastly, avoid leaving the trades too early. When you take part in a deal that lasts 5 minutes or more, you do not have to be overly worried about the markets. Long-lasting positions ensure that you will not have to abandon a successful trade often.
I hope your trading will go smoother with these few tips I have shared in this article. If you have any comments, kindly share them in the comments section below.
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