Binary Options Alternatives

While binary options are a simple and potentially lucrative form of trading, some investors will want to expand their trading repertoire to include alternative instruments. This guide explores the best alternatives to binary options, from CFDs to spread betting and futures. We also explain how these trading instruments compare to binary options, unpacking their respective merits and drawbacks. Read on for a list of the best binary options alternatives.

Best Alternatives To Binary Options Brokers

  1. Go long and short on a range of popular financial markets

    FTSE Spread
    1 pt
    GBPUSD Spread
    1.0 Var
    Stocks Spread
    0.1% (Min Commission Applies)
    Leverage
    1:200
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
    Platforms
    MT4
  2. Trade leveraged CFDs on a variety of assets including stocks, commodities and forex

    Forex trading involves risk. Losses can exceed deposits

    FTSE Spread
    1.0 pt
    GBPUSD Spread
    from 0.589 pips
    Stocks Spread
    Variable
    Leverage
    1:30
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
    Platforms
    MT4
  3. Trade CFDs on FX, stocks, indices, & cryptocurrencies

    FTSE Spread
    1
    GBPUSD Spread
    0.7
    Stocks Spread
    Variable
    Leverage
    1:30 EU, 1:500 Global
    Regulator
    HCMC (Greece), FSCA (South Africa)
    Platforms
    MT4, MT5
  4. Speculate on 40+ share CFDs with high leverage and low fees.

    FTSE Spread
    NA
    GBPUSD Spread
    NA
    Stocks Spread
    From 0.03
    Leverage
    1:1000
    Regulator
    SVGFSA
    Platforms
    MT4, MT5
  5. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    FTSE Spread
    0.005% (£1 Min)
    GBPUSD Spread
    Commission (.20 pts x trade value)
    Stocks Spread
    From 0.003 per share, variable
    Leverage
    1:50
    Regulator
    SEC, FCA, IIROC, SFC
    Platforms
    AlgoTrader, OmniTrader
  6. Use leveraged CFDs to speculate on popular financial assets with tight spreads.

    FTSE Spread
    Av. Floating 100 pips
    GBPUSD Spread
    Av. Floating 0.6
    Stocks Spread
    Floating, commissions as low as 0.01%
    Leverage
    1:1000
    Regulator
    BVI FSC
    Platforms
    MT4, MT5

Binary Options Explained

The simple definition is that binary options are a simplified type of speculation where traders make straightforward price predictions about an asset over a set period. With the most basic contracts, investors need only predict if an asset’s price will be higher or lower than its current value after the contract expires. For example, will Twitter’s share price be higher or lower than $40 in six hours?

Binary options are similar to sports or event gambling in that users stake money for a fixed-odds return. Payouts on traditional binary options can reach 95%, while a losing trade will see the investor lose their initial stake.

Types Of Binary Options

Traders worldwide can use this investment vehicle to make price predictions on a wide range of markets. However, there are significant regional differences between European-style binary options and the alternatives for US residents.

Before diving into the alternatives to binary options, here is a brief overview of the differences between the USA and European-style instruments:

European Binary Options

European or traditional binary options allow investors to stake funds on the price movement of an asset in exchange for a fixed payout if their prediction is correct. However, some binary options brokers offer alternative variants for different trading strategies:

  • Up/Down – This is the most basic form of binary option supported by most, if not all, binary options trading companies and businesses. Clients can bet either long or short to predict whether an asset’s price will be “up” or “down” from its current price at expiry.
  • One/Two Touch – With a traditional up/down variant, the payout is determined by the price when the contract expires. However, for a one or two-touch binary options contract, the price only needs to reach a price level at any time before expiry to trigger the payout. Investors can set this price level above or below the current price to go long or short on an asset.
  • Range/Boundary – Boundary options allow traders to bet on price volatility rather than direction. Investors specify a high and low cash value for their chosen asset. With these levels, traders can bet on the asset price, finishing either outside or within this range at expiry.
  • Ladder – While traditional binary options pay out a fixed reward based on a singular strike price, ladder options provide several strike prices, each with different payouts. This allows investors to make extra profit from more significant price movements.

US-Style Binary Options

US-style binary options, also sometimes referred to as fixed-return options, differ because they are exchange-traded rather than sold over-the-counter (OTC) by individual brokers. This gives investors more flexibility to exit positions early and provides traders with additional security.

All US-style binary options offer a set payout of $100 per contract, with investors profiting from the difference between the price paid for a contract and the set final value.

Brokers often make their money from commissions for buying, selling and settling winning trades, similar to some of our binary options alternatives.

Markets

Binary options offer access to an excellent range of markets. However, it is worth noting that none of these assets are owned during the trade. Binary options are simply derivatives with which to speculate on price movements.

Here are some of the markets that binary options traders typically have access to:

  • Forex – Investors can bet on price movements on major, minor and sometimes even exotic currency pairs.
  • Indices – A good range of global indices are usually provided for speculation, from the FTSE to the S&P.
  • Commodities – Popular commodities such as gold, silver, and crude oil are often provided by binary options brokers.
  • Stocks – Almost all brokers offer major USA-based equities instruments. However, those looking for EU, UK or Asian offerings may find it harder to find a provider.
  • Cryptos – Cryptocurrencies are well-suited to binary options speculation due to their volatile and heavily momentum-based trading. The best binary options brokers will provide crypto assets such as Bitcoin, Ethereum, Bitcoin Cash and Ripple.

Note, not all of the binary options alternatives listed below offer such wide market access.

