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Nadex – Broker Review and Trader Feedback

4.6 / 5

Attention! We advise to refrain from trading with this broker. We recommend choosing this 👉🏻 reliable broker. For traders from USA, Canada, Australia use 👉🏻 this broker

Nadex or the North American Derivatives Exchange is an American binary options trading platform that was initially established in 2004. Then, it was known as HedgeStreet. Prior to the introduction of binary options trading, HedgeStreet specialized in offering derivative trading called “Hedgelets” for individual private investors to speculate or hedge against price movements or economic events. In 2007, HedgeStreet was taken over by the IG Group and restructured as NADEX. Today, Nadex specializes in offering binary options trading to U.S residents and international traders.

1. General Information

With their head office located at Suite 2675, 311 South Wacker Drive, Chicago, Illinois, Nadex is a subsidiary of IG Group Holdings Plc. The trading platform was formerly known as “HedgeStreet” until it was bought over by the IG Group for 6 million USD in 2007 and rebranded as the North American Derivatives Exchange (Nadex). As a financial services provider that is based in the U.S, Nadex is regulated by the Commodity Futures Trading Commission (CFTC). Unlike offshore based or European binary options brokers, Nadex does not act as market marker, by taking the other side of a trade. It acts purely as an intermediary facilitating binary options trades between traders.

2. Advantages and Disadvantages

Accept US and International Traders: Nadex is the only legally authorized binary options broker that is permit to accept U.S based traders.

User Friendly Trading Platform: The Nadex Trader is simple to use but also comes with numerous advanced trading tools.

Top Notch Customer Service: The customer support service at Nadex is unrivalled in the industry.

Comprehensive Educational Materials: There is an extensive library of educational materials on the Nadex learning center.

Fees charged on withdrawals: Withdrawals at Nadex are subjected to a fee of $25.00.

Limited Customer Support Service Hours: The customer support service is only reachable during the regular office hours in the U.S.

3. Trading Conditions

Nadex’s business model is based on fair exchange trading. However because Nadex operates with a different business model from the majority of the binary options brokers operating around the world, it is difficult to make a direct comparison between them. For example if a Nadex’s trader purchases an option contract with a price of $40 with the strike price at $100, his payout will be 120%. But if the trader purchases an option contract at $70 with the strike price at $100, then his payout will be about 43% only. The risks which the trader faces are more dynamic than European binaries. Nevertheless with the trading cost fixed at $0.09 per lot and capped at a maximum of $9.00, the returns are more lucrative than European binaries and offer better trade value.

4. Underlying Assets

Nadex do not have an asset list which is as extensive as European or offshore based binary options brokers. Nevertheless, Nadex’s traders do have the ability to trade in selected global market indices, 10 major currency pairs, 7 different types of commodities and “events” such as the announcement of unemployment figures and interest rate changes.

5. Trading Platform

Nadex has 2 main types of trading platform, the Nadex Trader platform and the Nadex Mobile Trader. The Nadex Trader being a web-based trading platform is easily accessible with any web browser. Through the Nadex Trader, traders are given direct market access (DMA) hence helping to ensure full transparency with regards to the pricing of the binary options contracts. The Nadex Trader also comes with an advanced charting package and a range of technical indicators. These trading tools no doubt help to enhance the analytical ability of Nadex’s traders. In addition, the platform can also be customized. Users of the Nadex Trader can change the way how they view the various functionalities and data that are displayed on the trading platform. The Nadex Trader also boasts of a high reliability rate. Uptime is 99.9% hence ensuring traders will not have their trading activities disrupted in any way.

Overall, the Nadex Trader is not as sophisticated as the trading platforms adopted by its offshore counterparts. But it does offer traders more control over their trades like the ability to close a trade early.

6. Mobile Trading

Apart from the desktop Nadex Trader, Nadex has also provided their clients with the Nadex Mobile Trader which is fully optimized for mobile devices such as smartphones or tablets. The apps are available for download at Google Play Store or Apple’s App Store and allow traders to track developments in the financial markets in real time, execute trades, create watch lists and to check their trading account balance.

