Nadex Review

Nadex is the leading U.S. platform for trading binary options, knockouts, and call spreads. They assert to be the premier exchange in this field and their security measures meet the regulatory standards, ensuring a safe work environment for traders. Nadex is a regulated trading platform for binary options – controlled and monitored by the Commodities Futures Trading Commission. This ensures that it is shielded from scams prevalent in such markets. Nadex provides a safe environment for US clients to make derivative trades as the commissions are reasonable and the desktop platform is user-friendly. This type of investment does not include stocks, bonds or ETFs and only offers derivatives. Nadex can be a great choice if you understand the risks that come with trading derivatives. Knowledge of these potential dangers is essential before investing in Nadex. It is advisable to stick with traditional brokers if you lack the knowledge and expertise required to trade complicated financial instruments. Trying to carry out trades without having adequate information can result in significant losses.

Nadex quick overview

Nadex is a financial exchange company based in Chicago and it has been operating for over a decade. The name stands for North American Derivatives Exchange. Nadex is not a typical broker but instead, it acts as an exchange to match buyers and sellers contracts with each other. Nadex is a different kind of trading platform than most as it acts as a marketplace rather than an intermediary. This allows customers and businesses to benefit by getting the best possible parameters for their trades.

Why choose Nadex over others?

• Large variety of tradable market: Nadex offers a great platform to access different markets, but they don’t offer any direct stock, ETFs or other securities trading. However, you can trade options contracts in order to gain exposure to these markets. With binary options, you can trade and invest in stocks, commodities, currencies and macroeconomic events. This type of investing provides an easy way to speculate on financial markets and manage risk.
• Trustworthy counterparties: Binary options often have a negative reputation due to the lack of regulation in this market. This brings with it many potential risks as scam artists attempt to take advantage of naive traders. As such, caution is often advised when trading binary options. The Commodity Futures Trading Commission (CFTC) puts Nadex under its strict scrutiny, so customers can be sure that they will have a fair and honest trading experience.
• High quality educational tools: The learning center offers a wealth of educational materials, making it an invaluable resource for those trading derivatives that are not commonly known in the trading community. Nadex offer a wide array of resources such as glossaries, tutorials, webinars and blog posts covering different topics – from the basics to market insights and individual trading strategies.

Brokerage Quick Summary

Nadex Fees and Commissions

Nadex’s fee schedule is straightforward and consists of a single charge of $1 per trade you make, whether it is opening or closing a position. When exercising a contract that is “in the money”, you will be charged a fee of $1, while contracts that are “out of the money” do not incur any costs. In addition, transactions made with the automated clearinghouse (ACH) do not have any associated cost.

Use Nadex

Even if you’re a novice without extensive experience in derivatives markets, you can still open a Nadex Account and start trading! It’s imperative to have a clear understanding of these tools and how they operate in order to identify your level of risk tolerance. Binary options trading is an either/or system. You either win or lose the trade; there’s no in-between. Nadex is an excellent platform for novice traders, as it provides lots of assistance in producing successful trades. The platform offers a comprehensive range of support to ensure that new clients understand the process and get off to a good start.

• One platform: Experienced traders might not be too happy with this but Nadex runs solely on a web-based platform and there is no separate desktop or mobile app. This level playing field is a plus point for novice traders as they don’t have to worry about people on the other side of their contracts having any technological edge over them.
• Signing up for a new account is easy: Signing up for Nadex doesn’t take more than a few minutes with its simple 5-step process. Compared to other online forms or web portals, this method is fast and hassle-free.
• Demo account and tutorials: It is common to experience a period of familiarization when trading difficult products on an unfamiliar platform, known as the learning curve. Nadex understands the hesitation some traders may have when starting out and offers a demo account for those not ready to commit. This helps clients get familiar with the platform before going ahead with trading. The Learning Center offers a wide range of tutorials to help you further understand specific topics or concepts.

Nadex Education

Nadex stands out by offering resources to help new traders learn the ins and outs of derivative markets. They offer tutorials, demos, articles, and webinars all designed to help traders understand these complex markets better.

The Learning Center provides detailed guidance on getting started with their platform, opening an account and forming strategies for trading. It is a great source of helpful information for any new investors. Through the glossary, you can understand the meanings of unfamiliar words in a simpler way. The blog can also be a great resource for staying up to date with market news, learning trading techniques and getting platform updates.

Webinars are incredibly valuable as they are often offered at no cost, yet offer a great deal of detailed information on sophisticated trading strategies. The topics covered range from basics to current market analysis and potential opportunities.