Best binary options alternatives
Trading Binary Options On Focus Option

Pros Of Binary Options

Here are some of the reasons that binary options are popular with global investors:

  • Simple – The mechanics of binary options are easy to understand and suitable for beginners.
  • Capped Losses – No matter what style or variant of binary options you trade, your losses can never exceed your stake.
  • Big Payouts – Traditional binary options do not discriminate based on the size of a price movement, meaning investors can bank up to a 95% payout for even the smallest price movement.
  • Demo Accounts – Many of the best binary options brokers offer risk-free demo accounts to help clients learn the ropes. This is far harder to do using some of the binary options alternatives.
  • Customizable – Binary options traders can specify expiry times ranging from as low as 3 seconds up to months with some providers. Additionally, several variants are available suited to different market conditions or prediction types.

Cons Of Binary Options

Here are some examples of why traders may prefer alternatives to binary options:

  • Limited Payouts – Brokers always have the edge over traders with payouts usually reaching only 95%.
  • Pure Derivative – Traders do not own any of the underlying assets when trading binary options. This restricts opportunities for staking or dividend investing.
  • Largely Unregulated – It can be hard to find a good binary options broker. For binary options traders outside of the USA, brokers are mostly unregulated and scams are rife with a hefty blacklist of fraudulent providers. This is not the case with many of the binary options alternatives below.
  • Limited Platforms – Many proprietary binary options platforms are designed with simplicity in mind. Traders do not normally have access to comprehensive technical analysis tools and signals found elsewhere.
  • Missing Markets – Most brokers only offer markets on major USA company stocks, leaving global equities unrepresented. Additionally, less common commodity markets such as coffee, grain or palladium are often not normally featured.

Binary Options Brokers

  1. Pocket Option offers short term binary options on a beginner-friendly platform with competitive payouts.

    Min Deposit
    $50
    Payout %
    96%
    Expiry Times
    1 minute - 4 hours
    Bonus
    50% deposit bonus
    Platforms
    MT5
    Instruments
    Crypto
  2. Quotex offers online binary options on a range of markets with a welcome bonus for new traders.

    Min Deposit
    $10
    Payout %
    98%
    Expiry Times
    1 minute - 4 hours
    Bonus
    30% deposit bonus
    Platforms
    Own
    Instruments
    Forex, Crypto
  3. Nadex offers real-time market action with short-term binary options trading. Trade on contracts that expire after 5 seconds.

    Min Deposit
    $250
    Payout %
    Exchange (See Full Review)
    Expiry Times
    5 seconds - 1 week
    Bonus
    -
    Platforms
    Own
    Instruments
    Forex
  4. Trade American and European digital contracts with high payouts up to 100%.

    Min Deposit
    $1
    Payout %
    100%
    Expiry Times
    1 minute - 7 days
    Bonus
    100% Deposit Bonus
    Platforms
    MT4, MT5
    Instruments
    CFD, Forex, Crypto
  5. InstaForex offers intraday and expiry binary options on gold and silver, currency pairs, plus stocks and shares.

    Min Deposit
    $/€1
    Payout %
    Variable
    Expiry Times
    1 minute - 1 month
    Bonus
    30% - 100% Welcome Bonus
    Platforms
    MT4, MT5
    Instruments
    CFD, Forex, Crypto

Alternatives To Binary Options

Many alternative instruments offer solutions if binary options do not fulfil your trading needs. While this list is not exhaustive, some examples of the most popular and valuable binary options alternatives are:

Binary Options Alternative 1: CFDs

Our first binary options alternative is contracts for difference, or CFDs. CFDs are hugely popular trading instruments for forex and commodity markets. Similarly to binary options, investors have no ownership of an underlying asset and only trade on its market price.

Unfortunately for American investors, CFDs are heavily restricted in the US. However, in this article, there are other binary options alternatives listed that are available in the US.

Markets

This binary options alternative boasts a more comprehensive selection of markets, partly due to the many more brokers offering CFDs than binary options.

Using CFDs, traders can speculate on major, minor and exotic forex pairs, indices, stocks, ETFs, commodities, cryptos, bonds and interest rates markets.

Complexity

CFDs are slightly more complex than binary options despite being governed by the same principles of going either long or short on an asset. However, investors need not be experts to open a CFD trade.

The positive side of this added complexity, traders have more order types to choose from to create more precise positions.

Profit & Loss Potential

CFD trading promises the potential for far greater payouts through leverage. Some global CFD brokers offer leverage of 1:500 or even higher.

However, with greater potential for reward comes greater risk. Losses are not capped and can quickly wipe out significant capital when trading using high leverage. Our excerpts advise investors to use tools like a stop loss or trailing stop to minimize losses on CFDs.

Fees & Commissions

CFDs can be a cost-effective way of trading versus some of the other binary options alternatives outlined below. Typical broker fees are competitive and charged either through commission or are contained within the spread of a product.

However, customers should ensure that their broker has no hidden charges such as inactivity, deposit, withdrawal or platform fees.

Safety & Regulation

Regarding safety, CFDs rank higher than binary options due to a higher proportion of brokers being regulated.

However, this is not to say that fraudulent CFD brokers do not exist. For maximum protection, prospective clients should favour brokers regulated by a reputable body such as the FCA or ASIC.

Strategies

CFDs may have the least strategies available of all the binary options alternatives in this guide. Investors must ultimately pick between going long or short on an asset. While hedging is possible, other instruments are better suited to this strategy.

CFD Brokers

  1. Go long and short on a range of popular financial markets

    FTSE Spread
    1 pt
    GBPUSD Spread
    1.0 Var
    Stocks Spread
    0.1% (Min Commission Applies)
    Leverage
    1:200
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
    Platforms
    MT4
  2. Trade leveraged CFDs on a variety of assets including stocks, commodities and forex

    Forex trading involves risk. Losses can exceed deposits

    FTSE Spread
    1.0 pt
    GBPUSD Spread
    from 0.589 pips
    Stocks Spread
    Variable
    Leverage
    1:30
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
    Platforms
    MT4
  3. Trade CFDs on FX, stocks, indices, & cryptocurrencies

    FTSE Spread
    1
    GBPUSD Spread
    0.7
    Stocks Spread
    Variable
    Leverage
    1:30 EU, 1:500 Global
    Regulator
    HCMC (Greece), FSCA (South Africa)
    Platforms
    MT4, MT5
  4. Speculate on 40+ share CFDs with high leverage and low fees.

