Binary Options Con/Scam

This is a discussion on Binary Options Con/Scam within the Fixed Odds forums, part of the Commercial category; This is not about broker bashing but to highlight what kind of stupid risks come in to picture when such ...

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Old Oct 31, 2012, 2:11am   #16
Joined Aug 2012
Re: Binary Options Con/Scam

This is not about broker bashing but to highlight what kind of stupid risks come in to picture when such a product/ broker choses to run away from more established regulators..
"Regulations crap" is what you vetsed interest going to say all the time.. but none of you have addressed the addditional risk questions raised
SO Mr Stone and Mr Fielder why don;t you honestly answer some of the questions raised

Why shoudl anybody trust a small broker ina jursdictions where it is realtively easy to get a so called Broker Licence over a broker regulated in a large and established jurisdction.
Tray and do this in AUS without a proper licence and you will end up in Jail
and that is a win for consumer
I mean Binary looks attractive ye ssure get in to main market and 3earn respect first
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Old Oct 31, 2012, 2:17am   #17
Joined Aug 2012
Re: Binary Options Con/Scam

So Mr Stone
-What happens to client money if your "reputed" firm goes down???
_ are you a market maker? ...for people to win do you have to loose?
- If you say "we hedge the exposure" is that disclosed? at all? and how
- Take FTSE option on your firm are they based upon Official FTSE value or soem value "Dervied" by you? which we can't dispute?
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Old Oct 31, 2012, 5:56am   #18
 
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Re: Binary Options Con/Scam

Quote:
Originally Posted by moka2 View Post
This is not about broker bashing but to highlight what kind of stupid risks come in to picture when such a product/ broker choses to run away from more established regulators..
"Regulations crap" is what you vetsed interest going to say all the time.. but none of you have addressed the addditional risk questions raised
SO Mr Stone and Mr Fielder why don;t you honestly answer some of the questions raised

Why shoudl anybody trust a small broker ina jursdictions where it is realtively easy to get a so called Broker Licence over a broker regulated in a large and established jurisdction.
Tray and do this in AUS without a proper licence and you will end up in Jail
and that is a win for consumer
I mean Binary looks attractive ye ssure get in to main market and 3earn respect first
With little disrespect to your thoughts regarding regulation but the main issue is not the regulation but the product itself.

Even lottery tickets are based on mathematically acceptable market approaches. 1000 people give in $10 each generate $10,000. The winners get $8,000 payout and the rest goes to the fat hairy tax man.

In the case of binary options you expect 1000 people to pay $10 each and promise every one $8000 payout and the give each of them the technical ability to win it also. The brokers cannot pay $8000,000 while raising only $10,000 assuming every participant gets the market direction correct.


The mathematics of binary options with 150% or 200% payouts does not work hence there would never be a sound regulatory body approving such a product.

The correct license for this product should come under the "gaming" or specifically "gambling" where every one is aware that the house has the upper edge.

Its a gaming product and should be treated as such.

With correct regulation, customers can at least be assured to be paid in case they win "acceptable" amounts.

Last edited by safvan; Oct 31, 2012 at 6:02am.
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Old Oct 31, 2012, 6:07am   #19
Joined Sep 2012
Re: Binary Options Con/Scam

Dude - I've said it about 5 other posts specifically addressed to you:
You obviously won't trust an unregulated broker for reasons you've expressed and I dont and didn't disagree. I think your argument is very good. It's useless though. That's my point. You are arguing only for those who are going in wanting regulation, only regulation, and damn the unregulated. Ok. But what about people WHO DON'T want to trade with the IGs of the world? That was what I have been answering. The risk is not an issue for those who can't or won't trade with the regulated and I can give you reasons why they wouldn't want to. It's not the issue. There are people who like product X and those who like product Y. I just happen to be more open to defending the unregulated as I can't stand the zealotry surrounding regulation. Sending some ahole to jail DOES NOT HELP CONSUMERS !!!! So either tell me how regulation dropped costs, lowered spreads, increased liquidity, lowered the demands of the consumer when opening an account, ANYTHING - and i'd agree.

Those who want regulation won't listen to me or Mr stone or anyone else. So it's pointless
Those who don't necessarily want regulation - probably understood my argument

Have a good day
Mr. Fielder has left the building
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Old Oct 31, 2012, 6:19am   #20
Joined Sep 2012
Re: Binary Options Con/Scam

Quote:
Originally Posted by safvan View Post
With little disrespect to your thoughts regarding regulation but the main issue is not the regulation but the product itself.

