Trading Responsibly – Binary Option Trading Advice

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    The Best Binary Options Broker 2020!
    Perfect For Beginners!
    Free Demo Account!
    Free Trading Education!
    Sign-up Bonus!

  • Binomo
    Binomo

    Trustful Broker!

Contents

How to trade binary options successfully – Basics

Notice to EU traders:

The European regulator ESMA made a prohibition of binary and digital options to retail traders from The European Economic Area starting from the 02.07.2020. In case you still want to trade binary options, you need to acquire the status of a professional trader on which this regulation does not apply. I recommend you have a look at the article – How to get the PRO status to continue trading Binary options

Binary options are not promoted or sold to retail EEA traders. If you are not a professional client, please leave this page.

Where to next? (If you do not meet the requirements)

  • FX Options – Attractive alternative to binary options?
  • Read our in-depth guide for cryptocurrency beginners
  • Read how to trade forex and other CFD instruments

Traders outside The European Economic Area are not anyhow affected by this new European rule and can trade binary options (if the binary broker operates in a given jurisdiction).

What are binary options?

Binary options are a type of online trading, where you as a trader predict thru web or mobile platform, whether the price of a certain underlying asset will go up or down. Under the term – underlying assets we have in mind stocks of major companies like Google, Microsoft, FB…, currency pairs, indices and commodities (silver, oil, gold…).

If your prediction is correct you earn a fixed amount that you know before placing the investment. In most cases, returns from binary trades range from 170% to 192% per trade. So if you invest $50 you get an additional $35 – $46 to your initial investment. To create one trade you can invest as small as $1.

Beware, though at first glance it may look simple, binary options trading is not as easy as some portals may and do say. It is possible to make a lot of money, but it’s also possible to lose a lot. An investor who does not have any previous experience with the market and does not plan to acquire it can expect a great loss. To succeed in binary trading it is essential not to be naive and not to fall for scams that promise “bulletproof systems that will make money in your sleep” which are hiding behind every corner.

Read and study with TradingBeasts.com:

  1. The Ultimate binary options guide– and other articles in our Academy
  2. What reliable binary brokerswe have tested and we use for our trades.
  3. How to create a demo accountfor trading with virtual money.

How to successfully trade binary options

In our first step, we choose an asset we want to trade. In our example, we chose the currency pair EUR/USD with an 89% return from a successful trade. The choice of an asset is up to you. There are hundreds of underlying assets which we can trade, each asset has different profitability.

In the second step, we decide, when our trade should end and evaluate. So, if we want our trade to end in 30 minutes, we select an expiration time of 30 minutes.

Subsequently, we choose how much we want to invest in this particular trade. When we trade binary options we can invest as little as $1.

Now, we have moved to the most important part of trading at which we have to decide, whether the price of our option will go Up, or Down. When you trade classic binary options, only one of these three situations can occur. Either your trade will be successful and you receive a predetermined profit, which in our case would be $50 + $44.5 = $94.5. Or the trade will end up unprofitable and you lose the invested amount (the biggest amount you can lose equals to the investment you made). The third situation occurs very rarely and we can meet with it when the price doesn’t change at all (the price of the option when we entered the trade is the same as in the moment when the option expired). In this type of situation, most brokers give the investment back to the trader.

As you’ve probably noticed we get from correct prediction only 89% extra money from the invested amount. So, you might ask “How could possibly binary options be such a good extra income?”, when you don’t even earn 100% from what you have invested. The main reason behind this is because you can use binary strategies, which can significantly help you to create a majority of successful trades. Please bear mind that even with strategies no one can accurately predict the market and make all trades winners. Without binary strategies trading would be just a hazardous game that has nothing in common with meaningful and responsible investing.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    The Best Binary Options Broker 2020!
    Perfect For Beginners!
    Free Demo Account!
    Free Trading Education!
    Sign-up Bonus!

  • Binomo
    Binomo

    Trustful Broker!

What my profit will be like?

It depends entirely on you. With the right binary strategy, you can boost your capital by a few dozens of percent in a week. Equally, with a bad strategy or without a strategy you can just as quickly lose it. The basis is to be as patient as possible and to hold to your selected strategy, which you know that works (for example from a demo account). Binary options trading is about a long-term profit and not about making one (or even a row of) successful or unsuccessful trades.

Is binary trading risky?

Any kind of trading or investing is risky and you have to count with that. If you enter the world of trading you should invest only such amounts that you can afford to lose. Some fraudulent servers (or even scams) may encourage you to borrow money from your friends or family members, if necessary because it is a guaranteed thing that your investment will return.