    FTSE Spread
    NA
    GBPUSD Spread
    NA
    Stocks Spread
    From 0.03
    Leverage
    1:1000
    Regulator
    SVGFSA
    Platforms
    MT4, MT5
  5. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    FTSE Spread
    0.005% (£1 Min)
    GBPUSD Spread
    Commission (.20 pts x trade value)
    Stocks Spread
    From 0.003 per share, variable
    Leverage
    1:50
    Regulator
    SEC, FCA, IIROC, SFC
    Platforms
    AlgoTrader, OmniTrader
  6. Use leveraged CFDs to speculate on popular financial assets with tight spreads.

    FTSE Spread
    Av. Floating 100 pips
    GBPUSD Spread
    Av. Floating 0.6
    Stocks Spread
    Floating, commissions as low as 0.01%
    Leverage
    1:1000
    Regulator
    BVI FSC
    Platforms
    MT4, MT5

Binary Options Alternative 2: Vanilla Options

Vanilla options are a popular derivative due to their high payouts and ability to cash settle. This also makes them one of the best alternatives to binary options.

Markets

Options are a primarily US-focussed instrument for making predictions about single stocks. Also available are indices and some commodities.

Complexity

Understanding regular options is more complex vs learning binary options. Contract prices are determined by a set of complex variables referred to as the Greeks, and investors need to be equipped with knowledge of financial concepts such as implied volatility and hedge ratios.

Profit & Loss Potential

Unlike binary options, there are no limits on the profit investors can make with a successful options trade. Options contracts also contain high innate leverage, with one contract based on 100 units of an asset.

However, with this potential for high rewards comes unlimited risk.

Fees & Commissions

Several brokers specialize in low-cost options trading– shop around to find competitive fees and commissions.

Safety & Regulation

Vanilla options are a highly regulated instrument versus some of the other binary options alternatives listed in this guide. When trading with a trusted broker, investors can trade this binary options alternative with confidence.

Strategies

Investors can choose to write options contracts or purchase them from an exchange as speculative assets or for hedging existing trades. Options spreads can be used to profit from various trading metrics such as volatility or direction.

Traders can also sell covered calls to lock in smaller but safer profits consistently– a strategy available with binary options.

Vanilla Options Brokers

  1. Forex.com boast a global reputation. Regulated in the UK, EU, US and Canada they offer a huge range of markets, not just forex, and offer tight spreads on a cutting edge platform.

    Instruments
    CFD, Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
    Platforms
    MT4
    Min. Deposit
    $100
    Min. Trade
    $1
    Leverage
    1:200
  2. NinjaTrader offer investors futures and forex trading. Use auto-trade algorithmic strategies and configure your own platform while trading with the lowest costs.

    Instruments
    Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    NFA, CFTC
    Platforms
    Own
    Min. Deposit
    $50
    Min. Trade
    Varies by asset
    Leverage
    -
  3. The leading US trading Exchange. Nadex offer genuine exchange trading to global clients on Binary Options. Fully regulated by the CFTC.

    Instruments
    Binary Options, Knock Outs™, Call Spreads
    Regulator
    CFTC
    Platforms
    Own
    Min. Deposit
    $250
    Min. Trade
    $1
    Leverage
    -
  4. IG-US offer spread betting, CFD and Forex trading across a range of markets. They are FCA regulated, boast a great trading app and have over 47 year track record of excellence.

    Forex trading involves risk. Losses can exceed deposits

    Instruments
    Forex, ETFs, CFDs, indices, shares, commodities, cryptocurrencies, options, futures, spread betting
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
    Platforms
    MT4
    Min. Deposit
    £250
    Min. Trade
    0.1 lots
    Leverage
    1:30
  5. Zacks Trade is a US based brokerage, built for the active trader. Trade stocks, ETFs, bonds, mutual funds and more on a proprietary trading platform.

    Instruments
    Stocks, Crypto, Options
    Regulator
    FINRA
    Platforms
    Own
    Min. Deposit
    $2500
    Min. Trade
    $3
    Leverage
    -
  6. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    Instruments
    CFD, Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    SEC, FCA, IIROC, SFC
    Platforms
    AlgoTrader, OmniTrader
    Min. Deposit
    $10000
    Min. Trade
    $100
    Leverage
    1:50
  7. One of the largest discount brokers in the US, with a fixed trading commission and access to a large array of trading products and securities.

    Instruments
    Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    SEC, FINRA, CFTC
    Platforms
    Own
    Min. Deposit
    $0
    Min. Trade
    None
    Leverage
    -
  8. Webull offers a popular online stock trading app with low fees and generous bonuses.

    Instruments
    Stocks, ETFs, options, cryptos, forex, ADRs, fractional shares, OTCs
    Regulator
    SEC, FINRA
    Platforms
    Own
    Min. Deposit
    $0
    Min. Trade
    $5
    Leverage
    -

Binary Options Alternative 3: Futures

Futures are one of the most unique alternatives to binary options and forex trading. These are agreements to buy or sell an asset for a set price at a specific time. These derivatives were primarily used within the commodities industry as a hedge against future price fluctuations but are now a well-used financial instrument for many markets.

This type of trading involves the delivery of physical assets at expiry. It is exchange-traded rather than sold over-the-counter (OTC). Futures contracts are primarily associated with US markets, but EU and UK investors can still get involved.

Markets

While futures were first used on commodity markets such as cattle, wheat and orange juice, this instrument has expanded to cover assets like equities and cryptocurrencies.

Complexity

Futures are a fairly complex product compared to binary options. Though, with a thorough education, these contracts offer far greater strategic potential and can form a vital element of an expert investor’s trading arsenal.

