Wednesday, September 4th, 2013 by Michael Freeman
Free money offers are very common when you initiate a new account with a binary options broker. In some cases brokers are willing to match your deposit amount with up to %100 cash bonus when you fund your account. As soon as you accept a bonus offer, a restriction is placed on your account preventing your ability to request a withdrawal until you reach a ‘volume of trades’ requirement. This volume of trades is usually between 10-45 multiplied by the deposit amount. If you deposit $500 and the volume requirement is x 30, the volume requirement is $15,000. Winning trades and losing trades count against the volume of trades. Once you meet the the bonus restriction you will qualify for a cash withdrawal.
Is a Binary Options Bonus a Scam?
To understand if the bonus is a scam or a legitimate offer we must first consider the consequences of a bonus without restrictions. Many traders would use the opportunity to receive free money and request a withdrawal the following day. It doesn’t take a genius to figure this one out. The bonus is not a scam if a representative explains the restriction that comes along with it and seeks your approval. If you have a strong preference for a broker and you know you plan to trade for the long-run, extra money won’t hurt and you can only gain from taking a bonus offer. The point is that you should always signup with an honest broker with transparent offers.
Bonus Offer without Restrictions on Withdrawals
Recently I received an email from a trader who was convinced that he was given a bonus without a restriction on withdrawals. The representative as stated verbally that the bonus will not restrict future withdrawals. For me it already sounded a little bit suspicious so I asked the trader if he could request a written confirmation that the bonus doesn’t restrict withdrawals. In response, the representative sent back a long ‘Terms and Conditions’ with all the A to Z of the company which also clearly states that the bonus offers always have a withdrawal requirement.
You can’t trust a verbal promise over the phone and if you receive an offer that seems ‘too good to be true’ you must always request the offer in writing. If the company is unable to provide you with a written promise you should avoid going forward with the offer. The bonus offer is a loyalty offer and as long as the company is honest about it and you feel comfortable signing up with the offer, there is absolutely no problems with it. Avoid shady companies and know what you are signing up for, this is today’s conclusion!
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