Binary Options Robots
Trading with binary options robots, also known as bots, helps automate the purchase of binaries. Contracts are purchased following pre-determined instructions and criteria, or in response to trading signals. Importantly, automated trading software, whether free or paid-for, can save time, reduce emotional interference and put successful strategies on autopilot.
This review of binary options robots explains how algorithms work, the pros and cons, plus tips for setting up your own bot. We also cover how to compare the top binary options bots in 2024.
Top Brokers With Binary Options Robots for United States
Binary Options Robots Explained
Trading with binary options bots is popular with investors around the world, from the USA to Europe, Australia and Nigeria. Algorithms essentially scan the markets to identify and capitalize on trading opportunities. Some programs specialize in high/low options on a breadth of traditional financial assets while others focus on touch/no-touch, range and ladder contracts on specific markets, such as cryptos.
Bots are built using a programming language such as Python and Javascript. Traders can download pre-built solutions for free or develop their own custom solutions using MetaTrader’s MQL4, for example. Importantly, the binary options robot will decide when to buy a contract based on pre-agreed instructions and inputs, for example, premiums, minimum payouts and expiry times.
The top binary options bots promise win rates of over 85%. However, as we will explain below, there is a range of factors to consider when choosing between providers.
Example
To bring to life how a binary options robot works in practice, let’s look at an example…
We download a free bot that specializes in buying high/low contracts on precious metals over a short time frame. Using technical analysis and sophisticated pattern recognition software, the program automatically opens 1-hour high/low contracts on gold, silver and platinum when it believes the price will rise. The bot will automatically open positions with returns credited directly to the trader’s account, minus any fees.
Note, there is no guarantee that robots will always generate returns, so users will need to monitor results and make amendments to trade parameters, as needed.
Benefits
- Saves time for traders
- Faster order executions
- Decisions are made based on logic
- Popular with binary options beginners
- Many free software downloads with trial periods
Risks
- Some scams and unreliable bots
- No guarantee of trading profits
- Human input is still necessary to set the right parameters
- Beginners may become dependant on bots and don’t develop robust market knowledge
Free Vs Paid Robots
Binary options robots can be downloaded for free from brokers like IQ Option. Alternatively, investors can buy algorithms for a one-off fee (sometimes costing thousands), or via a subscription model. Unsurprisingly, paid bots tend to offer higher payouts and have a more reliable track record of producing results. The best binary options bots are also available with a free trial so you can test algorithms against historical data.
For established traders, building and selling a binary options robot on MetaTrader’s Market can be an excellent way to generate passive income. See further below for more tips on building your own software.
Comparing Binary Options Bots
With thousands of binary options trading robots available online, knowing where to start can be tricky. Compare solutions using the checklist below.
Parameters
Some traders make the mistake of thinking a binary options bot does all the work for them. And while some algorithms remove a lot of trader input, you may still need to choose the best settings and parameters for your strategy and investment objectives.
For example, some traders limit their risk to 1% or 2% of their total capital per trade. This is because the binary options market is risky with more than half of traders losing money. As well as trade size and risk parameters, you also need to consider expiry times and binary contracts.
Note, how much you can amend the bot will depend on the algorithm you buy and whether you develop your own solution.
Fees
The first aspect to look at is fees. Some binary options cost over $1,000 which means you will need to make over $1,000 in profit before you break even. Fortunately, other providers follow a subscription model where they take a cut from every trade. Alternatively, you could follow a weekly or monthly pricing model. If you do plan on spending big bucks, check whether there is a demo period.
For beginners starting out, there is also a long list of free bots from legitimate sources like MetaTrader’s Market. Over 1,700 bots are available, with many designed for binary options trading. Users can buy, rent and download solutions with access to customer ratings, various trade parameters and success rates.
MetaTrader Market
Note, some binary options robot providers will claim their algorithms can be used for free but require a minimum account deposit of $200+. Be wary of this when thinking about your budget.
Security
Although there are many legitimate binary options robots available, there are also scams. Between 2012 and 2017, 2,605 victims lost £59.4m on binary options scams in the UK. So when bot providers advertise a success rate of over 90%, traders should be careful that statistics aren’t inflated.
