It is in human nature to want to do something for the least amount of effort. Whether it is work related or learning something new, most people tend to look for shortcuts in achieving what they want. The same goes for most traders who are new to binary options trading. Rather than making an effort to learn about charts and picking up the necessary skills to analyze the markets, most beginner traders turn to binary options signals to tell them when to trade. However, turning to a binary options signal provider is not as straight forward as most people would like to think as there are many signal providers who are out to scam unsuspecting victims. To help you avoid becoming a victim of one of these scam signal providers, look out for some of the red flags that we have highlighted below.
One of the most common ways that scam providers use to lure victims into their fold is by showcasing win ratios that are unbelievable impressive. Any signal provider who shows you a win ratio of above 85% should be view with caution. In the first place if it is indeed true that they can win more than 85% of the time, they won’t be trying to sell you a signal service as they will be too busy trading and making all the money themselves. Furthermore, you should also note that the statistical numbers provided by the provider might not be telling the whole picture as it can be easily manipulated to put the provider in a positive light.
Like all successful business, a reliable signal provider will have a track record as their business model would have allowed them to remain in business for the long term. Fly by operators on the other hand, will lack a decent track record as they have to be on the move continuously to prevent people from getting wise to their antics. Nevertheless, even if a provider could show a short history of successful trades, you should not get carried away as this could be purely be a result of randomness rather than the ability of the signal provider to pick winning trades.
Sometimes after providing the signal providers with your contact info, they will get their marketing guys to contact you to get you to sign up with them. These marketing guys can at times be overzealous and may even demand your credit info before you even decided if you want to subscribe to their service or not. If you received this kind of treatment from any signal provider, the best course of action is to totally avoid having anything to do with them even if it means changing your email address and telephone numbers.
Another tell-tale sign of a scam binary options signal provider is the lack of a free trail for a potential subscriber. This shows that the signal provider is not willing to let the quality of their signals influence your decision to subscribe to their service as they are not confident of the quality of their service or they simply have something to hide. Your best course of action here is to avoid them like a plague.
While trading bots or software might be great if you are a trader who wants to automate the trading process, it is not the same case when it comes to a signal service provider. This is because the financial markets are dynamic and at times requires the intervention of an analyst to make a judgement call for a specific scenarios. Signal providers who use trading robots or automated programs cannot adapt to the dynamic nature as these programs cannot take into account the “lemming effect” which some situations can have on traders in the market.
In contrast to exceedingly impressive win ratio, we have at the other end of the spectrum signals providers which deliver very poor results overall. These signals providers in trying to cover their tracks will often sent out a large number of signals everyday hoping that nobody will notice the poor quality of the signals provided. So more is not necessarily always better. At the end of the day, it’s the quality of the signal that counts.
The whole purpose of subscribing to a signal provider is so you can trade on the signal provided. So if a signal provider is consistently sending out their signals late, then there is no point in subscribing to such a signal provider. Furthermore, the signals though accurate could entirely be the result of the provider rehashing a scenario which has just gone past as one of their winning signals.
If we were to take a look at the signal provider industry, we find that most signal providers have no staying power. So rather than investing in a service which might close down tomorrow, it make more sense for you to invest in yourself and educating yourself properly with the intricacies of the financial markets.