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IN the wake of complaints from investors who suffered losses, Singapore's financial markets regulator has issued a warning to investors on trading binary options on unregulated platforms.
The warning by the Monetary Authority of Singapore (MAS) comes after the police also warned the public on the matter at the end of last year.
MAS said on Tuesday that contrary to promises of low investment risks with exceptionally high returns, binary options are speculative and risky investment instruments.
There is a high chance of the investor losing his entire investment amount, whether the investor deals with a regulated or unregulated entity.
An investor is always exposed to investment risk, whether a product is regulated or not, MAS said.
The situation is made worse as many unregulated binary options trading platforms are fraudulent and based outside Singapore, MAS said.
"Investors who choose to trade with these platforms are unlikely to recover any monies lost. Investors should know that if they choose to deal with unregulated entities, they will not have access to avenues for dispute resolution should a dispute later arise."