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Binary options - casino or not: what's the difference?

Binary options - casino or not: what's the difference?

Nowadays, binary options are often compared to casinos and gambling. This is usually done by people who do not know anything about trading and are trying to understand how binary options brokers work. Indeed, from the outside it may seem that Binary Options, like casinos, work according to the scheme “Guessed it - earned it! I didn’t guess - I lost it! But should Binary Options be attributed to gambling and casinos?

Binary Options and Casino

Binary options, as a new financial instrument, attracts a lot of attention from people who have never thought about online earnings before. Previously, in order to earn a lot, it was necessary to go to work every day, rise through the ranks, and develop skills. Now, a laptop with Internet access is enough to earn money. It is not surprising that Binary Options is now actively discussed and advertised.

Binary options and casinos

At the same time, many people are very skeptical about binary options. This behavior is due to the fact that people have learned the hard way when playing in various online casinos. And the brokers themselves do not use the best advertising methods, focusing the attention of new customers on quick earnings. And where there is quick money, there are pitfalls.

The advantages of Binary Options are their simplicity compared to other financial instruments. The brokers themselves provide all the necessary minimum to start a trader's career. The operation of options is clear from the first hours of acquaintance, and trading platforms are simplified to the maximum so that a new client does not have a mess in his head.

Of course, such a quick and easy entry into trading attracts gamblers who think only about the possible profit that can be obtained by using this financial instrument. As a rule, such people are trying in every possible way to pull the principles of the casino on Binary Options trading. Needless to say, the results of such manipulations lead to serious financial losses for almost all those who like to take risks.

The casino originated with the aim of making money on draining customers, but Binary Options originated from a real exchange asset - this is the difference. Yes, even if both there and there the owners profit from the loss of customers, but the difference in everything else is huge. There are both pros and cons for clients.

And in terms of reliability, Binary options are very much ahead of their competitors - in the form of an online casino. Binary options are regulated, sometimes even by several companies at once, which forces them to follow the rules of "fair play" and pay out profits to all who earn. An online casino does not have such regulation and, in fact, can not only adjust the drain on your trading balance, but also refuse a well-deserved payment.

Probability of winning in casino and binary options

Of course, binary options trading is very similar to playing in a casino. One of these similarities is the probability of winning.

For example, let's take a look at how roulette works in a casino. When betting on black, we immediately cover 18 cells of the playing area out of 36 - the probability of a correct prediction is 50%. But there is also a “0” on the field, it turns out that the probability of a correct forecast is slightly less and is already 48.65%. A probability of less than 50% indicates that without additional strategies, the client will always only lose.

Probability of winning in Binary options and casinos

But the result of trading on Binary Options very much depends on your attitude to trading. If you think that this is a game, then the results will be similar to those of playing in an online casino. It is very difficult to stably guess the further direction of the price, so for a long period of time, the client will incur losses.

Adding to the complexity is the fact that in binary options trading it is necessary to conclude more than 55% -60% of profitable transactions (depending on the broker) in order to get a profit. The required percentage of profitable trades can be calculated using the formula:



K - the percentage of profit for a correct forecast with your broker.

Roughly speaking, in order to trade on Binary Options in a plus, you need to conclude at least 6 profitable trades out of 10. The problem is very tangible, especially if there is little or no experience in trading.

So maybe it’s still better in a casino where the payout at the right bet is 100%? Why fill your head with unnecessary problems?

Binary options brokers or casinos: where do they pay more?

If we take for example the same game of roulette in an online casino, then when winning a single bet, the client receives a net profit of 100% of the investment amount. So what about binary options? On BO you can consistently find brokers who are willing to pay 70-80% for a correct forecast. At best, you can find a broker who is willing to pay 90-95%, or switch to more profitable types of options that are much more complicated than classic ones.

Such prospects. Over a long period of time, these very 5-30%, which the Binary Options broker underpays, form a tidy sum. This is in terms of profit. If we talk about risks, then they are also much greater here, because. For one losing trade, you need to make two in the black.

Where do they earn more

But what is the reason for this difference in payment? Casinos, like Binary Options Brokers, make money from the loss of money by their clients. But the casino pays more. Let's figure it out.

