There are different types of stocks options in Canada as in many other countries, and there are very few of them that come with guarantee when it comes to return on investment (ROI). In case of binary options, there is a chance that an investor could lose everything and there is also a chance of the investment doubling or even trebling within a very short period. Of course there is also room for the investor to get the exact refund of money invested in the binary options.
Whatever level of risk involved, one thing that governments across the globe have realized is that if the stock market is left unregulated, or if the environment is such that regulations on handling binary options and other stock options are flouted, it poses a huge risk to the economy as a whole. As seen in the years towards the end of the last millennium and the beginning of this millennium, abuses in any financial or trading sector, especially in the big economies, do not just negatively affect the country’s economy but also the global economy. That is why even when binary trading and trading in other stocks is not government responsibility, the government must monitor the market for the greater good.
Is There A Specific Law For Binary Trading in Canada?
Binary options Canada is more or less a free market. Of course the law applies as far as licensing of binary option brokers is concerned, but other than that, there is no particular statute that limits the number or category of entrants into the market. In fact, as long as you are doing business in Canada legally, you can participate as an investor in binary options or even as a licensed binary options broker. Canada’s licensing criteria differs from the US in that the market is not a locals’ only zone. Though the US took the lead in taking the step to license binary options brokers, it has continued to protect its few licensed brokers, and that in effect stifles competition.
From experience, therefore, Canadians wishing to engage in binary trading would rather they used a binary option broker registered within their own country or even in Europe. And the logic is simple: wherever competition is high the investor is bound to benefit more. One thing worth noting is that although binary options do not feature specifically in the Canadian laws, Canada falls under the top binary options global markets. Binary trading is legal in Canada; only that the laws do not single it out for mention in the books.
How Protected Is The Investor In Binary Trading?
Binary options Canada are safe to trade in. It is, however, important to be diligent before releasing any money to a broker, and confirm that you are dealing with a good, if not the best binary options broker within your area. Not only is it important to ascertain (unregistered) that the binary options broker is duly licensed, but that his or her firm has a history of cushioning investors from absolute losses. As already noted, great binary option brokers have a record of paying some set percentage of money invested to traders who end up losing in trade. Most people who are versed in binary trading within Canada readily recommend using a binary options broker who is registered and licensed locally, in Europe, or in the US. That way you do not expose yourself to unscrupulous brokers who could swindle you and make you spend more in legal battles. But generally, investors in binary options in Canada have a safe market. In fact, there is a list of Canadian companies online that are operating legally, and from where you can select the best binary options broker to work with.