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  1. #1
    Junior Member Sbgtrading's Avatar

    Seriously....where does the money come from? !!!

    I have a general question about the binary options industry...where is the money coming from?

    When I win $100 on a 60-second option...where did that $100 come from?
    I don't think it's feasible that there's some other trader on the other side of my trade (like it is in a regulated market with brokers merely connecting buyers to sellers). I'm assuming that we are trading against the broker...am I right?

    So the broker is not on your side...he is against you. He profits only when you lose. Is that how this business works?

    If so, then that scares me to death. If I become an excellent trader, and consistently make $10,000 a day (for example) wouldn't that broker start tweaking my fills, tweaking the data, and perhaps just refuse to pay me my earnings?

    What keeps these guys in business? Are they just hoping to land a bunch of terrible traders who burn through an account or two?

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  3. #2
    Veteran Member randy1953's Avatar
    Quote Originally Posted by Sbgtrading View Post
    I have a general question about the binary options industry...where is the money coming from?

    When I win $100 on a 60-second option...where did that $100 come from?
    I don't think it's feasible that there's some other trader on the other side of my trade (like it is in a regulated market with brokers merely connecting buyers to sellers). I'm assuming that we are trading against the broker...am I right?

    So the broker is not on your side...he is against you. He profits only when you lose. Is that how this business works?

    If so, then that scares me to death. If I become an excellent trader, and consistently make $10,000 a day (for example) wouldn't that broker start tweaking my fills, tweaking the data, and perhaps just refuse to pay me my earnings?

    What keeps these guys in business? Are they just hoping to land a bunch of terrible traders who burn through an account or two?
    This is how I see it in real life in any kind of trading you probably have less than 10% that win on a consistent basis it could be as low as 5% or less. These are the traders that always stay in profit. well guess what the 90% that don't and lose much more than they win where do you think there money goes?

    Anyways retail FX brokers are the same way you are trading against them also it's not just BO brokers.
    Now ECN forex broker is different there counter party are the banks but most Forex brokers are market makers the same as BO brokers. But again because most traders lose the brokers have more than enough money than to play around with the few that are winning. However I do understand what you are saying it's a question of mine also if you begin to bet big and win all the time well if you are taking a good size piece of the pie and it's all the brokers money I also wonder. This is why many po traders say keep your trading under the radar the best you can.
    If you become very good then you might want to go the ECN route but there you are really trading with the big boys and I don't think even the best traders have a chance of raking in 10k a day with no problems.
    Here's probably what will happen the big boys will find out exactly what your strategy is and find a way to tweak something so it does not work anymore. this is common in the Forex world. some guy codes a EA and it works like a charm but the shelf life is small so down the road it just doesn't work anymore. There is really no way around this even with a ECN the big boys banks will find a way to stop your trading from working simply by adjusting something that messes you up and simply because they are big enough and control everything they can.

    good question btw
    Last edited by randy1953; 01-05-2016 at 05:35 AM.

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  5. #3
    Administrator Martin Kay's Avatar
    "If so, then that scares me to death. If I become an excellent trader, and consistently make $10,000 a day (for example) wouldn't that broker start tweaking my fills, tweaking the data, and perhaps just refuse to pay me my earnings?"
    people tend to over-praise themselves. First, let's see if you can make $10,000 per day. I know of only 1 maybe 2 people that actually makes such high profits on a monthly basis.

    "What keeps these guys in business? Are they just hoping to land a bunch of terrible traders who burn through an account or two?"
    It's a mix of bad trader and bad brokers.
    “Don't believe anything you read on the net. Except this. Well, including this, I suppose.” ― Douglas Adams

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  7. #4
    Legendry Member Okane's Avatar
    Well, first of all let me tell you that you are most likely not going to make 10K a day and that's coming from
    me, someone who can make 100% profit within a month, and it has to be on a very good month.
    To make 10K a day with decent money management you need a huuuuuge deposit and trade like crazy! Unless you want to gamble
    like some people and use Martingale but then you wont last long in this business.