Profit & Loss Potential

Futures contracts typically involve 1,000 units of a specific asset, and most futures brokers offer the opportunity to trade on margin for enhanced trading leverage. This gives investors the chance to make significant trading profits or losses.

It is with mentioning that futures can also be utilized to hedge against spot instruments to reduce risk.

Fees & Commissions

Fees for futures contracts can be higher than other instruments and binary options alternatives. However, traders will often receive a fee discount for high-volume trading or creating high-capital accounts.

Holding positions overnight will also come with swap fees, so this binary options alternative is best utilized for day trading or short-term swing trading.

Safety & Regulation

As with many binary options alternatives for US citizens, American futures contracts are regulated by the CTFC. Combined with the exchange-traded nature of futures contracts, this instrument is one of the safest to trade vs binary options.

Strategies

Regarding strategy, most traders will not hold futures contracts until expiry but look to resell their positions before the contract is automatically closed out. This is to avoid having to take delivery of the physical asset, such as barrels of oil.

Futures pricing can swing dramatically based on news and events, so acting quickly to any upcoming market changes will pay dividends with this instrument.

Futures Brokers

  1. Forex.com boast a global reputation. Regulated in the UK, EU, US and Canada they offer a huge range of markets, not just forex, and offer tight spreads on a cutting edge platform.

    Instruments
    CFD, Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
    Platforms
    MT4
    Min. Deposit
    $100
    Min. Trade
    $1
    Leverage
    1:200
  2. NinjaTrader offer investors futures and forex trading. Use auto-trade algorithmic strategies and configure your own platform while trading with the lowest costs.

    Instruments
    Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    NFA, CFTC
    Platforms
    Own
    Min. Deposit
    $50
    Min. Trade
    Varies by asset
    Leverage
    -
  3. The leading US trading Exchange. Nadex offer genuine exchange trading to global clients on Binary Options. Fully regulated by the CFTC.

    Instruments
    Binary Options, Knock Outs™, Call Spreads
    Regulator
    CFTC
    Platforms
    Own
    Min. Deposit
    $250
    Min. Trade
    $1
    Leverage
    -
  4. IG-US offer spread betting, CFD and Forex trading across a range of markets. They are FCA regulated, boast a great trading app and have over 47 year track record of excellence.

    Forex trading involves risk. Losses can exceed deposits

    Instruments
    Forex, ETFs, CFDs, indices, shares, commodities, cryptocurrencies, options, futures, spread betting
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
    Platforms
    MT4
    Min. Deposit
    £250
    Min. Trade
    0.1 lots
    Leverage
    1:30
  5. Kraken is a top-rated cryptocurrency trading exchange offering the largest tokens and altcoins by market cap.

    Instruments
    Cryptos
    Regulator
    FCA, FinCEN, FINTRAC, AUSTRAC, FSA
    Platforms
    AlgoTrader
    Min. Deposit
    $10
    Min. Trade
    Varies upon the crypto traded
    Leverage
    -
  6. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    Instruments
    CFD, Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    SEC, FCA, IIROC, SFC
    Platforms
    AlgoTrader, OmniTrader
    Min. Deposit
    $10000
    Min. Trade
    $100
    Leverage
    1:50
  7. One of the largest discount brokers in the US, with a fixed trading commission and access to a large array of trading products and securities.

    Instruments
    Forex, Stocks, Crypto, Futures, Options, Commodities
    Regulator
    SEC, FINRA, CFTC
    Platforms
    Own
    Min. Deposit
    $0
    Min. Trade
    None
    Leverage
    -
  8. InstaForex is a CFD broker providing access to forex, stocks, cryptocurrencies, commodities, energies, indices, and more. With competitive fees and a huge range of available assets, the brand offers safe and reliable trading.

    Instruments
    Forex, shares, indices, metals, oil and gas, futures, cryptos, binary options
    Regulator
    BVI FSC
    Platforms
    MT4, MT5
    Min. Deposit
    $/€1
    Min. Trade
    0.01 Lots
    Leverage
    1:1000

Binary Options Alternative 4: Spread Betting

One of the top instruments in our binary options alternatives examples is spread betting. Spread betting works similarly to CFD trading but comes with tax advantages in some regions as it is classed as gambling rather than trading.

Markets

As there are fewer spread betting brokers than CFD providers, there will be a smaller range of assets to choose from. However, spread betting speculation is still available for forex, indices, commodities, stocks and crypto markets.

Complexity

Spread betting is a reasonably straightforward instrument. However, expert traders can add complexity using order tools such as stop losses, take profit levels and automated trading bots.

Profit & Loss Potential

As with CFDs, traders can access significant leverage to multiply potential profits and losses when spread betting.

However, these levels are still likely lower than the high leverage available through international CFD brokers. This is because most spread betting providers are EU or UK-based and therefore have to comply with ESMA regulations limiting maximum margin.

Fees & Commissions

Fees and commissions are low with this alternative to binary options but will vary from broker to broker.

Safety & Regulation

Spread betting tends to be safer than CFDs and binary options due to the EU regulation of most brokers. In addition, as a more obscure field, fewer fraudulent providers are out there.

Strategies

As with CFDs, the range of strategies available is relatively limited. This binary options alternative is best suited to strong, short-term directional price movements, with significant profits available for successful speculation.

Spread Betting Brokers

  1. IG offers spread betting in the UK across a range of markets. The firm is FCA-regulated and traders have access to a multitude of market analysis tools.

    Forex trading involves risk. Losses can exceed deposits

    Instruments
    Forex, ETFs, CFDs, indices, shares, commodities, cryptocurrencies, options, futures, spread betting
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
    Platforms
    MT4
    Min. Deposit
    £250
    Min. Trade
    0.1 lots
    Leverage
    1:30

Binary Options Alternative 5: Stock Trading

Stock trading is the most simple and common form of trading and one of the most popular alternatives to binary options. Investors can purchase single stocks, ETFs or mutual funds containing hand-picked segments of specific sectors or global markets.