But we are a serious portal and we most certainly do not advocate such claims. Although binary options have a great advantage that the risk is eliminated only to your investment into the trade, we, binary traders still operate on a financial market. And there are no guarantees. The market is merciful only to those who are prepared and know the risks. For instance, traders who do not apply any trading strategy can most likely expect to lose their capital.

Advantages of binary options

A great advantage of binary options is that if the price changes only by a single pip in your direction, you receive a full profit from the trade. Let’s look at an example. You entered a trade at a moment when the oil price was set up to a value of 1.5797 and you have selected the expiration time of 30 minutes and upwards direction. A 30-minute trade ended at the price 1.5798, thus it changed only by a single pip you will still secure for your correct prediction full profit from the trade. It is because in binary trading doesn’t matter, how much the price changes, but if it changes in the direction you chose.

Is it possible to try out binary trading? (Risk-free) Demo account

For traders who do not have a lot of experience with trading (or none), the demo account is a perfect opportunity to try everything out without giving at stake your own money. The demo version works on entirely the same principle as a real account, the only thing which is different is that you are trading with imaginary chips. That means that you can not make any profit from trading on a demo account, but you also can’t lose anything (apart from imaginary funds).

Most brokers offer practice account right after you load your real account with at least the minimum deposit. However, if your trading on a demo account doesn’t reach your expectations you can at any time withdraw the money you have deposited into your real account (if you trade with a licensed and a trusted broker). But we also know about brokers who do not require even initial deposit you can use the demo version freely with no obstacles. For more information read our separate article: free demo account for binary options

Where do we trade binary options?

The term „broker“ was already mentioned in the article. But do you know, who this broker really is? A binary broker is a company that arranges the transaction between a buyer and a seller. It is basically a place where demand meets supply. Here, you can trade. Every broker has its own web platform, so no downloading is required.

There are dozens of brokers or even hundreds of them. If you are looking for a reliable and trustworthy broker who cares about their traders you need to look for certain aspects. One of them is a broker’s credibility, which can be gained by a reputation among traders and by licenses. A license is obtained by a broker in exchange for a large fee to the regulatory authorities. These authorities are responsible for constant supervision over the broker and over all their actions.

Apart from credibility, we should focus on payouts, a minimum deposit, and a minimum investment. We should also find out whether our broker provides a demo account if we plan on using it. Traders who do not speak English can also appreciate a trading platform and customer support in their native language. On our website, you may find many broker reviews. Currently, as the best option is from our point of view IQ Option, a well established binary broker with superior payouts and a free demo account.

Broker Regulated by Regulatory agencies ensure that brokers/exchanges operate in a transparent and honest way. They protect the best interestest of clients and also feature an investor compensation scheme which protects trader’s deposits up to a certain limit. Some of the major regulators in the industry include the CySEC in Cyprus, the FCA in the UK and the ASIC in Australia. Min. deposit Max. Payouts Funds which are credited to your account in case of a correct prediction Special features A list of features that provide a given broker/exchange with a competitive edge. Ad Disclosure This Comparison / Page contains links to 3rd party websites of our top partners from whom we may receive compensation at no additional cost to you.
CySEC $10 95%
  • Superior Payouts
  • FREE Unlimited Demo
VisitRead a review
ASIC $50 90%
  • €50 Cash-Back Bonus
  • Accepts only Australian traders
Visit
CFTC $250 80%
  • Accepts US Traders
Visit

General warning: When trading with real money, your capital is at risk.
Binary options are not promoted or sold to retail EEA traders. If you are not a professional client, please leave this page.
To see whether you can be classified as a Pro trader read this page

All recommended brokers went thru our testing process. In a 3 month time period, we act as a regular trader and we actively create trades as any other trader would. If we find out any problem with the broker, we mark him as „not recommended“ or even as a „scam“. The fact that a broker makes it to the selection of recommended brokers does not necessarily mean that it will stay there forever. In case that the broker is not capable of maintaining high-quality services as on the beginning, we reduce the rating of the broker on the website or we even completely remove it from the list of our recommended brokers.

How to determine, whether the price will go Up or Down? – Binary strategies

Some newbies try to do this by guessing and they usually determine the future price direction just according to the chart which is provided to them by the broker. I would not be afraid to state that such trades are completely random and made without using any strategy. But that is not the way we trade at TradingBeasts.com, we know that in order to become a successful trader who makes a long-term profit you most certainly need binary strategies.

Binary Options Trading Strategies and Techniques that actually work

Without any trading strategy, every binary trader has got half a chance to create a successful trade, because when trading classic binary options we have to only predict whether the price of an option will go up or down. That is, however, with 75-85% returns from a successful trade simply not enough and trading without using any binary strategy can never be profitable (or at least not in the long run). A binary strategy can significantly help us to increase our win. ratio and put the odds in our favour.