An online casino (namely, we take it as a guinea pig) operates according to its own personal rules. All monetary transactions take place within the trading (or gaming) platform of the casino. All these attempts to prove the honesty and transparency of the casino operation to the client come down to the fact that it is not possible to check the real operation of the casino.

Yes, you can be told about data encryption, pre-prepared numbers that will fall out on your roulette wheel, even provide these encrypted data - “Look, the program generated numbers even before you started playing and they fell out strictly in order of priority!”. But any experienced programmer will tell you that this is a simple trick and the casino software is designed in such a way as to initially let the client win, and then take everything. There is no question of any transparency, and the risks for casino owners are also out of the question.

Simply put, the casino lures customers with sweet 100% payouts for a correct prediction, but in fact it can easily change the number or sequence right during the game, after receiving data about your bet, but before the publication of the results - a matter of seconds and it's done, and the client's money is flushed down the toilet. And, I'm not kidding - that's exactly what happens.

Undoubtedly, there are official gaming machines in online casinos, the software of which is configured by the manufacturer himself - for this there are special certificates confirming that the internal code of the program will not be changed and the game has adequate chances for the client. But there are only 2-3 such slot machines for all online casinos, and there are 50-100 games in the casino. Do you feel the scale? An inexperienced user will never distinguish the original from a fake that was programmed to drain players.

Thus, the probability of making money in an online casino tends to 0, and as an advertisement, they can increase profitability up to 200% - all the same, the risks are negligible and everything can be tweaked at any time.

So what about binary options? Why is the percentage of profit for a correct forecast almost always less than 100%? The fact is that Binary Options are based on a real financial instrument. All binary options brokers allow you to make predictions on the direction of the price of different assets. Feel the difference? "The direction of the price of different assets!".

The current price of various assets is known to everyone - it can be viewed on resources that do not belong to binary options brokers. This is a kind of guarantee that the broker will not set up a trick for us by changing the code of its trading platform.

Quotes are the same everywhere

In fact, many traders do price analysis on third-party platforms, and binary options brokers only open trades - the results are not even bad. All major price movements are the same across all binary options brokers and third party price charting platforms. Of course, there is a difference in quotes on different sites, which creates moments when the broker’s transaction closed in the red, and according to the information on the third-party chart, the transaction should have closed in the black. But there are also reverse moments, when on a third-party chart the price turned against your trade, and the broker's quotes have not yet had time to catch this price movement and the trade closes in profit. In general, this is normal.

In addition, all these inaccuracies can be avoided by trading with a longer expiration time, where strong price movements are more felt. In such a trade, you will not care a couple of points difference if your trade is deep in profit.

And yet, why do binary options brokers have a payout percentage for a correct forecast less than 100%? Everything is done within the framework of the security of the broker itself from complete ruin. Experienced traders can make about 70-80% of profitable forecasts, which will allow them to consistently earn even with a payout of 60% for a correct forecast. Moreover, professional traders do not earn a penny at all, which is already very hard on the pocket of binary options brokers.

On the side of the trader there is knowledge, thanks to which you can reach a stable income without the risk of loss, and open information about price movements does not allow the broker to cheat and merge the trader. In order to somehow equalize the chances between the trader and the broker, the latter came up with the idea of lowering the yield of options.

If in an online casino the winnings depend entirely on luck - whether the program has managed to adapt to draining your balance or not yet, then on Binary Options success depends only on the skills and knowledge of the trader himself.

Application of casino strategies in binary options trading

The payout for a correct prediction of less than 100% on Binary Options has prompted many clients to use strategies in trading that are used when playing in a casino. This choice is obvious, because many strategies are indeed prohibited in real casinos, because they are very profitable for the player himself.

Binary Options Martingale Strategy

The most famous and popular strategy for Binary Options that came from playing in the casino is the Martingale strategy. The essence of this strategy is that after each incorrect forecast, the amount of investment doubles. Thus, the trader expects that one single profitable trade will cover all previous losses and bring some profit.

Indeed, the Martingale betting strategy allows you to consistently earn money in honest casinos, where the probability of a correct prediction increases with each new bet - a series of incorrect predictions cannot last forever, especially with equal chances of the outcome of the transaction.

I already wrote a long article about the Martingale method, so you can read more about this bid management method. Well, for now, we will visually depict the application of this method in trading:

Martingale strategy in binary options

Let's say you started trading with $100, your prediction turned out to be wrong. In this case, you double the amount of your investment. This algorithm is maintained until the first profitable trade, which covers all losses and brings a small profit. After that, the series starts from the beginning - from the sum of $100.