Markets

The best stock trading brokers will offer thousands of stocks from many international regions, with equities from the USA, EU and UK reasonably standard for all. Some brokers will support mutual fund investing, while others may focus solely on single stocks and ETFs for day trading.

Complexity

Suitable for beginners up to experts, stock trading offers opportunities for day trading, swing trading, long-term investing or earning profit from dividends. This can be as simple as buying a stock and holding it for an extended period to as complex as setting up an automated dividend portfolio targeting the biggest yielding companies in a region.

Profit & Loss Potential

While margin trading is possible through some brokers, most stock trading is done on cash accounts. As a result, stock trading does not typically offer as much profit potential as derivative assets such as binary options, CFDs or vanilla options.

Fees & Commissions

Of all the binary options alternatives available, stock trading has the most variance in its fees. Some brokers allow free investing, while others charge commissions per stock or a dealing fee per trade.

In addition, some more traditional brokers, specifically international companies, will charge account fees. To offset these, many regions, including the USA and UK, offer tax-advantaged stock accounts that investors can use for retirement or general savings.

Safety & Regulation

There is no shortage of highly regulated brokers when making a stock trading investment. Regional regulators also protect the equities themselves for additional peace of mind. This is a key benefit over some of the other binary options alternatives explored below, including crypto exchanges.

Strategies

One of the greatest strengths of stock investing is the flexibility afforded for trading. Traders can hold positions for an unrestricted period, going long or short on an asset.

With this binary options alternative, investors can target high dividend-yield stocks to be paid an income from holding equities. Or, traders can set up bots to buy and sell based on preset parameters. Investors can even hedge spot stocks with futures positions to reduce risk.

Stock Brokers

  1. Forex.com offer access to over 1,200 US, EU and UK stocks, with spreads of just 1 point. See why Forex.com are about more than just forex...

    Demo Account
    Yes
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
    Platforms
    MT4
    Min. Deposit
    $100
    Automation
    Yes
    Bonus
    No
  2. Speculate on 8 global indices via binary options contracts.

    Demo Account
    Yes
    Regulator
    CFTC
    Platforms
    Own
    Min. Deposit
    $250
    Automation
    Yes
    Bonus
    None
  3. Take positions on large public companies and household names.

    Demo Account
    Yes
    Regulator
    NFA, CFTC
    Platforms
    Own
    Min. Deposit
    $50
    Automation
    Yes
    Bonus
    None
  4. eToro offer access to over 3000 stocks and shares from all over Europe, the US and beyond.

    79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

    Demo Account
    Yes
    Regulator
    FCA, CySEC, ASIC, FSA
    Platforms
    Own
    Min. Deposit
    $10
    Automation
    Yes
    Bonus
    None
  5. LSE-listed IG Group offers stock trading via CFDs, spread betting (in the UK) and digital 100s. Margin requirements vary.

    Forex trading involves risk. Losses can exceed deposits

    Demo Account
    Yes
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
    Platforms
    MT4
    Min. Deposit
    £250
    Automation
    Yes
    Bonus
    None
  6. Moomoo offers online US and Hong Kong stocks, and China-A shares trading across options, ETFs, ADRs, OTC, U.S, plus IPOs on a proprietary trading platform.

    Demo Account
    Yes
    Regulator
    SEC, FINCEN, MAS
    Platforms
    Own
    Min. Deposit
    $0
    Automation
    No
    Bonus
    Get up to 15 free stocks worth up to $2000
  7. Trade digital options on 10+ major indices, including the FSTE 100, plus a handful of OTC stocks.

    Demo Account
    Yes
    Regulator
    -
    Platforms
    Own
    Min. Deposit
    $10
    Automation
    Yes
    Bonus
    30% deposit bonus
  8. Webull offers trading on 2,000 US stocks and shares via a powerful mobile app.

    Demo Account
    Yes
    Regulator
    SEC, FINRA
    Platforms
    Own
    Min. Deposit
    $0
    Automation
    No
    Bonus
    Six free stocks
  9. Trade over 6,000 stocks and shares on the NYSE, NASDAQ and more.

    Demo Account
    Yes
    Regulator
    FINRA, SEC
    Platforms
    Own
    Min. Deposit
    $100 ($500 for IRA)
    Automation
    Yes
    Bonus
    M1 Finance Plus free for 3 months on new accounts
  10. Trade stocks and shares on major companies in US markets and speculate on some of the world's largest indices.

    Demo Account
    Yes
    Regulator
    FINRA
    Platforms
    Own
    Min. Deposit
    $2500
    Automation
    Yes
    Bonus
    None
  11. Trade shares in 170 US companies

    Demo Account
    Yes
    Regulator
    HCMC (Greece), FSCA (South Africa)
    Platforms
    MT4, MT5
    Min. Deposit
    $10
    Automation
    Yes
    Bonus
    100% Deposit Bonus available for Global clients
  12. Trade thousands of stocks and shares with low fees.

    Demo Account
    No
    Regulator
    FINRA, SEC
    Platforms
    Own
    Min. Deposit
    $0
    Automation
    No
    Bonus
    None
  13. Speculate on large US stocks including Tesla, Amazon, Alibaba and Apple

    Demo Account
    Yes
    Regulator
    FCA, FinCEN
    Platforms
    Own
    Min. Deposit
    $0
    Automation
    Yes
    Bonus
    None
  14. Trade 40+ stock CFDs including big names like IBM and American Express.

    Demo Account
    Yes
    Regulator
    SVGFSA
    Platforms
    MT4, MT5
    Min. Deposit
    $1
    Automation
    Yes
    Bonus
    100% Deposit Bonus
  15. Pocket Option is a global binary options broker with a sleek proprietary trading platform and competitive range of assets.

