Nadex Review

Summary

Due to strict regulation around Nadex operating from the U.S. and with U.S. citizens as clients the broker is not able to offer any bonuses. The trading platform software is, while simple because binary options are a simple derivative, more complex than many other platforms because of the more professional nature of the product supported and the fact that it is a DMA exchange rather than a market marker. However, the software is very good and for what it achieves keeps things as usable and simple as realistically possible.

Customer support and general customer safety of funds is unrivalled. The only minor complaint might be that support in not offered in languages other than English despite the fact that traders from a significant number of countries around the world can open an account. With over 2000 tradable instruments offered, not binary options brokerage has a better range of choice available to traders.

 

Nadex Intro

Binary options have been the fastest growing form of financial markets trading over the past several years. The alternative financial derivative’s simple nature, with traders knowing their potential profit and potential loss at the point they take out an option, no leverage available to take potential losses beyond the initial investment and only two potential outcomes possible, win or lose, has proven a popular format.

Binary options appeal most to less experienced traders as an easier to understand and execute introduction to trading. However, there are also more experienced traders who also choose to trade binary options, either as a stand-alone derivative or in combination with other formats such as CFDs trading or spread betting.

The rise in popularity of binary options traders has been mirrored by a rise in the number of brokers offering binary options trading platforms. With a great deal of choice when it comes to deciding upon a broker to trade with, traders also now have more research to wade through to arrive at a conclusion. In this section we aim to take some of the pain out of that process by providing the most important information on brokers such as company background, trading platforms and terms. Here we look at Nadex, one of the few binary options brokers able to offer binary options on the U.S. market.

Company Information

Nadex is the North American unit of IG Group, the UK’s biggest CFDs, spread betting and binary options broker and is regulated by the Commodity Futures Trading Commission as a financial exchange. Regulation of binary options brokerage is extremely strict in the U.S., and only CFTC-regulated exchanges are able to work with U.S. citizens. Nadex does not only work with U.S.-based traders though and other internationally-based binary options enthusiasts are able to take advantage of the tight regulations that apply to the broker such as its DMA and segregation of client funds in top tier US banks.

 

Trading Software

Nadex’s trading platform is browser-based and is compatible across Windows, iOS and Linux operating systems. While still relatively simple due to the inherent simplicity of binary options, Nadex’s trading platform looks a little more like a traditional trading platform than those of many binary options brokers. It’s not quite the one-screen, super-simplified platform binary options traders might be used to as the more professional approach required by U.S. regulation means it’s a more professional product that gives traders greater control.

Nonetheless, the platform is still simple to work with and well-designed.

 

 

Additional functionalities that most binary options brokers don’t support because they are the market maker and not only the exchange, such as depth of market and advanced orders, are a feature of the trading platform but easy to get to grips with. Real time data and a charting package for technical analysis will also be appreciated by traders.

 

Mobile

The platform’s mobile apps, for Android and iOS mobile devices are very high quality. Designed specifically for touch-screens and not just smaller screens, pinch and zoom charts and being able to draw and annotate on them with a finger all adds to the experience.

 

 

Cloud-based data management also syncs the desktop and mobile app platforms so traders can open a trade on one platform and then manage on another as long as logged-in to the account on both.

 

Assets Available

Binary options traders will not find a broker that provides a more complete range of tradable instruments than Nadex, with over 5000 available. Forex, including Bitcoin, commodities and global equity indices are all asset classes on Nadex, each with a significantly broader depth of options than is common for binary options brokers. One particular highlight is the fact that events can also be traded so a binary option can be taken out on the result of upcoming jobless claims or interest rate rises.

 

Trading Features, Fees and Payouts

Because Nadex is an exchange rather than a binary options market maker, the broker has, unlike most other binary options brokers, no direct interest in whether a trader wins or loses a trade. Nadex matches buyers with sellers of options so the market prices the option. The less chance the market things the option has of finishing ‘in-the-money’ the higher the payout. One major difference with Nadex binary options is that the trader can sell the option whenever they want prior to its expiry to either lock-in profits or reduce a loss if it looks inevitable.

Nadex makes its money by charging a $1 fee per binary options contract on both entry and exit of the trade, up to a maximum of $50. If a trader takes a particularly large binary option position of more than 50 contracts, fees are capped at $50. Wire withdrawals and returned deposits are also charged at $25 though debit card transfers are not charged.

 

Bonuses & VIP programs

Nadex does not offer bonuses of any kind as its CFTC-regulation does not permit it to do so.

 

Deposits and withdrawals

Deposits and withdrawals can be made via bank transfer, wire transfer from international accounts, by debit card and cheque (only for deposits). Credit card deposits or withdrawals are not accepted under U.S. regulatory rules. The minimum deposit level is only $250 and no minimum put on withdrawals. Fees apply, as outlined above, to wire transfers.

 

Customer Support

Customer support is available over the phone (a toll free number is available from the U.S.A) and via email. Support is available during market opening hours from 11:00 ET Sunday through to 17:00 ET Friday. Support is only supported in English.

 

Extra features and resources

The unique feature offered by Nadex is the fact that the exchange offers direct market access binary options trading. Rather than Nadex setting the payouts, they are set by underlying market demand and risk assessment for the other side of the option. Being able to close options early at any time during their lifetime is also a rare feature with binary options brokers and one that makes a huge impact on risk management.

 

Verdict

Regulation in the U.S. and offering DMA binary options trading means Nadex stands out from the crowd when it comes to binary options brokers. While the fact that the trading platform is more for ‘real’ trading than is generally the case with binary options means it is not quite so simple as many, traders still won’t have much difficulty getting used to it.

Over 2000 tradable instruments is also a major plus as is the general security and lack of hidden charges. More experienced binary options traders will struggle to find a better product or more reputable broker and beginners will also benefit from making a little extra effort and trading with Nadex from the outset.

 

Pros

• DMA access makes trading via Nadex completely transparent
• S. regulated
• Binary options can be sold before expiry
• Over 2000 tradable instruments
• Minimum $100 deposit

Cons

Slightly more complex trading platform takes a little more getting used to than many binary options platforms.

Support only available in English.

 

FAQ

Is Nadex a safe binary options broker?

Nadex is arguably the safest binary options broker in the world. Owned and operated by IG Group, the FTSE 250-listed investment broker and regulated in the U.S. by the Commodity Futures Trading Commission, no other binary options broker adheres to such strict regulatory standands.

 

What is the minimum deposit to open a Nadex Account?

The minimum deposit is $250.

 

Where are my funds held?

Trader funds that are held with Nadex are kept in segregated bank accounts at both BMO Harris Bank and Fifth Third Bank in accordance with CFTC Regulations.

 

 

TRADE AT NADEX