Customer Support at Nadex

Despite the lack of a dedicated contact number on the main Contact page, existing clients can easily access customer service by phone through their accounts. If you are interested in finding out more about Nadex, you can reach out to the Nadex team via email (customerservice@nadex.com) or through our Contact page, where there is a chatbot available to answer any questions you may have.

Nadex Offerings

Nadex offers three different types of trading instruments such as binary options, knockouts. Each offer different features that are explained in brief below:

Binary options: Binary Options are financial contracts with two possible outcomes – win or loss. These contracts usually involve a question such as “Will silver’s price rise to $28 by December 2020?” Upon expiry, you can either earn $100 per share or receive nothing if the contract is held. Binary options are derivatives that have a fixed payout based on a yes/no market proposition – you either get it right or wrong.

Call Spreads: Call spreads are one of the many option strategies available, and just like other strategies, you will need to establish a maximum or minimum limit when you begin to execute a trade. The good news is that with call spreads, there is no risk of getting eliminated by price movements. If you are looking to maximize profits or minimize your losses, you can either stay in the trade for longer than one week or close it early.

Knockouts: Contract brackets, also referred to as knock-out trades, enable traders to set a minimum and maximum price for their trades on a weekly basis. In the event that either the floor or ceiling is reached, the trade will be canceled automatically. Knock-outs are a type of derivative trading instrument that functions similarly to a stop-loss or take-profit order. They can be sold before expiration if either parameter is not reached and expire after one week at maximum.

Nadex Indices

Nadex customers have the possibility to buy contracts for U.S. and global stock indices. Nadex offers trading opportunities for a range of popular indices, such as the Dow Jones Industrial Average, S&P 500, and Russell 2000. Contracts for the FTSE 100, China A50, Nikkei 225 and German DAX indices are available to purchase.

Nadex Forex

Nadex is a renowned trading platform offering its customers the opportunity to make profits from foreign exchange markets. It provides access to 11 different currency pairs, including USD/EUR and USD/JPY amongst other major ones.

Nadex Commodities

Nadex offers traders a variety of options in terms of commodities. These include binary options, call spreads, and knock-outs. Precious metals such as gold, silver and copper can be traded, in addition to energy resources like crude oil; natural gas and agricultural products such as corn and soybeans.

Nadex Macro

Now you can trade on U.S. macroeconomic factors like unemployment rate with binary options provided by Nadex, similar to commodities or forex markets. This opens up a new way to bet on economic data and benefit from the outcomes of the markets accordingly. Besides stocks, you can also invest in options contracts related to weekly jobless claims, nonfarm payrolls and future GDP stats.

Nadex Mobile App

Nadex does not have a native mobile app, but provides a convenient experience for traders through their NadexGO web-based app. This progressive platform can be accessed from any device without the need of downloading anything from the Apple App Store or Google Play. In order to access the NadexGO app, open your mobile browser and enter the URL. The mobile experience is almost identical to desktop experience, so it doesn’t make sense to rate a standalone mobile app. Nadex is compatible with tablets and smartphones, but the experience offered by it does not present any significant advantages or disadvantages.

Overall rating for Nadex

Nadex is an established trading platform providing a range of sophisticated derivatives for purchase and sale. This platform is well-regulated, ensuring all customers have access to reliable and secure trading options. Binary options and call spreads can be traded effectively in well-lit markets, allowing investors to make informed decisions. Unfortunately, there is not enough regulatory oversight to deter bad actors. Nadex, as an exchange instead of a broker, is incentivized to offer clients the best trading environment. Their incentives are therefore designed with their clients in mind. 

Commissions charged by Nadex may be quite expensive, but they are easy to comprehend. Furthermore, the company provides a lot of useful educational content which informs customers about their policies and how to trade instruments like binary options. Although the market is under legal control, it doesn’t signify that everyone should take part in it without further research. Nadex offers derivatives markets which can be quite challenging to understand. 

The Commodity Futures Trading Commission (CFTC) has warned that trading binary options is highly risky and can potentially lead to significant losses. Binary options represent a substantial financial commitment. Therefore, before you dive into trading, it is important for you to understand the risks associated with them. If you are unfamiliar with this type of investment, ensure that you do your research and seek advice before opening a trading account.

FAQ

How does Nadex send tax information to IRS?

Nadex will send you the Form 1099B once a year for tax purposes. All earnings are reported to the IRS.

What are the disadvantages of using Nadex

There is no mobile app, only derivatives trading and a $250 minimum deposit.