7. Demo Account

Nadex also offer a free demo account which potential clients can try out to help them get a feel of how their trading platform works. The demo account comes preloaded with $25,000 virtual cash which can be utilized to carry out paper trades. Since, the demo account is an unlimited time demo account, registered traders can also use the demo platform to back test their trading strategies without risking their trading capital

8. Account Types

Apart for the demo account, Nadex has also provided its clients with a choice of 3 main types of trading accounts:

Individual Accounts for U.S Residents
Requirements: Permanent U.S Address, Date of Birth, Social, Security Number, Copies of documents showing all the required details.

Individual Accounts for International Traders
Requirements: Permanent Home Address, Date of Birth, National,Identification Number, Copies of documents showing name, address and date of birth.

U.S Business Account (For Trusts, Companies or Partnerships)
Requirements: Authorization to act on behalf of the corporate entity, Documentary proof of status and ownership of the corporate entity, ID of each signatory on the membership form, Nadex Entity Membership Agreement, Unanimous Consent Resolution, W-9 Form.

9. Opening an Account

Opening a trading account at Nadex is free and a simple process. To initiate the account opening process, simply click on the “Open An Account” button located at the top right hand corner of any of the web pages on the Nadex’s website. Fill in the online application form with all the necessary details. Once you have completed the form, simply submit the form. The whole process will take roughly 5 minutes and once you have opened an account, you are under no obligation to trade unless you are ready.

10. Funds Withdrawal

In terms of fund withdrawals, the options are limited to ACH transfer, debit card withdrawals or bank wire transfers for U.S resident traders. For international traders, they can only withdraw through their debit card or through bank wire transfer. Withdrawals will normally take 3 to 5 days to process and require a processing fee of $25. The withdrawal process at Nadex is more stringent that offshore based brokers due to the various regulatory requirements imposed by the CFTC. For more details, you are advised to contact customer support for clarification.

11. Trader Training

From our observation, we noted that Nadex is one of the few rare binary options brokers that are dedicated to providing their traders with quality trading education. There is a wide range of free educational resources such as handbooks and webinars which can be accessed by anyone. However, Nadex has also reserved some resources that are only accessible to those who have registered with Nadex. Apart from handbooks and webinars, other resources include:

• Detailed Glossary
• Informational Videos
• Trade Examples
• News and Market Commentary

There is a also an FAQ section provided that goes a long way towards answering some of the more commonly asked questions.

12. Should I Trade With Nadex?

Most binary traders are often confused about what Nadex has to offer them as a binary options broker. This is because Nadex is not your typical broker that you see on the internet every day. It is in fact an exchange where traders meet together to conduct their trading activities. Nadex does not participate in the trading activities itself but rather provides the platform for the buyers and sellers of binary options to conduct their transactions as well as to ensure that all the activities are in compliance with the SEC and CFTC regulations. What is important to note about Nadex is the fact there is no conflict of interest that most binary traders with offshore binary brokers face. Nadex has no interest if you win or lose. It simply makes money from the $0.90 from each lot that you trade. On the Nadex platform, you are trading against other traders with Nadex merely as the intermediary. In short, Nadex is a trading platform that is worth trading on.

Reviews on Nadex

Comments about Nadex
( 2 )
User rating: 4.5 / 5

Comments: 2

  1. avatar
    Eric Castell

    Before you start trading you learn and rely on the demo platform to get to know your broker. I was able to double my $25,000.00 Dollars demo account in about 6 months; Pretty fair for and experienced trader like me. However when I funded my account to start trading I was surprised about the big difference between the instruments and options available to trade, nothing like in the demo account. To make the story short you have to be very lucky to find a good trade on Nadex. Save yourself time and money and keep looking for a better broker. If you start trading with Nadex you are doomed.

  2. avatar
    tony luis

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