The Netherlands seek to ban advertising in binary options, CFDs

Discussion in 'Wall St. News' started by mlawson71, Feb 26, 2017.

  1. mlawson71

    mlawson71

    The Authority for the Financial Markets (AFM), the Dutch financial regulatory body, is the latest regulator to launch a consultation on the ban on advertisement of risky investment instruments, such as binary options, contracts for difference (CFDs), futures and warrants. The regulator emphasizes on the harm caused by instruments with leverage of 10:1 or higher.

    Consumers can lose money quickly when trading in the above-listed instruments, which the AFM calls “toxic”. Long-term investment does not yield good profits, either. The regulator’s move is an important step in the fight against harmful financial products to which retail consumers are exposed, it noted.
     
  2. :thumbsup::thumbsup::thumbsup::thumbsup:
     
  3. southall

    southall

    If these firms cant be regulated then they need to be shut down, too much risk of getting scammed and ripped off.

    However, it is not leverage that is harmful. It is people's greed and ignorance that causes them to lose large amounts of money. Addictiveness is also a big factor.
     
  4. Customers like these will go back to punting on illegal dog fights.
     
  5. Tim Smith

    Tim Smith

    Well, no, it is the leverage.

    You can over-trade as much as you like on an $80 account, but you only start loosing large amounts of money when you do so with stupid levels of leverage.
     
  6. southall

    southall

    If you stop people owning liquid instruments on leverage then they will just buy low priced or penny stocks on low or no leverage, the end result will be the same, huge losses.
     
  7. The chance to make money in penny stock is not zero.
    There is zero chance to win in binary scam or over leverage CFD by those bucket shops.
     
  8. southall

    southall

    Agree about Binaries but the quote in opening post also mentions CFDs, and Futures.

    Actually the reason why people lose on binaries (ignoring the scammers who wont payout profits) isn't because of leverage either, its because the spread is so wide making the options very expensive.
    If Binaries were priced 49-51 they would be much better chance of making money. At 42-58 (or worse), there is little chance of coming out ahead after 5 bets.
     
    Last edited: Feb 26, 2017
    JackRab and galvinlee888 like this.
  9. Those scamner (who just happen the "house" here) will continue to increase the spread until they have sure win edge.

    It is good you mention 52/48. Most of the day trader not even realised their setup is actually worst than 48/52 after they include commission & sluppage. Zero chance for them to survive in long term.
     
  10. JackRab

    JackRab

    Yeah, I agree with you there... why CFD/Futures and warrants... (which are basically options). I would say, anything that is regulated through on-exchange should not be a problem... for christs sake... that's what we pay the regulator for!!!

    But something in me says... stupid is stupid does... why trade binaries with wide markets? Stupidity can not be regulated, they will find another pit to throw their money in....
     
    #10     Feb 26, 2017