    Demo Account
    Yes
    Regulator
    IFMRRC
    Platforms
    MT5
    Min. Deposit
    $50
    Automation
    Yes
    Bonus
    50% deposit bonus
  16. Interactive Brokers provide access to every major trading exchange in the world. Their range cannot be beaten.

    Demo Account
    Yes
    Regulator
    SEC, FCA, IIROC, SFC
    Platforms
    AlgoTrader, OmniTrader
    Min. Deposit
    $10000
    Automation
    No
    Bonus
    None
  17. Trade major shares plus US synthetic stocks and well-known indices

    Demo Account
    Yes
    Regulator
    BVI FSC
    Platforms
    MT4, MT5
    Min. Deposit
    $/€1
    Automation
    Yes
    Bonus
    30% - 100% Welcome Bonus
  18. TD Ameritrade offers trading for virtually any domestic stocks, international stocks via ADR or IPOs.

    Demo Account
    Yes
    Regulator
    SEC, FINRA, CFTC
    Platforms
    Own
    Min. Deposit
    $0
    Automation
    Yes
    Bonus
    None

Binary Options Alternative 6: Cryptocurrency

The newest market on this list, cryptocurrency products can be traded as derivatives through binary options, CFDs or spread betting. However, the asset class has far more utility to investors.

Markets

There are more and more crypto tokens being created at all times, with thousands of coins and projects in existence. While not all of these are legitimate, more cautious investors can stick to more well-known coins such as Bitcoin and Ethereum for greater peace of mind.

Complexity

Similarly to stock investing, cryptocurrency trading can be as simple or complex as a trader desires. Investors can buy and hold crypto tokens, stake them for interest or utilize bots on sites such as Pionex for round-the-clock automated trading.

Profit & Loss Potential

The crypto markets are notoriously volatile and have seen some meteoric price rises and falls in their brief history. Investors should be prepared for these conditions or even a complete collapse of a coin like Terra in 2022.

Fees & Commissions

Many exchanges offer very low, competitive fees on this binary options alternative. These are usually displayed in the form of maker and taker fees, often shown as a percentage.

Safety & Regulation

Crypto is almost entirely unregulated and scams are rife within the broker space and the coins themselves. As a result, more cautious investors may wish to avoid this binary options alternative or track selected crypto markets using a more secure ETF.

Strategies

Traders can buy and hold tokens long-term or take advantage of the volatile crypto markets to day trade.

Advanced strategies such as spot/futures arbitrage are available for major tokens such as BTC and ETH and can yield solid and low-risk returns.

Similarly to dividend investing, traders can stake crypto tokens for a fixed reward, with some providers offering upwards of 10% annual returns for this strategy.

Crypto Brokers

  1. Trade the major cryptos against USD, EUR, GBP and AUD. All traded with tight spreads. No virtual wallet required, just a trading account. Note, cryptos are not available in the US or Canada.

    Forex.com Crypto Trading

    Forex.com offers trading on 5 crypto coins: BCH, BTC, ETH, LTC, XRP

    Crypto Spread
    BTC 1.4%, ETH 2%
    Crypto Lending
    No
    Platforms
    MT4
    Crypto Staking
    No
    Minimum Deposit
    $100
    Regulator
    CySEC, IIROC, NFA, CFTC, FCA, CIMA
  2. Trade micro Bitcoin with low fees

    NinjaTrader Crypto Trading

    NinjaTrader offers trading on 1 crypto coin: BTC

    Crypto Spread
    Floating
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $50
    Regulator
    NFA, CFTC
  3. Uphold offers trading on more than 100 crypto assets including via crypto-only pairs and crypto-fiat cross pairs.

    Uphold Crypto Trading

    Uphold offers trading on at least 96 crypto coins, for example: AAVE, ADA, ALCX, ALGO, API3, ATOM, AUDIO, AVAX, AXS, BAL, BAT, BCH, BTC, BTCO, CAKE, CHR, DAO, DYDX, ETH, GHST, GLMR, GODS, INH, LSK, NMR, REQ, ROOK, TRB, XRP, XYO

    Crypto Spread
    0.5% to 1% average
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    Yes
    Minimum Deposit
    $0
    Regulator
    FCA, FinCEN
  4. Trade four major cryptocurrencies paired with USD

    IG Group Crypto Trading

    IG Group offers trading on 4 crypto coins: BCH, BTC, ETH, LTC

    Forex trading involves risk. Losses can exceed deposits

    Crypto Spread
    Variable
    Crypto Lending
    No
    Platforms
    MT4
    Crypto Staking
    No
    Minimum Deposit
    £250
    Regulator
    FCA, ASIC, MAS, FSCA, JFSA, FMA, CFTC, NFA, BMA, DFSA, FINMA, BaFin
  5. Coinmama aim to make entering the crypto market as easy as possible, offering big tokens like Bitcoin and Ethereum

    Coinmama Crypto Trading

    Coinmama offers trading on 9 crypto coins: BCH, BTC, DOGE, ETH, LINK, LTC, UNI, XRP, XTZ

    Crypto Spread
    From 2.93% to 3.90%. Express fees of 0-5.00% also apply.
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $30
    Regulator
    FinCEN, FINTRAC
  6. Pionex is an automated crypto trading platform with built-in bots and a wide range of tokens.

    Pionex Crypto Trading

    Pionex offers trading on at least 229 crypto coins, for example: AAVE, ADA, ALICE, AXS, BAKE, BCH, BTC, BTT, BUSD, CAKE, DOGE, DOT, EOS, ETC, ETH, FIL, HT, ICP, JST, LINK, LTC, NFT, PUNDIX, SNX, SUN, TFUEL, TRX, UNI, WIN, XRP

    Crypto Spread
    Market
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    FinCEN
  7. Build custom crypto portfolios and select from the broker's expert pies.

