Before the advent of electronic platforms, traders had to go through dealers who bought or sold their assets on the trading floor of the exchange. Nowadays, technological advances have pushed the boundaries to allow anyone with a PC or hand held device to plug in to a binary options trading software to bet on assets on their accounts.
Binary options platforms are provided by brokers to their clients so that they can gain access to the market to buy and sell binary options contracts. There are two versions of platforms if defined from the standpoint of the devices used in the trading process:
- Web-based versions
- Mobile versions
For each version of the binary options software, there are two types used, based on the process of development. These are:
Web based platforms
The web-based software are based on the JAVA software, and can be accessed from the broker’s website. They do not require any files to be downloaded for them to work (except of course the JAVA software). The web-based versions of the binary options trading software can be of the white-label variety or the proprietary variety.
Why do we have these different varieties of trading suites? The answer lies in the cost of research and development that goes into the production of a trading suite’s front-end and back-end solutions. For many brokers, the financial implications of creating their own software is prohibitive and that is why these brokers opt to use software solutions that have been developed by third-party software companies, who now charge the brokers a fraction of what they would have spent developing their own software. This gives brokers a customized solution (the white-label arrangement) at lesser cost. This is not different from what obtains in forex where MetaQuotes Inc customizes its MetaTrader4 forex trading platform for market makers, and traders with forex ECN accounts use ECN software like Currenex Classic.
The following are the white label platforms in use today:
- SpotOption: Used by iOption, CitiTrader, etc.
- Tech Financial Ltd: Used by 24Option, OptionFair.
- Tradologic: Used by Opteck.
Some brokers prefer to develop their own software. This gives them the freedom to provide their clients with unique binary contracts and expiry times. Examples of brokers who have adopted this model are BOM, NADEX and AnyOption. Some market players also love to open accounts with these brokers because the trade variations allow them to profit better.
The advent of mobile phones with all manner of enhanced capabilities has created the need to develop binary software that traders can take with them wherever they go. It is possible to open accounts, deposit and withdraw. Two types are used in the market today.
- Smartphone apps: These are binary software that have been created as applications for smartphones. They can be downloaded from the relevant app stores of from the broker’s binary trading website.
- Mobile versions of web-based platforms: These are simply web-based versions which have been modified for use on mobile phones without affecting the display and performance of the software.
As at 2013, the use of mobile trading suites is increasing, and usage is expected to increase as more people embrace mobile technology and all its benefits.