Even lottery tickets are based on mathematically acceptable market approaches. 1000 people give in $10 each generate $10,000. The winners get $8,000 payout and the rest goes to the fat hairy tax man.

In the case of binary options you expect 1000 people to pay $10 each and promise every one $8000 payout and the give each of them the technical ability to win it also. The brokers cannot pay $8000,000 while raising only $10,000 assuming every participant gets the market direction correct.


The mathematics of binary options with 150% or 200% payouts does not work hence there would never be a sound regulatory body approving such a product.

The correct license for this product should come under the "gaming" or specifically "gambling" where every one is aware that the house has the upper edge.

Its a gaming product and should be treated as such.

With correct regulation, customers can at least be assured to be paid in case they win "acceptable" amounts.
Ok, back in the building
Your math is wrong
And your assumption is wrong
MIFID has already agreed to step in to regulate binaires post CYSEC regulation (sometime in early 2013 with much of the regulation kicking in before official launch already on the 1st of Jan 2013). Meaning, your argument is moot - one touch options (those 200% and even 800% winning payouts ARE in fact going to be regulated).

Your math sucks cause you can construct 1 touch options using vanillas - which if you knew anything about the math behind the vanillas would lead you to the simple conclusion that as opposed to directional correctness, the statistical probability of guessing the right touch strike is very low and much lower than 10%, thus leverage based on the cost of said option (using simple vanilla call puts) would lead to a cost of option that is very low. So..... the cost vs reward in such a strategy would be a scenario that could theoretically far exceed 800% or even 5000% ! Trade some vanillas, learn the math, then come back with a round about argument that makes actual sense man.
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Old Oct 31, 2012, 6:34am   #21
Joined Aug 2012
Re: Binary Options Con/Scam

Safwan:
Yes Product risk is important so is broker risk
David,
Dude and my point is the unregualted products and ease of promoting those gives rise to crooks
Once again show me these unregulated products are less or equally risky to exchang traded and I would agree
-I can't see teh liquidity
- I am dealing with Market maker
- I ca't question the settlement
So what you say to that why won;t you anser the specifics
Ad your suggestions that small accounts should not worry too much for Broker safety etc is just irresponsible
Donlt think I am suporting IG either they are bigger but the risk for a consumer are similar
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Old Oct 31, 2012, 6:36am   #22
Joined Aug 2012
Re: Binary Options Con/Scam

Regulated by CYSEC .. LOL as comapred to FINRA, SEC, ASIC, FSA etc.. why even bother? why even CYSEC
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Old Oct 31, 2012, 6:45am   #23
Joined Sep 2012
Re: Binary Options Con/Scam

Can you see the liquidity when trading forex with a regulated broker?????
Even if you could how would this help you in any way as a retail trader? And please for the love of all things holy do not try to tell me that a retail trader can read into depth of market. Cause if he could, he isn't a retail trader. And in that case, he can still use a platform relying on ECN and still trade with an UNREGULATED broker. So this has nothing to do with regulation. It has to do with PRODUCT.

Some people eat hamburgers at fast food places. I don't. I think the people that eat there are crazy and are taking huge RISKS with their life! But I don't create or walk into forums preaching this. To each his own. And yes - they are the same.

Irresponsbile again is not the issue - the regulated brokers of the world are not a good solution for everyone. And there are reasons for this. Just like if you were to raise the tax on a fatty hamburger that is 2000% more likely to cause a coronary, wouldn't stop people from eating the filth. It doesn't make it irresponsible of me to promote the burgers. It just means that people need to be smart and understand what risks exist. And if you really want to know - I think that 75% of people know what they are getting into. Know that the company may fall and not return their cash. Yet they do it anyway - and nothing a regualtor does will ever stop it. And my final point is that this is GOOD. As those unregulated brokers are usually much better at servicing the customer. So assuming the vast majority of people lose money - and they do, at least they get better support and training at the unregulated brokers
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Old Oct 31, 2012, 7:44am   #24
 
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Re: Binary Options Con/Scam

Quote:
Originally Posted by davidfielder View Post
Ok, back in the building
Your math is wrong
And your assumption is wrong
MIFID has already agreed to step in to regulate binaires post CYSEC regulation (sometime in early 2013 with much of the regulation kicking in before official launch already on the 1st of Jan 2013). Meaning, your argument is moot - one touch options (those 200% and even 800% winning payouts ARE in fact going to be regulated).