Provided that you have an unlimited deposit, the Martingale system is a win-win. The main disadvantage is that Martingale does not provide for any loss limit. Due to the fact that traders' deposits, as a rule, range from $10 to $20,000, a series of several losing trades can completely drain the entire amount on a trader's trading balance.

Fibonacci Strategy in Binary Options

The Fibonacci strategy is another bet management strategy that came to Binary Options from the casino game. It is also used by traders in their trading. If we compare the Fibonacci strategy and the Martingale strategy, then the latter is more aggressive and risky.

The Fibonacci system increases the size of the investment amount more smoothly and gradually, in accordance with the proportions of the Fibonacci sequence. As many of you know, the next number in the Fibonacci sequence is the sum of the previous two numbers - this is the sequence that is used in this trade management method. Each profitable trade covers the losses of the last two trades.

Rules for using the Fibonacci strategy:
  • In case of a correct prediction, the amount of the bet remains unchanged
  • In case of loss, the bet amount is increased according to the Fibonacci sequence: 1, 1, 2, 3, 5, 8, 13, 22, 35 and so on.

Fibonacci strategy in binary options

This strategy combines the features of the Martingale strategy, but at the same time is less risky. With a large number of losing trades, the use of this strategy can also lead to a complete drain of the trading balance.

Binary Options Pyramid Strategy

The pyramid strategy is another strategy for increasing the amount of investment with a losing forecast, which came to Binary Options from gambling. The strategy also has increased risks, but they are much less than when using the Martingale strategy or the Fibonacci strategy.

The essence of the Pyramid strategy is as follows:
  • After each losing trade, the amount of the new investment is increased by one - the amount of the original trade
  • After each correct prediction, the amount of the new trade is reduced by one, equal to the original amount of the trade

Pyramid strategy in Binary options

The advantage of this strategy is that the size of the bet grows or decreases exponentially. The disadvantages are the same - an increase in losses in a number of unprofitable transactions, but also a very important plus - a decrease in risks if transactions are often closed in profit.

But it is always worth remembering that no bid management strategy will allow you to earn money without correct predictions. You will still need to analyze the charts and make more profitable trades than losing ones, and rate management strategies will help you get the most out of your trading.

How to make a lot of money with Binary Options

Due to the fact that Binary Options is very similar to playing in a casino, and they have similar mechanics, almost any trader has a streak of luck and a streak of failure. Moreover, you never know which lane is present now.

The game has such a thing as "Beginners are lucky!". Ever wondered where it came from? When a person starts doing something new (playing in a casino, poker, binary options, etc.), then he simply does not have the fear of loss that appears after the first failures. But until this happens, the player is head and shoulders above all more experienced competitors, because he considers the situation from a completely different angle.

He still does not have thoughts like “What will happen if I lose?”, “Suddenly I get into debt”, etc., he, at the subconscious level, does what a professional player or trader should do - to fully concentrate on the search for opportunities and their analysis.

It often happens that a newly-made trader, who has sat down for trading for the first time, earns an amount that even experienced traders with more than one year of trading will envy. It happens that you are just lucky and prediction after prediction turns out to be correct. On such an impulse, you can really make very large sums.

I remember a similar experience. I came across a heat map of currencies and a strategy based on them. According to the strategy, it was necessary to open trades against the trend. The heat map showed where the price was moving at a certain price range:
  • The red color of the cell indicates that there was a downward movement
  • Green indicates an uptrend
The whole point of the strategy was to catch pullbacks in trend price movements. In such trading, I did not even see the price charts of the asset - only the heatmap table.

Heat map of currencies

Everything looks very simple - the strategy was just for my trading mindset at that time. What was my happiness when I increased my trading balance from $200 to $840 in a day using this method. About 90% of transactions went into plus, which brought me a very large profit.

The next day came and I decided to continue trading again. Looking forward to another tasty piece of freebies, I began to trade exactly the same trading method as the day before. As you may have guessed, the results of trading were so terrible that on the first strong trending price movement, I not only lost everything, but also lost another $200 deposit.

