In this review we have a look at Mike Perona’s Full Arbitrage Trading Tool that has the potential to lose you a lot of money.
What it is about
So he created an automated tool that generates trading signals and now he is selling it for $49.50 one time fee plus $19.90 per two weeks. Is it worth it?
Stay away from the Full Arbitrage Trading Tool
There are several serious reasons why you should not invest your money with the Full Arbitrage Trading Tool.
First of all arbitrage trading on binary options is a complete nonsense. It’s funny, because Perona is kind enough to put the true definition of arbitrage trading on his web page.
“ARBITRAGE, IN ITS PUREST FORM, IS DEFINED AS THE PURCHASE OF SECURITIES ON ONE MARKET FOR IMMEDIATE RESALE ON ANOTHER MARKET IN ORDER TO PROFIT FROM A PRICE DISCREPANCY. THIS RESULTS IN IMMEDIATE RISK-FREE PROFIT.”
So, by definition arbitrage trading is not possible with binary options. With binary options you cannot buy a security to sell it on another market (with another broker). All you can do is to buy binary options with different brokers, but then again, the return ratio of one option never reaches 100%, so if you buy a call and put option at the same time on the same asset, it is a guaranteed loss.
So, Perona is using the arbitrage term here just to look interesting, but you need to know just some basics to see that he is full of BS.
The Full Arbitrage Trading Tool is not only a nonsense, but it is also very dangerous. We had a lookt at Perona’s video and we could see that his tool generates some trading signals. We know that it has nothing to do with arbitrage trading, so who knows what they are based on.
The second element of his strategy is Martingale. For those of you who don’t know what Martingale is, it basically is a very dangerous money management strategy. With binary options it means opening a trade in the same direction and doubling (more or less) your investment until you win. Every new investment has to be able to cover all the previous losses in a series.
Martingale is very dangerous, because you need just one longer sequence of bad trades and you can wipe out your account, or at least sustain a big loss that will erase a lot of your previous profits. You just need to open any financial chart and look at it, you will see that it is not uncommon to see 4, 5, 6, 7 and sometimes even more candles in a row going in the same direction.
So, when you hit such a movement in the bad direction with Martingale, you can lose thousands of dollars, meanwhile your basic investment is $10 and your average profit $8. So if you don’t lose your entire account, you can lose profits that you worked on for a year…
Look at the picture, he used a stock photo that is used by many other websites.
And finally just a quick note on the Byrix binary options broker. Perona pushes you to Byrix with his Full Arbitrage Trading Tool. But Byrix is a broker that is not regulated, so your money will not be protected and in case of problems nobody will help you. The rate of scams among unregulated brokers is big.
The Full Arbitrage Trading Tool of Mike Perona is a dangerous nonsense. We believe that it will only lose your money, so we recommend staying away from it.
You can try trading on a free demo account with a regulated broker to see that arbitrage is not possible with binary options and that the Martingale strategy will sooner or later wipe out your account.