Introduction to Binary Options Trading

When one thinks of trading, fears of falling initial investment and financial failure always loom. No one is ever prepared to easily lose hard earned money to a bad trade. That is why knowledge of the business is a must in any venture that one undertakes. There is no success without hard work, or hard thinking, and this is true for every business. Being prepared and knowing what to look forward to partially removes the fear of investing a certain amount of money.

In market trading, it is usually the case that many unforeseen signals are not factored in. This is especially true for many unsuccessful trades. Every undertaking has an infinite number of ways to go, and each one is affected by every other undertaking there is. That sounds complex to the point of getting risky. But if you are trying to cut your losses, you can start by lowering your risk levels.

The same principle applies to almost every decision traders need to make. Whether it’s considering one signal and forgetting another, the money always seem to find its way to where we want it to earn. The complex algorithm becomes readable if the right information can be extracted from them. Trading becomes simple when we relate it to everyday products, businesses, and trends. That is when a trade really becomes tangible.

Slow and Steady vs. Striking Hot Iron Binary Trading

No matter how you large you think you would like your profit to be, there should always be a strategy that you should follow so you can achieve your goal. Ranges of investment may differ, and where your profit goes is entirely up to you. But, having a low-risk system almost works every time. As the saying goes “Slow and steady, wins the race”. You get to learn about improving your trading skills as you slowly go along with low-risk options.

However, some want to strike while the iron is hot. Every successful trade seems to propagate to more successful trades for some people. If you are one who feels lucky all the time, you should know that there are also ways of amassing profit while lowering risk factors. After all, business is part luck, but mostly analysis and execution. If one could minimize the risks enough, eliminating the luck part becomes theoretically possible.

Binary options trading offers a good and sound means of investing in the market while keeping your finances in control. It is a relatively new type of trading where the trader makes a prediction on how the price of a commodity or stock will move: Up or Down. That sounded simple enough, right? That’s because it is THAT simple. Smart binary options trading should take a lot of the risk out of having to predict the right price or a price range. It only requires you to predict whether the price increases or decreases in a certain time frame.

Strategies also play a major role in your success rate with binary options trading. Since this is also an investment, you are going to need a lot of research and know-how on how the market works. That’s where it gets a little bit complex. But not too much if you have the right binary options broker to work with. To make a lot of money in binary options on a consistent basis, you are going to need the right tools to help you make the right decision that gets you the highest returns, but keeps your risk low. Choose from our list of top binary options brokers online today!

Binary Options Basics

Binary Options comes from the words binary, literally meaning “in two’s”, and options, where options are derivative instruments in the market. This derivative instrument is taken from an underlying asset, which is sold in contracts depending on the directionality of the asset. Combining the two words, binary options is a derivative instrument that is based on an underlying asset, that depends on a dual directionality.

You may purchase:

  • Call Options — if you think the price of an asset is going up
  • Put Options — if you think the price of an asset is going down

Binary Options Assets

The choice of underlying assets that can be traded is entirely up to the trader. You can trade:

  • Stocks
  • Forex
  • Indices
  • Commodities

Since binary options are based on an underlying asset, a trader can pick whichever instrument he is most comfortable with. In choosing an asset to trade in, there are certain factors that need to be considered. An example of this would be volatility. Volatility refers to how much a price fluctuates over a given period of time. Forex has more volatility than the other types of assets.

Trading Times

You are going to be trading different assets. For different financial instruments such as Forex, indices, and stocks, the trading time matters. Depending on what type of asset you are trading, there are only specific times when you can transact your trade. For example, if you are trading U.S. stocks, then you will be trading whenever the U.S. stock exchange is open, which is 9:30 A.M. to 4 PM Eastern Time.

If you’re trading Forex then you can trade any time from 5:00 pm Sunday Eastern Standard Time to Friday 5:00 pm also Eastern Standard Time.

Requirements for Trading

Almost all binary options brokers require the trader to be 18 and above. You do not need a lot of start-up capital or a fancy computer system. You don’t even need a degree in finance or in any business field for that matter. For binary options trading, all you need is a functional computer with an Internet connection, as most binary options brokers have a web-based system.

If you have some spare time to trade, spare cash, and a determination to learn and succeed, you can definitely start trading binary options.

Why Trade Binary Options?

First of all, it is easy to profit from binary options. You know what you are risking and you know how much you are risking. You also know what the payoffs are. Depending on the broker, you can open an account for as little as $100. Minimum trade size ranges from $1 up to $25. And payouts range between 65% — 90% on your money. For example, if you invested $100, you could possibly get $100 + 65–90% of your investment.

If you lose some brokers even give you 15% of your investment. From our $100 example, you get $15 for unsuccessful trades.

Some Sample Binary Options Brokers

24Option, Banc de Binary, and Traderush are some of the top binary options brokers. The first two have a minimum deposit of $250. Also, all three brokers offer the usual Call/Put functions plus other derivatives of binary options trading. There are demo accounts available for many binary options brokers, and you should take advantage of them to practice your strategy.

If you deposit enough funds, binary options brokers also provide you with a personal broker which assists you is your trading and provide you with information that you would otherwise not know. Ranging markets and trending markets are the specialties of many top binary options brokers. They should be able to help you make informative decisions based on the trending signals that are globally available.

We will certainly help you find the right binary options brokers.

Read more articles on Education.

Binary options trading involve risk. Although the risk of executing a binary options open is fixed for each individual trade, it is possible to lose all of the initial investment in a course of several trades or in a single trade if the entire capital is used to place it. It is not recommended to base your investment decisions on any information presented on or originating from BinaryTrading.com. By browsing this website you express your acceptance of the terms of this disclaimer and that BinaryTrading.com cannot be deemed responsible for any losses that may occur as a result of your binary option trading. BinaryTrading.com is not licensed or registered as a financial consultant or adviser. BinaryTrading.com is neither a broker, nor funds manager. The website does not provide any paid services. All content of BinaryTrading.com is presented for educational or entertainment purposes only.

General Risk Warning: Trading in Binary Options carries a high level of risk and can result in the loss of your investment. As such, Binary Options may not be appropriate for you. You should not invest money that you cannot afford to lose. Before deciding to trade, you should carefully consider your investment objectives, level of experience and risk appetite. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to Binary Options or (b) any direct, indirect, special, consequential or incidental damages whatsoever.

BinaryTrading.com is compensated partially through the affiliate commission earned from some of the listed brokers.

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