Luck can't last forever! Someday it leaves us and then either you are prepared and able to rely on your knowledge and experience, or you lose everything at once. I described my case, but this situation happens to everyone who randomly snatched a large sum. There are practically no exceptions - everything that is earned randomly (just lucky) is returned to the broker within a few months, and then their money is given to the same broker.

Key difference between casino and binary options trading

In the game against the casino, you are initially at a disadvantage. The casino owner wants to take away all your invested money and does not want to share his own. In this situation, what can you do? What can you do against a program that is ready in advance to change the result depending on your bet? In gambling and casinos, luck is your only ally.

difference between Binary Options and Casino

It is luck that will determine whether you will earn today by playing roulette, or the casino software will notice your activity ahead of time, after which it will start to shove sticks in the wheels in every possible way. Here it is already worth rejoicing if you have remained with your own - there can be no talk of profit.

Luck in binary options, on the contrary, is not the best ally. Once lucky and the trader begins to believe in his success, and then loses all profits and adds more from his pocket. A random result in binary options trading is not at all a result that you can be proud of and brag about. Tomorrow your luck will run out, and what will you do?!

But if in a casino game, the result always depends on luck, then in binary options trading, the result can always be swayed to your side. You just need to gain experience and knowledge. But many do not need this - they are terribly lazy in order to study something, practice, and only after that get something. Only one thing is important for everyone - to get a lot of money right now.

An experienced trader always relies on his knowledge and experience - this is the key to sustainable success. A typical binary options broker client relies only on chance and luck, and as soon as this luck ends, he loses everything without a trace.

Gambling beginners or whose money professionals earn

Any gambler is a godsend for every binary options broker. It is not surprising that the advertising campaigns of brokers are designed in such a way that they cover the gambling audience:
  • Binary options broker ads can be seen very often on gambling and casino resources
  • The advertisement itself is made in such a way as to interest gambling people - "Earn 8,000 thousand in just 1 minute!"
Gambling people who have become clients of a binary options broker immediately find the differences between BO and casino:
  • Binary options use real price movement, casinos use hidden computational processes
  • In Binary Options you can earn by choosing the right expiration time. In the casino, the result is calculated instantly and depends on luck.
  • Almost all binary options brokers have a regulator that can put pressure on the broker to fulfill his obligations to the client. The casino does not guarantee the safety of your funds.
Advantages on the person, but here it all the same does not give a practical plus. Gambling traders are always trying to make money using various bet management strategies (Martingale, Fibonacci, etc.), they are not able to stop at losses - they are always trying to win back.

An experienced trader, on the contrary, always stops large losses by sacrificing "little things", earns steadily and manages his capital without the risk of losing everything. Where a gambling trader loses money, an experienced trader earns.

In fact, gambling traders feed professionals by giving part of their money to successful traders, and part to the broker himself. A food chain in which the gambler is at the lowest rung and is not able to eat anyone, but at the same time he himself is food for everyone.

And what is there to hide, about 85% of all traders are very gambling people who want a lot of dough here and now. On their backs, like parasites, sit experienced traders and brokers who earn huge amounts of money every day. Well, what to do? In the world of Binary Options, you are either a predator who did not waste his time on learning and gaining experience, or a victim who does not want to learn anything and came to play.

All or Nothing in Binary Options

One of the biggest differences between a professional trader and a beginner is patience. An experienced trader is ready to wait, even ready to give the broker part of his money, with full confidence that a little later he will still earn his money.

A beginner is more adventurous - it is important for him to make a profit here and now. Moreover, even after receiving this profit, the novice trader does not stop - he is driven by the force "I want MORE!!!". As a result, greed destroys any undertakings.

But, back to the main question of this article - are Binary Options casinos or not? Strange as it may seem, there are two answers here:
  • If you are a gambler, then Binary Options is a game of chance or a casino for you. Your chances of success depend entirely on your luck and luck. But luck may run out - then you will return all your profits to the broker and add on top from your pocket
  • If you are able to curb your greed and be patient, then Binary Options will become a very profitable business for you, in which you will always come out the winner
That's all. It all depends on your perception and opinion on the Binary Options account. If you want to see them as a game - you will play, if you want to see BO as a financial instrument - you will earn consistently.

It depends entirely on you on which side you find yourself: whether you will feed the broker and experienced traders, or you yourself will start taking money from the same broker and more gambling colleagues.
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