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  1. #1
    johnbenjamin's Avatar
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    Cool Binary options... a more acceptable alias for gambling?

    I recently came across this rather old article in Forbes that was written way back in 2010 which kind of reflects on the 'Binary Options Industry'. The author's perceptions are quite remarkable and I for one wouldn't know whether to agree to that or not.

    Here's the resource from forbes: http://blogs.forbes.com/investor/201...inary-options/

    Going by the comments in the article, not many agree that binary options is another front for gambling but requires a more serious approach with knowledge of the markets. While there is a bit of truth to it, most affiliate managers from binary options turn to getting a share off the pie from gambling traffic.

    Having said that, given the recent developments with pokerstars et all, in one of the linkedin forums I came across a post from a marketing manager from a fairly decent options trading brand, soliciting affiliates to switch to binary options so they can continue sending their US gambling traffic to this binary options provider.

    Personally I fail to see how a visitor searching for blackjack deals for example would even think of depositing on a binary options website, let alone click.

    Would like to know what others here think on this. Are there any affiliates who have actually incorporated options trading banners/content into their existing website and seen any results or did you have to set up a different website for this.
    Regards,

    John A. Benjamin

    Forex Affiliate marketing? Join our forex affiliate forums

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    Got a bunch of domains with binary options keywords in the actual domain name. Still unsure exactly what binary options are myself so I doubt BJ players no any better than me.
    Simon Eaton - Online marketing consultancy with 20 years experience

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    netresort is offline Private Member
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    I recently came accross to a great article Response to the Forbes ĎDonít Gamble on Binary Optionsí Article

    I think this will explain all your questions in this thread

  5. #4
    woja is offline Public Member
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    Stock trading and regular options trading are just as risky as binary options. The biggest difference is that with binaries the odds are not 50/50 as the payout is always slightly lower than the risk of loss (usually 100%).
    However, if a regular stock option expires out of the money it also becomes worthless and warrants a 100% loss.

    One thing however is that the alure of binaries is that you need to make a much smaller investment that regular trading in order to reach a higher payout.

  6. #5
    -Shay- is offline Public Member
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    Quote Originally Posted by woja View Post
    Stock trading and regular options trading are just as risky as binary options. The biggest difference is that with binaries the odds are not 50/50 as the payout is always slightly lower than the risk of loss (usually 100%).
    However, if a regular stock option expires out of the money it also becomes worthless and warrants a 100% loss.

    One thing however is that the alure of binaries is that you need to make a much smaller investment that regular trading in order to reach a higher payout.
    This is mostly false.

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    woja is offline Public Member
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    Lol.
    What's false? It's really easy to just say something is incorrect without backing up your claims.
    Have you ever even traded stocks or stock options?

    I did not talk about the inherent differences between stock trading and binary trading where with binaries you're trading against the broker and not actually buying any rights to the company or asset in question. I was only referring to the risk factor difference between the two trading tools, so I would really be interested in hearing WHAT was false in my statements rather than a generic that's a lie statement.

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    I totally agree with woja that binary options is a spot 50/50 investment to set your stake on if the trade goes up or down....................if you have some insight to the currency market, then this can be very profitable to the player and every stake has its risks!!!

    I have been involved in the Social Investment Market as we call it today, which I really got hooked into coming from a poker players background. You have to build a knowledgeable base about the markets and combined with my interest in world affairs & politics comes in very handy sometimes.

    If any one is thinking of going over to the Social Investment World and want to learn more, then I am here to answer all your questions 24/7 if needed......................lol

    Have a great week and now a good time to look into a new niche before it becomes over-crowded as in the Poker, Casino, Bingo etc
    KEITH WILLIAMSON | INDEPENDANT GAMING CONSULTANT

    SKYPE= ironman20001


    http://twitter.com/ironman20001

  9. #8
    woja is offline Public Member
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    Thanks for agreeing Ironman but I think you misunderstood me.
    I did not say that your chances are 50/50 with binary options.
    They're usually more like 60/40 towards the broker since you make an 80% profit on a win (for example), while you stand to lose 100% if you lose.
    That'd mean your chances are more like 80/100, or 44%

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  11. #9
    -Shay- is offline Public Member
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    Quote Originally Posted by woja View Post
    Stock trading and regular options trading are just as risky as binary options. The biggest difference is that with binaries the odds are not 50/50 as the payout is always slightly lower than the risk of loss (usually 100%).
    However, if a regular stock option expires out of the money it also becomes worthless and warrants a 100% loss.

    One thing however is that the alure of binaries is that you need to make a much smaller investment that regular trading in order to reach a higher payout.
    For starters, this post attempts to paint a picture of binary options as an "investment" as opposed to a "bet".

    Second, what are the potential upside rewards and downside risks for "regular options", "stock trading", and binary options respectively?

    I get it that binary options and financial betting are here to stay but such things are not "the same" as buying/selling/shorting stocks or calls/puts. We can pretend all day long that they're the same - but at the end of the day, they're quite different and to think otherwise, we are fooling ourselves and doing so at the potential expense of others.

