With the writing is on the wall for binary options, many brokerages are choosing not to abandon ship altogether, but rather just jump ship from binary to forex.
Yes, they’re completely different financial instruments, but as crazy as the idea sounds, the traders themselves may not be such different people. The factors that attract traders to binary options can be emphasized, and in some cases replicated, in forex trading. In this article we consider ways that binary options brokerages can use their existing marketing tools to now target forex traders, as they prepare to make their jump.
The same traders who are attracted to binary options because of its online accessibility are also likely to be attracted to forex for the same reason. Both trading instruments tend to be traded online and have the flexibility of being traded at any time, as long as the underlying asset market is open.
This aspect of online accessibility which you are likely to already be emphasizing for your mobile trading apps should be applied to how you market your forex services. Profits can be made for both financial instruments by seizing a golden opportunity whenever it comes up. Promote your ability to help clients keep their finger on the financial pulse, and you’ll keep your clients interested in knowing more.
Trade on Small Capital
Unlike many of the other trading instruments, be they commodities, indices, stocks or futures, the benefit of trading in forex, like binary options, is that it only requires a very small amount of initial capital. The typical amount for a trade in both these industries is $100 and very often even less than that. Due to risk considerations in both instruments, traders tend not to want to place a lot on each individual trade, however this tends to inform their trading style, which will transfer nicely into forex.
The differences between trading binary options and forex can be addressed in how you support your traders in developing their trading strategy. A major difference between forex and binary options is the variability. In binary options you know your risk and reward potential from the outset, in forex you don’t. But what you can do in forex is develop a trading strategy with clear stop loss and profit margins, so that the trade is sold as soon as one of these is hit, limiting the potential for a loss to escalate.
Marketing campaigns should focus on helping clients to develop robust trading plans. This can include blogs on tips for developing trading plans, informative videos on implementing a trading plan and promoting the use of a forex demo account for clients to ascertain their trading style.
Simplicity and Transparency
Most binary option traders are attracted to the simplicity and transparency that comes with trading this instrument. To attract these same clients into forex, you need to break down forex trading into its most simple elements.
To enhance the trader’s perception of transparency, you can explain the benefit of setting the boundaries of their trade themselves where they can predetermine the amount of risk that they are willing to take on. And on the subject of risk, you should also emphasize the better odds in forex trading where you can win the full amount set in your profit margin, whereas in binary options a win typically only pays out 60% to 80% of your trade.
This article was written by Yael Warman, Content Manager at Leverate.