What if you could maximize your profits in a shorter time? Lets say Make in 2 hours what you normally make in 2 days. Would that be more your style of trading?
What is binary options?
Binary options is still Forex trading but at small time intervals and only 2 options to choose from as the name binary suggests. Traders only tell whether a currency pair will go up or down in a given time and if they are correct then they will gain a huge profit.
Binary Options is to Forex what 20twenty is to cricket. It is the short, high stakes, blitz version that has extremely high risk and extremely high rewards. Most binary options brokers offer profit margin upwards of 60% returns on initial trade cost. So for instance a trader can make $60 and upwards on every $100 traded provided they get each trade correct.
How to benefit from binary options
Binary options can seem risky for the person who doesn't know how to trade it. Risk in trading is only increased by limited knowledge. Knowledge gives an advantage and is the best tool to use. With that said reducing your risk in trading binary options includes increasing your knowledge of it and how to trade it.
Although binary options is a faster version of Forex trading there are strategies to employ when trading. One such strategy is the Martingale strategy that has proven to work over and over again. it involves double each trade till you get the winning one to cover any previous losing trades. This strategy is actually from the betting world has proven to be effective trading binary options. It can be tweaked to your trading style and risk appetite. Lets say you use 5$ for your first trade, if you lose then you place the second trade for $10 and keep doubling till you win. This method is fast and doesn't require a lot of technical analysis to place a trade.
For traders who don't believe in the martingale strategy, trading binary options can be done in a similar way as day/swing trading. Traders can use indicators and expert advisors (trading robots) to maximize their trading profits.Some bots can be risky while others can give huge returns in a short time. It is recommended to test trading robots on a demo account before using your live cash.
Another benefit from Binary options is that opening an account requires less capital or rather less minimum opening Balance than opening a standard trading account with a low leverage. With this advantage most broker platforms allows you to open trade with a minimum of $1.
Difference in trading styles
There's a contrast in trading styles with binary options as opposed to day/swing trading. Binary options strategies can be a lot less analytical as well as they require you to make trading choices quickly. When you open a trade you exactly what time it will end in contrast to day trading where you set a stop loss or take profit.
Your trading style should make an attempt to limit emotional trading as this will damage your win-loss ratio. Emotions should be eliminated from trading if possible. Always use numbers to drive your trading career. Practice until you are comfortable before you go live, make all the mistakes in your demo account or atleast most of them, test all strategies and see which one you are more.
What can be tradedThe majority of Binary Options brokers provide all the Major currency pairs along with some precious metals. Other brokers will also provide some currency crosses as well as some exotic currencies.
Major Currency PairsEUR/USD: The euro and the U.S. dollar.
USD/JPY: The U.S. dollar and the Japanese yen.
GBP/USD: The British pound sterling and the U.S. dollar.
USD/CHF: The U.S. dollar and the Swiss franc.
Set daily goalsAs in everything else that you do you should trading goals when trading binary options as well. A couple of my trading friends have set daily trading targets to work towards. This way you can control your trading so that it doesn't drown out the rest for your life.
The good thing about setting goals is that you know exactly what you are working towards which is most important. With Binary options you can start with small goals let say $30 per day and increase it as your trading career, strategy and confidence increases. After some time you will be making in 2 hours what you would make in 2 days.
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