In fact, forex, spread betting and binary options are all forms of gambling in disguise. What differentiates between them and "standard" gambling is just the theme.
When you bet for, or against, a sports team, you're make a wager, but when you're depositing your funds into a platform that allows you to bet against currency movements, all of a sudden, it's called investment.
Websites like Investing.com, Finance Magnets and Made to Trade are somewhat more legitimate than other websites on the internet that bluntly suggest you can easily get rich through the trading of financial derivatives. The same message is (of course) encouraged by the FX, spread betting, and binary options brokerages. Though they do have to comply to some form of regulation (FCA in the UK, CySEC in Europe, and FinCEN in the USA) - it's never tight enough, except for US-registered companies (and there hardly any as the liquidity and advertising requirements that are presented are extremely steep).
So what, essentially, is the difference?
Binary options are the closest form of so called financial investment to gambling. The time frames are short, as as suggested, the win/lose situation is binary. It's not a gradual process at all, except for rare cases like Nadex which is CFTC regulated, but instead, an all or nothing wager.
Anyone who claims he can predict a the movement of a currency in short time frames, up or down by several pips, is either a genius, a liar or a fool. Considering all terms are fair (and with multiple firms they aren't) you have a 50-50 chance of winning or losing. The best thing about it that like with its entertainment counterpart, the house always wins. The reason is that binary option providers pay only 85% on winnings, but charge 100% off losers.
This is an unbeatable type of system that can only result (in the long term) in money loss.
Spread betting and forex trading are a tad different. The winning/losing isn't binary, and in theory, traders can use little or no leverage at all, which can remind us legitimate currency contracts like swaps or futures, and also legit financial derivatives like longs and shorts. Some FX companies like Oanda also specialize in providing business solutions to hedge currencies.
Pro traders, which account roughly as 20% of all traders, use various systems and let their money ride. They don't necessarily going to make profit, but knowing the system, if they use a fair foreign exchange broker, they are more in the trait of "skill gaming" like professional poker players, professional punters, professional backgammon players, and other groups which rely on luck to some extent, but in the long run can benefit from having better skills than competitors.
Most traders are not professional at all. Part of them are betting blindly, constantly switching between instruments, and they do it for the thrill of gaming. Casino and poker gaming is prohibited in some part of the world (mainly Muslim countries), and these audiences find something else to replace the thrill which is not considered as gambling by Sharia law.
The saddest part of the bunch are the traders who are in it for profit, but have no clue what they're doing. They will be following "signal software" that supposedly reports them when to invest and how, but in practice doesn't work (else why would it owner be selling it), or worse than that - they'll let a broker from the brokerage they have signed up with trade on their behalf, or consult them how to trade.
Many brokerages benefit directly from the losses of its clients, and there's a serious conflict of interests. It's always good to use common sense.
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