Your math sucks cause you can construct 1 touch options using vanillas - which if you knew anything about the math behind the vanillas would lead you to the simple conclusion that as opposed to directional correctness, the statistical probability of guessing the right touch strike is very low and much lower than 10%, thus leverage based on the cost of said option (using simple vanilla call puts) would lead to a cost of option that is very low. So..... the cost vs reward in such a strategy would be a scenario that could theoretically far exceed 800% or even 5000% ! Trade some vanillas, learn the math, then come back with a round about argument that makes actual sense man.
Absolute nonsense. No single party on the other side of the trade (should it really exist) is continuously going to risk such volatility.

There is NO central exchange for the majority of these unregulated brokers. They make the market period.

The only exception to this rule as you have uttered in your ramblings is the play of probability.

Bank gathers the fortunes from the pubic and runs its business till there is a bank run.

Binary options with 800% payouts will never be regulated by an authority with "regulated neurons" capable of thinking rationally unless they agree to the probability argument but that is still not discounting the fact that no central liquidity provision system exists for the majority of option gaming products.

So Mr Einstein of "How I became a Billionaire in 30 days" book, the mathematical weightage you are giving to the potential wins over losses in this scenario lies within the confines of the gambling products and not from money management risks overseen by regulated exchanges.

I am fine with these products advertised as gambling games with some edge given the customers. It needs to if customer retention is of some importance.

Oversell your childish Bull Sh**t to some one else.

Last edited by safvan; Oct 31, 2012 at 7:58am.
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Old Oct 31, 2012, 7:46am   #25
Joined Aug 2012
Re: Binary Options Con/Scam

Forex itself is still OTC .. I am comapring your Binary etc to Exchange traded products like
Equity, Equity Options
Futures Option ( Not even Futures becasue Futures brokers clienst are not protected by SIPC etc)
DOM front on above mentioned products is very clearly shown ( now a days in ASIC regualted brokers even FX is forced to show DOm and liquidity )
On other counts how exactly is OTC Binary better? Apples to apples
- I am dealing with Market maker ( except some big one who act like tru exchange but there is a always a risk that MM might not be able to match 2 sides and exposed and trade against you)
- NO client money safety insuracne
- I can't question the settlement
- Sometimes products are defined in sucha way that the you can't check it independently
- Low entry costs ( to become a "Broker" meaning fly by night operators cna get in)
- And finala point regulator can try and stop this happening by
Enforcing soem of teh transperancy thinsg mentioned above
But you would say they are not imprtant.. and should be ignored
I would support Binary if there are proper checks and balances along above lines not soem tinpot jursdiction allowing anybody to open sucha business
Until then it is aaaditional risk that just can't be ignored and people shoudl think 100times
Market risk is fine we all take it. but why add the other risk?
"I think that 75% of people know what they are getting intoKnow that the company may fall and not return their cash. Yet they do it anyway " and you promote such a thing WOW
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Old Oct 31, 2012, 7:55am   #26
 
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Re: Binary Options Con/Scam

Quote:
Originally Posted by moka2 View Post
Forex itself is still OTC .. I am comapring your Binary etc to Exchange traded products like
Equity, Equity Options
Futures Option ( Not even Futures becasue Futures brokers clienst are not protected by SIPC etc)
DOM front on above mentioned products is very clearly shown ( now a days in ASIC regualted brokers even FX is forced to show DOm and liquidity )
On other counts how exactly is OTC Binary better? Apples to apples
- I am dealing with Market maker ( except some big one who act like tru exchange but there is a always a risk that MM might not be able to match 2 sides and exposed and trade against you)
- NO client money safety insuracne
- I can't question the settlement
- Sometimes products are defined in sucha way that the you can't check it independently
- Low entry costs ( to become a "Broker" meaning fly by night operators cna get in)
- And finala point regulator can try and stop this happening by
Enforcing soem of teh transperancy thinsg mentioned above
But you would say they are not imprtant.. and should be ignored
I would support Binary if there are proper checks and balances along above lines not soem tinpot jursdiction allowing anybody to open sucha business
Until then it is aaaditional risk that just can't be ignored and people shoudl think 100times
Market risk is fine we all take it. but why add the other risk?
"I think that 75% of people know what they are getting intoKnow that the company may fall and not return their cash. Yet they do it anyway " and you promote such a thing WOW
That is my only view of strength on this topic.