    About the money:

    The money comes from losers, just like in a casino... One guy loses, the other one makes money and since 90-95%
    of "traders" are gamblers or become the victims to their own greed, the lucky 5% of us real traders can sleep
    well at nights, knowing we will get our withdrawals on time! Which means the broker doesn't have any issues with making money.
    But I must warn you, not all brokers payout, many are outright crooks so pick really carefully. Go with the big ones with good reputations!

    Now, tell me, is that really that much different from your own bank?
    Not really, Mr Anderson gets fooled to sign up for a credit card with a 10% interest rate (written in the terms and conditions that he didn't see in the fine print),
    that money is then loaned to you with another 3-5% interest rate so you can buy that house you always wanted while Mr Anderson will probably sooner or later lose his house.
    That's how it always works, whenever someone wins, others lose. It's life.

    *So, I guess it all comes down to this: Which one do you want to be? The 95% or the 5%. Mr Andersen or the home owner?
    And with the 10K a day dreams you will probably end up in the Mr Anderson league pretty soon :P
    Last edited by Okane; 01-05-2016 at 12:04 PM.
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  9. #5
    Legendry Member Okane's Avatar
    On the bright side, you are smart enough to not let your account manager do trades for you!
    That's one step towards the right direction.
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  11. #6
    Moderator Kolyo's Avatar
    That’s right there are always winners and losers and most often than not losers are the most aggressive, impatience and inexperienced traders. There are brokers with very deep pockets and for them someone to make 10k a month won’t be a problem, but of course if you win, you take the money from the broker. 10k a day that’s just a dream! Don’t fall in such traps to believe you can make it without extremely big capital and great skills, it’s not serious
    "The goal of a successful trader is to make the best trades. Money is secondary." - Alexander Elder

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  13. #7
    Veteran Member randy1953's Avatar
    Just speaking for myself I will be very happy to make $400 to $500 per day. It can be done if you are a very good trader starting out with just a $5000 account using 5% as your max bet. But you will need to win most of your trades winning 3 to 4 trades per day and losing only once in a while.

    But here's the thing the market will not always be suited to trade so you will have days where it's not good to trade. then you need to follow some good money management which means even if you are trading on a good day and you have won those 3 or 4 trades well good M/M tells you to stop but your mind may be saying I didn't trade yesterday because of poor market conditions and now you are thinking because it's such a good day and you are winning to continue trading to make up for the down days and then it gets you you begin to lose.

    Having said all this if you can double your account every 90 days which I feel is possible(33% per month) and you begin with a 5 k account at the end of a year you will have $80,000 or roughly up to $2k per trading day (4 days per week)

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  15. #8
    Legendry Member milos's Avatar
    It is very hard to make $10000.I only can say in the best trading days for two weeks make 40% on investment amount.It was deposited account $500 and after two weeks it was $700.Also I started to trade with $1500 and after almost two months trading the sum was reached $3300.

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  17. #9
    Veteran Member randy1953's Avatar
    Quote Originally Posted by milos View Post
    It is very hard to make $10000.I only can say in the best trading days for two weeks make 40% on investment amount.It was deposited account $500 and after two weeks it was $700.Also I started to trade with $1500 and after almost two months trading the sum was reached $3300.
    Nothing wrong with that you increased your profits by over 600% in 2 months! If you continue the same course in 2 more months you should have $18,000! compounding is a wonderful thing!

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  19. #10
    Rookie Member red186's Avatar
    Talking about realistic profits got me thinking about this guy,dropped out of uni spent all his student loan on trades... He's been in the papers and on tv here in the uk recently. Apparently £30k is a bad month and £200k is a good month... Am i missing something here how is this possible, he's rinsing the broker!!

    (oh, i can't post links due to no post count, but if you google - elijah oyefeso daily mirror)

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