    M1 Finance Crypto Trading

    M1 Finance offers trading on 8 crypto coins: ADA, ALDO, ATOM, AVE, BAT, BTC, ETH, LINK

    Crypto Spread
    Variable
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $100 ($500 for IRA)
    Regulator
    FINRA, SEC
  8. Paxful offers buying and selling of the world's leading cryptocurrencies.

    Paxful Crypto Trading

    Paxful offers trading on 3 crypto coins: BTC, ETH, USDT

    Crypto Spread
    Rates set by vendors
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    From 0.005 BTC
    Regulator
    -
  9. Invest in cryptocurrency via OTC Trusts, ETFs, mutual funds and Bitcoin futures

    TD Ameritrade Crypto Trading

    TD Ameritrade offers trading on 4 crypto coins: BTC, ETH, MBT, MET

    Crypto Spread
    Commission fees apply
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    SEC, FINRA, CFTC
  10. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    Interactive Brokers Crypto Trading

    Interactive Brokers offers trading on 4 crypto coins: BTC, ETH, LTC, XRP

    Crypto Spread
    -
    Crypto Lending
    No
    Platforms
    AlgoTrader, OmniTrader
    Crypto Staking
    No
    Minimum Deposit
    $10000
    Regulator
    SEC, FCA, IIROC, SFC
  11. Trade popular cryptocurrency coins with low fees.

    Crypto Spread
    0.18% fee per trade
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $2500
    Regulator
    FINRA
  12. Trade cryptocurrencies against the US Dollar

    AAAFx Crypto Trading

    AAAFx offers trading on 6 crypto coins: BCH, BTC, ETH, LTC, USDT, XRP

    Crypto Spread
    From 1.3 pips
    Crypto Lending
    No
    Platforms
    MT4, MT5
    Crypto Staking
    No
    Minimum Deposit
    $10
    Regulator
    HCMC (Greece), FSCA (South Africa)
  13. Trade over 65 cryptocurrencies including Bitcoin

    Kraken Crypto Trading

    Kraken offers trading on at least 57 crypto coins, for example: AAVE, ADA, ALGO, ANT, ATOM, BAL, BAT, BCH, COMP, CRV, DAI, DASH, EOS, ETC, ETH, EWT, FIL, FLOW, GNO, ICX, KAVA, KEEP, KNC, KSM, LINK, MANA, REP, REPV2, XBT, XDG

    Crypto Spread
    0-0.26% average
    Crypto Lending
    No
    Platforms
    AlgoTrader
    Crypto Staking
    Yes
    Minimum Deposit
    $10
    Regulator
    FCA, FinCEN, FINTRAC, AUSTRAC, FSA
  14. Trade a handful of the top cryptos at Quotex.

    Quotex Crypto Trading

    Quotex offers trading on 4 crypto coins: BTC, ETH, LTC, XRP

    Crypto Spread
    N/A
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $10
    Regulator
    -
  15. Webull offers trading on popular cryptos such as Bitcoin against the US Dollar.

    Webull Crypto Trading

    Webull offers trading on at least 43 crypto coins, for example: ADA DASH, ALGO, ATOM, AVAX, BAT, BCH, BTC, CRV, DOGE, EOS, ETC, ETH, FTM, GRT, LINK, LRC, LTC, LUNA, MANA, MATIC, REM, SHIB, SISHI, SOL, TRX, UNI, XLM, XMR, XTZ, ZEC

    Crypto Spread
    Floating
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    SEC, FINRA
  16. Trade over 100 crypto pairs on an extensive list of popular and emerging digital currencies.

    Gemini Crypto Trading

    Gemini offers trading on at least 56 crypto coins, for example: AAV, ADA, ATOM, BAT, BCH, BTC, COMP, DAI, DOGE, DOT, ENJ, EOS, ETH, FIL, GRT, LINK, LTC, MANA, MKR, SNX, SOL, UMA, UNI, WBTC, XLM, XRP, XTZ, YFI, ZEC, ZRX

    Crypto Spread
    Transaction fee from $0.99
    Crypto Lending
    Yes
    Platforms
    AlgoTrader
    Crypto Staking
    Yes
    Minimum Deposit
    $0
    Regulator
    NYDFS, MAS, FCA
  17. Nexo supports cryptocurrency trading through its exchange platform on 35+ in-demand tokens.

    Nexo Crypto Trading

    Nexo offers trading on at least 39 crypto coins, for example: ADA, APE, ATOM, AVAX, AXS, BCH, BNB, BTC, DOGE, DOT, EOS, ETH, FTM, KSM, LINK, LTC, MANA, MATIC, NEAR, NEXO, PAXG, RUNE, SAND, SOL, TRX, UNI, USDC, USDT, XLM, XRP

    Crypto Spread
    N/A
    Crypto Lending
    Yes
    Platforms
    Own
    Crypto Staking
    Yes
    Minimum Deposit
    $10
    Regulator
    ASIC, FCEN
  18. Make crypto trades against fiat currencies with a single tap from $1.

    Revolut Crypto Trading

    Revolut offers trading on at least 53 crypto coins, for example: 1INCH, AAVE, ADA, ALGO, AMP, ANKR, ATOM, BAND, BAT, BCH, BNT, BTC, CELO, CHL, COMP, CRV, CTSI, DOGE, ENJ, EOS, ETH, FIL, ICP, KEEP, KNC, LINK, LTC, MANA, RLC, ZRX

    Crypto Spread
    2.5% commission for standard profiles
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    No
    Minimum Deposit
    $0
    Regulator
    FINRA, SEC
  19. Trade on 10 cryptos paired with the USD and EUR. Crypto only pairs are also available.

    World Forex Crypto Trading

    World Forex offers trading on 10 crypto coins: BCH, BTC, DSH, EOS, ETH, LTC, NEO, XMR, XRP, ZEC

    Crypto Spread
    -
    Crypto Lending
    No
    Platforms
    MT4, MT5
    Crypto Staking
    No
    Minimum Deposit
    $1
    Regulator
    SVGFSA
  20. Pocket Option supports five cryptocurrency options assets spanning major tokens and cross pairs.