With this in mind, traders downloading bots from an unknown website should check reviews and ratings from other users. Another way to check the legitimacy of a provider is to look at their trading volumes. The binary options bot, MT2 for example, has sizeable volumes in excess of $165,000,000.
Also remember that some binary options robots are only available with certain brokers, so you need to ensure you are comfortable that these brokerages are reliable. Check they hold a license with a reputable body, such as the UK Financial Conduct Authority (FCA), the Cyprus Securities & Exchange Commission (CySEC) or the Australian Securities & Investments Commission (ASIC).
Compatibility
Binary options trading robots may also need to be updated with the latest software to ensure they are effective and can operate quickly and efficiently. Even a bot downloaded in 2020 may no longer be able to make the high-volume binary trades needed in today’s market without an appropriate update. For example, version 1.11.0.0 of IQ Option’s binary options robot is available for download online but multiple other versions have since been released.
Demo Account
Demo accounts are a useful way to test binary options robots without risking real money. If you aren’t sure whether a particular provider is reliable or if there are limited user reviews, paper trading accounts can be a helpful way to test their performance with historical and live market data. BinaryOptionsRobot.com, for example, offers a $10,000 demo account to speculate on forex and cryptocurrencies.
Features
Another element to consider is the type of robot. Some programs will automatically copy the positions of other binary options traders, while alternative solutions may make suggestions based on news announcements or volume metrics. Decide whether you want a fully functioning, automated bot or a program that simply makes trade suggestions or mirrors other investors.
See here for information on finding a binary options signals provider. Click here for guidance on copy trading services.
Brokers
Some binary options robots have to be used with a specific broker while other solutions allow integration with a handful of platforms. Open an account with a brokerage that supports MetaTrader 4, for example, and you will have access to a long list of compatible bots. With that said, websites that specialize in binary options robots may provide more effective, premium quality solutions.
Building Your Own Binary Options Robot
There are many benefits to building your own algorithm. Fundamentally, making one from scratch means you can create a bot suited entirely to your trading strategy. On the downside, you will need good coding skills and to be familiar with a programming language like Python.
Fortunately, MetaTrader 4 and MetaTrader 5 both offer an integrated development environment for building and backtesting your own bot. This is a good place to start for beginners. Once the bot is ready, you will need to open an account with a binary options broker that has a public API so you can integrate the algorithm with their platform.
Bottom Line on Binary Options Robots
Trading binary options with robots enables you to automate successful strategies, allowing you to focus your efforts on other strategies and investment activities. There is a wide range of free downloadable bots that specialize in different binaries, expiries, and markets. Paid-for programs are also available at leading brokers and websites. These may come with a hefty price tag, but they could offer better results. Our final tip is to test bots out in a demo environment before committing large sums.
FAQ
Do I Need To Pay For Binary Options Robots?
Although paid-for bots may be of higher quality, there are many free programs out there that function effectively. The most important thing is trialling the bot before you begin trading or backtesting it using historical market data. Also check customer reviews and ratings before spending money.
How Do You Create Your Own Binary Options Robot?
A binary options robot can be built using a programming language like Python. In addition, traders can develop binary options robots through MetaTrader 4 (MT4) and MetaTrader 5 (MT5) using various extensions. MetaTrader bots are also known as Expert Advisors (EAs).
Do Binary Options Robots Remove All Human Input?
No – it is a common myth that trading bots require no human involvement. The truth is that a trading robot is only as good as the parameters and settings it is given, and these are determined by the trader. The more effort you put in upfront, the better the results are likely to be.
Where Can I Get More Information On Binary Options Robots?
Online forums may contain reviews from other traders. You can also read reviews of our supporting brokers. Finally, social media channels like Telegram and Discord host active trading communities that share tips and tricks.
Do You Have To Keep Your Computer Turned On If You Want A 24/7 Trading Bot?
No – traders using binary options robots 24/7 often leverage a cloud hosting or virtual private server service like AWS or Digital Ocean. With that said, not all brokers, including IQ Option, support a VPS.