The customers should be aware that these gaming products give the edge to the house. Any reasonable winnings should be account for "Entertainment" value only.
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Old Oct 31, 2012, 8:06am   #27
Joined Aug 2012
Re: Binary Options Con/Scam

Unfortunately "Customer" get sucked in by "oh how easy it is to make 70/ 80% return in 1 hour" thing ( not even mentioning all other risks and shortcomings I have been mentioning)
Just the way people got sucked in to the leverage of CFD and FX .... now a days just buyer beware warnings are not good enough Regulators need to come down with ton of bricks on crooks but before that they need to put in place things which will improve the market transparency. and safety. it is convenient for shonky operators and supporters to say " oh look regulators don't do enough hence we should not have them..
Just like saying Since Police don't solve all crimes we should not have them.. getting mugged and raped is a " Product risk" of being alive... LOL
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Old Oct 31, 2012, 8:11am   #28
 
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Re: Binary Options Con/Scam

I am going to retire from this thread because getting into philosophical arguments with "its a scam" and "its not a scam" crowd will only lead to more ratings for T2W and would not practically change much on the ground.

However before doing this, let me paste in the final word...

No matter what product financial geniuses are thrusting down customers down back pockets, they should be clean as the mineral water about their ups and downs.

Millions of people go to Casinos every day knowing the fact that they are going to lose all their money. They do because that is the way human beings dance with the fortune stars.

What Casinos do is to clearly paint out the picture as to what the mice people are getting into.

Binary Options, Forex and other unregulated ruthless species of the financial world must do the same.

It will end up helping their business. The saying that truth drives away customers is the biggest scam on the earth.

We just want Casinos to tell us "We are going to rape your Savings" and that is it. Nothing more.

Advertise these as gaming products and clear out the fog and the business would boom as it is suppose to in a world packed with "I want it all and I want it now" humans.

Last edited by safvan; Oct 31, 2012 at 8:19am.
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Old Oct 31, 2012, 8:13am   #29
Joined Aug 2012
Re: Binary Options Con/Scam

What Casinos do is to clearly paint out the picture as to what the mice people are getting into.

Binary Options, Forex and other unregulated ruthless species of the financial world must do the same.

Agree with you
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Old Oct 31, 2012, 8:20am   #30
D70
Joined Nov 2009
Re: Binary Options Con/Scam

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Originally Posted by Filmon View Post
BOCapital, OptionBit, GOptions.........

I opened account with BOCapital with $200 deposit, refused their bonus as I did not agreed with their withdrawal restriction tide with bonuses. Started trading and I was up a grand on two days of trading on my third day of trading I was up by additional $600. That is when my problem with them started, first they started adding additional pips to the strickprice and then they started tampering with the expiration times like a YOYO. At first I did not expected such-things when I start loosing on trades that I should not have losed, but I quickly realised the odd things they where doing.

I called my so called account manager regarding the problems, funny enough she was more concerned about me depositing additional money so that they can "triple my bonuses". I told her why should I put in more money to my account when I'm winning and have over $1500 in my account. Anyway to cut the story short, I realized the hard truth that I was dealing with con artists when I spoke the so called head manager, he start to belittle my knowledge of trading and the fact that my initial deposit was "little 200", he was an absolute ****.

Anyway I requested a withdrawal of 50% of my profits just to test the waters and did not got nothing after trying everything I could to get my money for the last 6 weeks. They simply closed my account and refused to replay to any of my emails.

I also realised that they are the sample con artists at Optionbit. I can get my money back and I can not undo my silly mistakes of providing them all my IDs. But I'm determine to jeopardize their scam business in every-way I can. I will create a website, make a youtube videos, do reviews and stuff. All in effort to inform people and getting the binary option scam out of business.

Seen guy named 'Mr. Stone' advertising GOptions yet another scam broker. quick glans on the website is enough. They say "Our offices are located here in the heart of London" I guaranty you they do not have any office or license in London. If they do, I have no problem giving them a visit to check on things. The office they claim to have in London, on their website is a bogus, an office that does not exist. Mr Stone prove me wrong will ya. Please invite me to your office
Did you get a screen shot of your trading and proof of your money in the account?
File a small claim against them. You can do it online. Dont let them get away with it. It's easy to do.

I have used the small claim route 3 times so far, for various things. I got my money every time.

Twice against an employer. Once against a landlord.

Last edited by D70; Oct 31, 2012 at 8:25am.
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