MoneySavingExpert.com founder Martin Lewis has been quick to discredit a "fake advert" that claimed he made money out of a risky form of investment known as 'binary trading'. Not only has Martin never invested in binary options, he would never recommend that others do so.
An advertorial article circulated online earlier this month falsely claimed Martin had "boosted his income with online trading". The article also attributed bogus quotes to Martin that urged others to get involved in binary trading before it was too late.
MSE's legal team has investigated. The article is no longer appearing online. However, a number of other high-profile celebrities continue to be linked to the practice of binary trading in similar advertorial pieces.
'I've never binary traded, don't touch it'
Martin was appalled to discover his name being used to promote binary trading and he's warning others not to be tempted into sinking their money into this risky form of investment, which isn't regulated by the Financial Conduct Authority (FCA).
Warning:This is totally fake advert and a CON. abusing my name. I've never binary traded. I never would. Don't touch it. PLS SHARE pic.twitter.com/gJHLxxhh3Q
Martin Lewis (@MartinSLewis) February 8, 2017
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What is binary trading?
Binary options are called 'binary' because there can be only two outcomes win or lose. To trade, all you need to do is bet on whether the price of something will rise or fall below a certain amount if it's correct, you win and get paid. If not, you lose all of the money you originally invested.
You can choose various commodities to trade in such as gold, oil or stocks etc. The value of a binary option is made up from the value of the asset you want to trade.
For example, you could bet at 2pm that the value of gold will increase or decrease in price by 2.05pm. You are not buying or selling the gold, just predicting whether the price of it will rise or fall. Time periods involved tend to be very short (five or 10 minutes) but some firms offer longer periods to bet over.
At present binary options are regulated by the UK's Gambling Commission, but only if the firm has remote gambling equipment located in Britain.
If this is not the case, any binary options that the firm offers will not be regulated by the Gambling Commission or the FCA.