Following a strategy also allows you to constantly improve your results because all the trades you create have a meaning and they were built on the basis of a specific pattern. Which means you can repeat them, results which can be achieved again usually mean success. We have 2 types of strategies which we sometimes also call analysis. The first one is called technical analysis, the second one fundamental analysis. Some strategies might combine both of these analysis types.

Technical analysis

Technical analysis or the analysis of graphs engages in forecasting prices according to a repetitive pattern (formula). In order to find these patterns, we use different kinds of indicators and oscillators (such as the stochastic indicator, MACD, RSI and many more).

Some brokers offer on their trading platforms a system that can be used for complete technical analysis (One of such companies is e.g. IQ Option that has in-house built charting system). In case you seek a free service which focuses just on technical analysis, we would like to recommend you investors’ most popular analysis platform – MetaTrader 4. Here is an example of the MT4 with a 5-minute chart.

Fundamental analysis

The second type of analysis is fundamental analysis. This method focuses exclusively on economic statistics and economic changes which will most likely affect the value of assets. When we look at some large scale examples, then we most certainly have to mention the global crisis in 2008, in which investors had a great chance to invest on the drop of public securities of major companies, banks and investment funds etc.

On a smaller scale, hundreds of economic news are daily published (eg. unemployment and interest rates, inflation etc.). All of these and many more announcements are recorded in the economic calendar. These calendars include information about the impact of the news, time of their release, and the forecasted direction in which the price will most likely move. There are hundreds of economic calendars which are available on the Internet. One is even offered by IQ Option in their academy, the calendar is located in the top menu under the “for traders” section.

With what capital should I trade binary options?

The first two strategy types mentioned above are designed to predict the price, the following strategy is, however, a question of correct money management. When you fully adherence your money management strategy you will be able to get the absolute maximum from your capital, so don’t take this type of strategy lightly. Generally speaking, it is not recommended to invest in one trade more than 4% of your total capital.

Money management is very often overlooked, however, its importance is exactly the same as using any other strategy that will help you predict the price, sometimes even bigger. Take an example, your broker requires the minimum investment of $ 10 so you could open a trade. At the same time, the minimum deposit at such broker is $100. That means if you deposit only the minimum required amount, you risk in the very first trade 10% of your entire account funds; that is an enormous part of your whole trading wealth.

So theoretically speaking, you have money to open only 10 trades. Of course, all of those trades would have to end up out-of-the-money and that is highly unlikely. Nevertheless, if even just a few of them turn out to be unsuccessful (especially the first ones), you would get yourself into a big psychological pressure. Subsequently, you begin to doubt every trade and you will most likely slip from your trading strategy, which might result in further losses.

Testing binary strategies

Trading with real funds without a tested binary strategy entails high risk. For this very reason, it is of crucial importance that every trader is properly prepared before entering the real market. The most popular and effective way how one can prepare for real trading is using a free demo account for binary options. This practice account works exactly the same as the real one, with one huge difference, that you are trading with imaginary funds. Once you open a demo account try to strictly follow your strategy as you would with real funds.

The second option, how you can test binary strategies is to open, for example, MetaTrader 4 and at the time when you would normally open a trade, you make a note either to Excel or on a paper. Then you wait if the price of the asset moves in the direction you forecasted and you write down the result of each and every one of your trades. This way you will try to “create” as many trades as possible and then you calculate the overall success of your strategy.

Is Binary Options Trading Safe?

IQ Option: Top Binary Broker

The general answer is yes when you consider the following points:

  1. It is a regulated financial instrument in the EU and many parts of the world.
  2. The risks are known and, to some extent, predictable since it’s a zero-sum forecast.
  3. There are demo trials before you put in an investment.
  4. Major binary options offer reliable customer support.
  5. The terms on deposits and withdrawals are spelled out clearly.

Binary options have attracted traders of all experience levels—from beginners to professionals—who are in a quest for diversifying their investments. This type of trading has grown to a respected and credible practice over the years. Despite this, one of the concerns of many, especially when it comes to where they put their money, is the question: is binary options trading safe?

In this article, we’ll be shedding light on the answer to this often-asked question about binary options trading to help you make an informed decision. We’ll also provide some guidelines for choosing the best platform for binary options trading and discuss factors that impact trading risk.

