There is now an unofficial war between forex and binary options, as the 2 are currently widely used by the leading global traders. Up until 2008, forex to some extent had a monopoly with regards to online trading and online brokers. However, in the past 5 years there has been a notable development in digital options and brokers. It was unpredictable that there would be a rivalry with the 2 types of online trading categories. This rivalry has grown due to the willingness of brokers to try and attract big investors.
Forex and Binary Options Trading
Forex is a well-known industry, and is actually the biggest market in the world with some estimates putting the daily turnover at $4 trillion. Since the mid-1990s there has been a revolution in online forex brokers that has continued to the current day. What forex brokers offer traders is a great amount of leverage. This is a feature of forex trading that lets you trade your favorite currency pair by controlling more money than you put into a trade. For example, a leverage of 400:1 allows you to put $1000 into a trade and trade with $400,000. This may sound nice at first, but the leverage factor can work against you too.
Binary Options
Binary options started to become big from the late 2000s and have become a dominant way to trade the financial markets. There is no leverage factor at all with digital options, meaning you do not have to worry as much while trading. In addition, there are also various features that a forex broker does not offer to its traders. This includes the chance to choose the time when you want your trade to expire. Expiry times range from a few minutes to a few months. What’s more, the price you buy and sell the digital option is the same.
The Rivalry
There will always be a rivalry between binary options and forex, because this is how online financial trading goes. You may be now asking yourself where do you fit in to all of this. If you do not trade in either of these industries, you will have to choose either a forex broker or a digital options broker. If you are someone that understands that trading has changed a lot as of late, then you will want to take a deeper look into the benefits of what digital options can bring you.
