Even though trading binary options can present some sort of risks, it is considered as the less risky way of trading where earning high return is very fast.
Risks of Binary Options
While speaking of online trading, the trader is given the possibility to start trading with a minimum amount of money of $10 according to the trading tool chosen. The binary options risk is reduced as it gives the opportunity to the trader to invest as little as he can afford to lose. Furthermore, the brokerage platform usually clearly indicates to the traders the exact amount they have the possibility to win and the amount they will lose, prior to the investment that made. If the return or the potential loss prediction do not suit the trader, the latter will have the opportunity to change his investment to a smaller or greater amount.
Therefore, binary options trading give the opportunity to traders to evaluate the risks before they invest their money, which is a feature that other forms of financial trading do not provide. No matter how much the financial market moves, the trader will always be aware of his potential losses.
Online Trading Investment
Binary trading is becoming increasingly popular among traders all over the internet. This popularity is due to the completely different way of trading they offer. Moreover, the traders have the ability to monitor their online trading investment by trading the amount of money they want. This way of trading accepts a minimum investment of $10 per trades, making the online trades very affordable according to the trading tool chosen. Furthermore, Binary Options offer a wide range of financial assets to invest in such as Forex, commodities and stocks.
- Forex – Which describes changes in foreign currencies such as USD, EUR and AUD
- Commodities – Metals such as Gold and Silver, Oil and several more
- Stocks – These are huge companies such as Google and Apple which are available in the asset list.
Nowadays traders engaging on binary options platform, want to generate high profits in a relatively short period of time. Compared to other traditional financial trading methods, options trading generates a very fast return. It offers the opportunity to have a profit margin up to 85% from the initial investment made. The expiry times available on the trading platforms is relatively short depending on the trading tool chosen. For example, when using the Speed Option tool, the expiry time usually stand between thirty to three hundred seconds. On the other side, traditional trading is held for longer period of time and can go up to many years in some cases. The opportunity to trade rapidly on financial markets combined with the potential of earning high returns is one of the most attractive feature of binary options trading. If a trader succeeds to chain a few winning trades, he can make a substantial profit in less than two hours.
Is Binary Options Easy?
In order to speed up the process from the initial investment to the first trade, brokers have ensured that trading binary options are as simple as possible. Besides, there are only a few steps involved between the signing up to a platform stage and choosing the financial asset the trader will choose to invest on. Those steps also include the choice of the amount the investor wants to trade, the selection of the asset he wants to trade with and the direction he thinks the market will move by the end of the expiry time. The trader gets through all these stages in only a few clicks making binary option very easy.
Furthermore, the profit or loss the investors will encounter will depend upon the fluctuations of the value of the asset. If a trader believes the market is rising, he would place a “call.” Whereas if the trader believes the market is falling, he would invest on a “put” option. In order to ensure that a “call” option is profitable, the closing price should be greater than the strike price at the expiry time. Accordingly, for a “put” to be profitable, the price must be below the strike price at the expiry time.
As most of the trading platforms are web-based, they can be accessed everywhere without any downloads as long as the trader has an internet connection. This availability makes it easy for the traders to regularly and conveniently check their options and monitor the financial market on a 24/7 basis. Besides, as the platform offers the access to international markets, traders can constantly keep trading at any time of the day. Moreover, the web-based platforms are now available on desktop computers as well as laptops, tablets and mobile phones which increase the trading access. The mobile application is very popular and is compatible with both Android and IOS software.
Trading binary options is the new trend nowadays. This growing popularity and notoriety in some isolated cases came from the fact that it is quite simple to get embark on this adventure that it is widely available. In order to avoid being on the wrong side of the road, the trader should, first of all, make thorough research in order to choose the most reliable brokerage firm. While speaking of binary option trading, the choice of the service provider is the hardest step for two reasons. The first one is because there is a vast amount of options trading firms and the second reason is that not all of them are regulated and will respect their promise. Therefore, this crucial choice will determine the whole journey of the trader. Once this step done, it is advised whether you are and experienced trader or not to carry out some research about the financial market and to wisely use the educational tools the platform you have chosen gave to you.