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    woja is offline Public Member
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    I take it you did not read my follow-up posts.
    I did not say that both mediums are the same. They are very different. The biggest difference being that with binaries you are not actually buying and asset or the rights to any asset, rather trying to predict the movement.

    This means that the brokers do not need to have any real ties to the stock exchange and therefore don't need to comply to strict NASDAQ etc. regulations. This opens a huge loophole and makes it really easy for anyone to open a binary options brokerage anywhere in the world. All you need is a market quote feed and some software which you can license from a number of places (Spotoption, Tradeologic, Tech Financials etc.) and you're good to go.

    This has lead to many scam brokers to arise as they are very difficult to regulate unless they opt-in for regulation on their own accord.

    Stock market brokers need to be able to submit buy and sell orders to the different market makers. If they don't abide to regulations they are simply cut-off and sanctioned.

    Again, my original post was referring to the risk of trading stocks, options and binaries. They can all be VERY risky, especially if you take pennystocks into account.

  13. #11
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    I take it you did not read my follow-up posts.
    I did not say that both mediums are the same. They are very different. The biggest difference being that with binaries you are not actually buying and asset or the rights to any asset, rather trying to predict the movement.
    This is the point Shay was making....

    It IS NOT INVESTING, but gambling or betting on that movement.

    Sadly, many both allow and encourage unsuspecting visitors to believe that it is investing....and in fact the word trade shouldn't even be used when in fact it isn't trading at all.

    Rick
    Universal4

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    I think the author summed it up best in the Forbes article: "If people want to gamble, thatís their choice. But letís not confuse that with investing. Binary options are a crapshoot, pure and simple."

    Binary options are more suited for online gamblers who are interested in financial markets, not for those serious in influencing the market and investing with a certified broker.

    We have a section on our website for players who are interested in binary options, but it's not a large market, by far.

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    It has long being said that binary options is gambling. That is not the case because, to trade with binary options, though simple because you just pick an up or down option, it implies more than luck. You have to be on the look out for the market behavior. But for me since I have started trading with global trading 365 have updates of the market and a personal manager to guide in my tradings. so for the mpment have no complaints about it.

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    If binary are imitating the markets behavior 100% then all is good, the problem starts when its not "accurate".

    Moreover, when you buy a real stock or currency you influence the market by your action, so in the binary options case its not exactly
    like this but hey.. that's part of the game, just be aware !

    So its not really trading but its not really gambling.. I guess the truth is somewhere in between

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    You are not trading the options in any way.

    You do not own it, you are trading your money for the right to gamble on the up or down movement. If you win the gamble, you own some of the money back, but not the option.

    You may have a personal manager, but they guide you in guessing, or gambling on the up and down movemenet.

    Saying it's trading gives the impression that you actually own something.

    Rick
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    Quote Originally Posted by universal4 View Post
    ....Saying it's trading gives the impression that you actually own something....
    I like the way you phrased this sentence. Right to the point

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    As someone who used to daytrade stocks and stock options on Nasdaq and NYSE I can tell you that stock options are not much less of a gamble that binary options, provided the broker is genuine and doesn't manipulate the feed (which more do than don't actually).

    I'll give you an example:
    Let's say I buy a $40 call stock option with a certain expiry date. If the option expires at $41 that's great. I own the right to buy said stock at $40 and make a $1 profit on the difference. If I bought one option, that's a $100 gain on a $200 investment (price of buying the option would of course differ per the trading price of the stock at the time of buying the option and the distance from the expiry date).
    If however the stock was $40 or under at the time of expiry, the stock option is worthless since you can buy the price cheaper than your option gives you.
    So, stock options and stocks for that matter are also a gamble and are highly manipulated no matter what you say.

    With binaries you don't physically buy or sell any options, but there is a slight resemblance in the general idea.
    I would say the biggest difference between stock options and binary options is that with binaries you're trading (or betting) against your broker, so they have a vested interested in helping you lose, while with stock market brokers make money off commission, so they're interested in you actually making money, as that way you'll continue trading and therefore continue making them money.

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    Quote Originally Posted by woja View Post
    As someone who used to daytrade stocks and stock options on Nasdaq and NYSE I can tell you that stock options are not much less of a gamble that binary options, provided the broker is genuine and doesn't manipulate the feed (which more do than don't actually).


    You're leaving out the fact that when you buy / sell an actual option on a stock, you have the ability to exercise the option (call away underlying stock at the specified strike price or put stock to someone at a specifically stated price).

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    Quote Originally Posted by -Shay- View Post


    You're leaving out the fact that when you buy / sell an actual option on a stock, you have the ability to exercise the option (call away underlying stock at the specified strike price or put stock to someone at a specifically stated price).
    Completely correct !

    I agree though that for the inexperienced average person the stock exchange arena might look the same as entering a casino ...but you can say this on anything you do without knowledge so its irrelevant for this debate

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    Binary Options are NOT really entering the Stock Exchange arena, they are just betting on the prices of those stocks without actually entering the arena.

    Rick
    Universal4

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