Is binary options trading available in TFSAs?
We’re glad you contacted us with your question! The types of investment products you can have in a TFSA are set out in income tax rules. You can visit the Canada Revenue Agency’s website to see a list of investments that qualify.
Binary options are said to be like an “all or nothing” wager on how an underlying asset will perform in a limited amount of time. This can make investing in binary options extremely risky, even for seasoned investors. The Canadian Securities Administrators (CSA) are increasingly concerned about binary options trading platforms that are targeting Canadians. The organization recently issued an investor alert to make it clear that no business is currently registered or authorized to sell binary options in Canada. Along with the high investment risk associated with binary options, the online trading platforms used to trade binary options also have a high potential for other frauds (e.g. refusals to credit customers’ accounts or reimburse funds after accepting investors’ money. Even the potential for identity fraud has been linked to scam binary options platforms. Learn more about the risks and frauds associated with binary options.
We strongly encourage you to reach out to our Inquiries and Contact Centre for information. Our Contact Centre also can tell you whether a company is registered to sell investments in Canada. Get in touch by phone (1-877-785-1555) or by email (email@example.com).