There are several common binary options promotions types that are all made to attract traders and to assist them usually when they only start trading. Binary options brokers need traders to perform many trades and generate a large volume in order to remain profitable. Binary options brokers use promotions as one of their marketing tools to get new traders join their platform and become active traders, which in term, increases the broker’s portfolio and grants the broker better margins and better deals. The more experienced traders that profit from binary options trading for years do not need these bonuses because they invest enough money to use their own money to generate the volumes and the profits.
Binary options promotions – bonus
The bonus promotion is usually a deposit bonus which means you get a bonus for certain deposits. Usually if you deposit an amount that indicates you are serious about trading and not just someone that came to play with trading, you can get very significant bonuses, sometimes more than 100%. For example, EZTrader, which is a great broker we work with, gives Binary Options Academy users 100% bonus on every deposit of 1000$ you can register here. 24option also gives Binary Options Academy users 100% bonus for every deposit of 3000$ when you register here and tell your personal account manager you are eligible for the 100% bonus.
There are two types of deposit bonuses, the first one is the redeemable bonus and the second one is the leverage bonus. The redeemable bonus gives you the money to trade with and when you generate the required volume the bonus money is yours to keep. That means that if you deposit 3000$, you get 3000$ and when you generate the needed volume you earn 3000$ for free with no relation to the trades you have made. The leverage bonus is a bonus that gives you the ability to place higher bids and to trade more with money that the broker allocates to your account but serves more like a loan because you cannot withdraw the bonus money. There are many traders who do not know to appreciate this bonus unfortunately but for the amount of 500$ you get to trade and practice as if you have 750$ for example. It means 50% more trades to practice for the money you deposited.
Binary options promotions – free demo account
The free demo account promotion is targeting people with no trading experience at all that are not really ready to trade and therefore want to “try” trading virtually. We always say in our courses that trading in a demo account is like playing monopoly, it is fun but it has nothing to do with real trading just like monopoly has nothing to do with real life real estate management. The demo account misses the purpose of trading practice because people tend to play with demo account just like playing in a casino. Therefore users tend to get no practice from the demo account and usually lose all the demo money very quickly depending on luck rather than analysis.
The free demo account is also problematic because all the emotional aspects of trading real money that can influence our decisions just do not exist in virtual money. The first practice trades may cause losses and therefore we recommend to start trading with small trades to gain practice and experience before moving to bigger trades but using a demo account just doesn’t provide the practice needed.
Many of the people that use a demo account don’t move to be traders and therefore the only relevant case where a demo account is acceptable is for youth that desire to learn more about trading and cannot legally open a real account.
For people who consider opening a demo account, it is better to open a real account for the minimum deposit and try and get as much education and practice from the investment funds and to decide if to deposit more. Many of the people who use demo accounts miss the opportunity to generate real money profits and to learn about binary options trading.
Binary options promotions – trade insurance
The trade insurance promotion refunds the trader’s account for a predefined amount from the first losing trade after the trade insurance was granted. There are many kinds of trade insurances and in most cased the refunded money is actually a bonus which means it only becomes the trader’s money in some of the cases. The benefit of the insurance for beginner traders is to still get money in the account’s balance to make more trades and more trades always mean more practice.
After reading the binary options promotion types you can view the best binary options promotions or register with these excellent brokers for great promotions especially for Binary Options Academy users: Plus500, 24option, EZTrader, OptionsClick, and XPMarkets.
It is always recommended with every promotion you get to read the terms and conditions and understand exactly what you get and in what conditions you get it.