    Pocket Option Crypto Trading

    Pocket Option offers trading on 4 crypto coins: BTC, EOS, ETH, LTC

    Crypto Spread
    N/A
    Crypto Lending
    No
    Platforms
    MT5
    Crypto Staking
    No
    Minimum Deposit
    $50
    Regulator
    IFMRRC
  21. Buy and sell an extensive list of leading and emerging crypto coins at Binance.

    Binance Crypto Trading

    Binance offers trading on at least 56 crypto coins, for example: ADA, ALGO, BCH, BNB, BTC, BUSD, DAI, DOGE, EGLD, ENJ, EOS, ETH, HBAR, HNT, IOTA, LINK, LTC, MANA, MATIC, NANO, NEO, ONE, QTUM, RVN, SOL, USDT, VET, VTHO, XLM, ZIL

    Crypto Spread
    Variable fees with account tiers
    Crypto Lending
    Yes
    Platforms
    AlgoTrader
    Crypto Staking
    Yes
    Minimum Deposit
    $0
    Regulator
    FCA
  22. eToro leads the way in cryptocurrency trading. The lowest spreads (from 0.75% for BTC), their own wallet service and the largest number of cryptos to trade in the market. Cryptoasset investing is highly volatile and unregulated in the UK and some EU countries. No consumer protection. Tax on profits may apply..

    eToro Crypto Trading

    eToro offers trading on 15 crypto coins: ADA, BCH, BNB, BTC, DASH, EOS, ETC, ETH, LTC, MIOTA, NEO, VET, XLM, XRP, ZEC

    79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

    Crypto Spread
    BTC <1%, ETH 2%
    Crypto Lending
    No
    Platforms
    Own
    Crypto Staking
    Yes
    Minimum Deposit
    $10
    Regulator
    FCA, CySEC, ASIC, FSA
  23. InstaForex offer crypto CFD trading on leading tokens with very low fees.

    InstaForex Crypto Trading

    InstaForex offers trading on 6 crypto coins: BCH, BTC, ETH, LTC, XRP, and 14 more

    Crypto Spread
    From 0%
    Crypto Lending
    No
    Platforms
    MT4, MT5
    Crypto Staking
    No
    Minimum Deposit
    $/€1
    Regulator
    BVI FSC

Binary Options Alternatives: Further Considerations

Now you have discovered some of the popular alternatives to binary options, here is some additional information to consider to help you get started trading with one of these instruments.

Brokerages

When looking at binary options alternatives, choosing a brokerage is an essential step for safe and low-cost trading. Here are some general qualities to look out for to find the best brokers:

  • Low Fees – A low-commission broker will help you keep more of your trading profits.
  • Secure – Strong regulation and login protection measures such as two-factor authentication are highly preferable.
  • Demo Account – If you are transitioning from binary options to an alternative instrument, you will likely need some practice. Our experts recommend choosing a broker with a free demo account.
  • Customer Support – When looking to trade alternatives to binary options, look for a broker with a helpful and responsive customer service team. Reaching out via live chat to test this service before signing up is worth it.
  • Trading Platforms – Serious investors need a capable and reliable trading platform available on Windows or Mac. We found that industry-standard software such as MT4 MT5, and TradingView are well suited to most traders with rich historical data and technical indicators. Those who want to trade on-the-go should also ensure their broker has an app to download for iOS or Android.

Education

The most straightforward binary options strategy is applicable for many of the alternatives in this article, which is going long or short on an asset. However, a more thorough education is required to gain an edge when using instruments such as standard options, stock trading and futures.

There are many trading courses, videos and guides on how to get started trading each of these binary options alternatives. We found that trading using a demo account is invaluable for traders new to a specific market or instrument.

Regional Considerations

While all these instruments trade on global markets, some binary options alternatives have regional restrictions. For example, CFDs are banned for Canadian and US residents and crypto derivatives are restricted for investors in the UK.

Additionally, binary options are classed as gambling in some jurisdictions, such as the UK. Therefore, they have tax advantages over other forms of trading. The rules on binary options and their alternatives will be different for other regions too, such as Australia, Korea, India, Germany, Canada and for US citizens.

Ensure you understand your local trading tax rules before getting started.

Final Word On Binary Options Alternatives

Investors that either cannot or do not want to trade using binary options are spoilt for choice in their alternatives. Trading methods such as CFDs and spread betting offer similar types of speculation but with key differences such as uncapped losses and gains. Traders can also draw upon instruments such as futures and vanilla options for more advanced investing in a more secure and regulated space.

FAQ

Which Alternatives To Binary Options Suit Day Trading?

Some of the most popular alternatives to binary options for day trading are stock trading, CFDs and spread betting. These formats allow investors to capitalize on intra-day price movements, often with high leverage.

Which Binary Options Alternatives Are Halal?

Whether an instrument is halal or haram can depend on the specific trading strategy or the account used. For example, Muslim CFD traders can open special Islamic accounts to comply with their religious principles, while crypto staking is more of a grey area.

Are Alternatives To Binary Options Good Or Bad?

There are several benefits and disadvantages to alternative trading methods to binary options. Almost all binary options alternatives benefit from greater regulatory oversight, security, and payout potential. However, binary options are simple and have capped losses to prevent investors from losing more than they stake.

Are Binary Options The Same As Options?

Binary options are less complex than traditional options but offer lower potential rewards for a successful trade. When comparing binary options vs regular options, these methods suit different market conditions and trader profiles.

Do Binary Options Alternatives Come With Demo Accounts?

Demo accounts are key for traders wanting to learn new markets or instruments. They are commonly offered to investors when trading CFDs, stocks or binary options. However, they may be harder to come by for alternatives such as futures and cryptos.