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Rating Formula

Binary Options Rating Formula v.3.5

BROKERS FORMULA v.3.5

What is about?

The introduction of the Rating Formula v.3.5 is serving an important mission. This mission is to provide a 100% objective framework to evaluate and to rate the world's binary option brokers. Until today, brokerage services were rated by individual users. But most of these user ratings in the trading industry are not honest. Anyone who has an incentive to do so, may produce a fake rating / review. Prove comes from the fact that most individual user ratings are given extreme values such is 10/10 or 1/10. It is hard to believe that these extreme ratings have been produced by honest users. This is why the Rating Formula Series was designed in the first place. By rating brokers in an objective way users are able to choose the brokerage service that suit them best. Furthermore, users are able to identify trading aspects that they weren't aware of and thus enhance their knowledge upon trading.

History:

The first and the second versions of the Rating Broker Formula were applied on Online Forex Brokers. The version 3.0 of the formula was applied on Binary Option Brokers. More information here:

» Forex Broker Rating Formula V.4.0, at TradingCenter.org

» Binary Option Brokers Formula V.3.0, at BinaryValue.com

 

World Brokers Rating Formula V.3.5  Rating Brokers Formula

-Implemented on Binary Options Brokers 

The rating formula v.3.5 is built by linking together four major trading factors: 

1) Max Safety of Funds

2) Min Commissions and Fees Charged

3) Max Number of Trading Options

4) Max Technological Efficiency

 

Read more: Binary Options Rating Formula v.3.5

Rating Brokers Formula V.3.0

OPTIONS BROKERS RATING FORMULA 3.0

 

Note: there is a newer version available in this site

 

What is about?

The introduction of the Rating Formula is serving the mission to provide an objective framework to valuate world online brokers. Until now online brokerage services were valuated and rated only by users. But most user ratings in the trading industry don’t seem to be honest. Anyone who has an incentive may produce a fake review / or rating. Prove derives from the fact that most user ratings take extreme values like 5/5 or 0/5. It seems like most of these ratings are not made by real users. We must note that User-Rating sites like Forex Peace Army do their best to ensure that user ratings are not fake, but given the results, it seems like extremely difficult task. Using an objective way with common rules to rate and compare brokers is what the Rating Brokers Formula is all about. Maybe someday in the future, regulatory authorities in the internet will use a similar formula to control and to force brokers to operate in a way favour to internet users. Furthermore, to force brokers to act in the direction of minimizing the whole systemic risk of the industry.

History:

The first and the second versions of the Rating Broker Formula were applied on Online Forex Brokers. More information here:

» Binary Option Brokers Formula -V.3.5, BinaryValue.com

» Binary Option Brokers Formula -V.3.0, BinaryValue.com

» Forex Broker Rating Formula –V.2.0, TradingCenter.org

» Forex Broker Rating Formula –V.1.0, OnlineForex.Biz

 Rating Brokers Formula v.3.0

World Brokers Rating Formula V.3.0

-Implemented on Binary Options Brokers 

 

The rating formula v.3 is build by linking together four major trading factors:

 

1) The Maximum Safety of Funds

2) The Minimum Commissions and Fees Charged

3) The Maximum Number of Trading Options

4) The Maximum Technological Efficiency

 

 

FACTOR 1) Safety of Funds, Weight 20%

When trading online, ensuring the safety of your funds becomes the most crucial factor to consider before you open a real trading account. Financial companies (investment companies, brokerages etc) sometimes tend to accept risky decisions in order to gain market share or boost their company’s profitability. That is against the interest of their traders who are by nature risk-averse concerning their funds safety. In order to measure credibility some rating filters have been developed.

Table-1: Safety of Funds Analysis

1. RELIABILITY

WEIGHING ANALYSIS

MAXIMUM WEIGHT

1.1 Years in the Market

0-1 Years = 0%, 1-3 Years = 6.0%, 3-5 Years = 8.0%, 5+ Years = 10.0%

10.00%

1.2 Headquarters Base

Offshore = 1.0%, Cyprus = 5.0%, Ireland, Australia = 8.0%, USA, UK, Germany, France, Switzerland = 10.0%

10.00%

1.3 Level of Regulation

FSC (BVI) = +1.0%, CYSEC = +3.0%, CBI = +4.0%, ASIC = +4.0%, BaFIN = +5.0%, FSA (UK) = +5.0%, FINMA = +5.0%

(+5% max)

1.4 US Traders

Yes = +2.0% or No = +0%

(+2% max)

 

TOTAL =    

20.0%

 

FACTOR-1 ANALYSIS:

1.1 Years in the Market, 10%

Many years in the market indicate that a Binary Option Company operates under a successful business model and that it is proven capable of managing the whole enterprising risk over time.

1.2 Headquarters Base, 10%

The country where a binary option broker maintains headquarters determines the quality and consistency of its balance sheet. Fees and penalties imposed by supervising authorities provide a strong incentive for Options Brokers to operate legitimately without risking their client funds.

1.3 Regulation, (+5%)

As the Binary Options Industry is very young, regulation is not yet an industry standard. Lately, some Binary Options Brokers have managed to achieve some basic regulation, so this factor is also incorporated to our ratings. An extra rating (up to 5%) is added to those Binary Options Brokers who are supervised by a trusty regulatory authority.

1.4 US Residents Allowance, (+2%)

The acceptance of US residents indicates compatibility with US regulation, which after 2008 became strict for financial companies. US regulation adds credibility to a Binary Option Broker operation.

Read more: Rating Brokers Formula V.3.0
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