Is Binary Options Trading Safe Table of Contents

Binary options trading: A regulated financial instrument

After its exponential growth since 2008 and its reclassification into a financial instrument in 2020, binary options trading gained mass credibility. During that time, it experienced a surge in people searching for the term “binary options” in Google Trends, which surpassed the frequency of another related famous term “forex trading” according to Futures Mag. One of the reasons behind this increase in interest is the regulations established for this financial vehicle.

Binary options trading is a regulated product by EU jurisdictions such as CySec (Cyprus Securities and Exchange Commission) and MFSA (Malta Financial Services Authority), among others. Furthermore, regulators continue to tighten directives and mandatories. Financial Times reports on the recent actions taken by FCA (Financial Conduct Authority) to protect consumers by examining firms that may be offering binary options illegally.

Hence, if your definition of safety in the question “Is binary options trading safe?” is whether it’s regulated and legal, then yes, it is; as long as you choose the right binary options brokers (which we’ll get into later). If your concern is whether it’s risk-free, then, of course, any trading—not just binary options—entails risk. Every venture, business, and investment accompanies a calculated risk as there’s no guarantee of solid future performance.

Acknowledging risks and trading responsibly are some of the primary ways to safely approach trading. With that in mind, let’s delve deeper into answering whether binary options trading is safe in terms of its methods, platforms, and trading mechanics.

Is Binary Options Trading Safe?

Binary options are generally considered a safe investment. However, as with all money instruments, it pays to do your research to guarantee you are dealing with a legitimate provider. Here are the main reasons why this trading avenue can be one of the safest options for you.

Simple, Easy-to-understand Premise

Probably one of the most desired advantages of binary options trading that attracts many traders is its simplicity. It has a simple premise that gives you only two (thus, the term “binary”) options and outcomes. Based on your informed guess as per various factors and patterns, you’ll choose and predict the asset’s movement if it will be true at a specific point in time. It’s a straightforward “yes or no” proposition, where you’ll get a fixed percentage of your investment if you’re successful or none if you’re unsuccessful. That’s why it’s also called an asset-or-nothing option.

With binary options, traders don’t have to purchase or own an asset. Assets may be commodities (such as crude oil, silver, and gold), currencies, and stock indices, among others. With the unprecedented growth of cryptocurrencies and over 17 million Bitcoins in circulation today, some brokers also allow cryptocurrency trading. IQ Option, for instance, supports not only Bitcoin but also Ethereum, Ripple, and Litecoin.

Getting started is also easy. Traders only have to choose a broker, register an account, and immediately start trading. While being knowledgeable about this type of trade is still vital, you’re not required to have as much extensive knowledge as other types such as forex trading. With that, even beginners can work their way up and choose among different types of binary options.

There’s an option for everyone where they’re comfortable to make investments. They can opt for a simple call and put options or double no-touch binary options and vanilla options or exotic options, among others. In this way, a trader understands, based on level of knowledge and skills, how it works and avoids trading blindly. Meanwhile, more seasoned traders have the opportunity to choose more complex options where they get higher returns with bigger risks and reward paydays.

Known and Limited risk

When you trade binary options, you’re aware right up front how much you are risking and how much your potential profit will be on its outcome. You’re only risking the amount you choose, no matter how large or small it is. Additionally, there’s no risk of leverage, which means you won’t lose more than the amount you risked in the trade, unlike some other types. This way, you’re prepared for incurring potential losses as long as you choose to invest an amount that’s within your means. This prevents you from losing more than what you can afford.

It’s also an affordable way to trade online as you’re not required to trade large amounts. Depending on your chosen broker, you can trade from as low as $1. Some even give you a demo account that you can play around with to help you practice and get the hang of binary options trading before investing your real money. Our top binary options brokers let you trade from $5 to $10 as a minimum amount. It’s safe in a way that you’re not forced to lose any amount right from the get-go.

High and fast returns

When you invest, one of your goals is to get high returns. Due to binary options’ higher risk nature, its returns are also typically higher. It yields a return that amounts to an average of around 60-90%, depending on your broker. Its fast turnover rate also ensures a quick payout. Varying from different assets, the expiry times can range from a few minutes or less than an hour (sometimes even seconds) up to a few weeks. If you opt for daily binary options traders, you can trade multiple times a day for a potentially higher profit.

This gives you access to a variety of assets that are available to trade, which is an excellent way to diversify risks and control the amount of risk at a given time. If you’re successful, you can immediately see the amount added to your account. Depending on your chosen platform, you can also instantly withdraw your money. Meanwhile, if you’re unsuccessful, some brokers offer a small return based on how much you invested. For instance, you won’t lose 100% of your investment, but you’ll still get around 5-15% of it back.

Choosing A Binary Options Broker

Is binary options trading safe? As mentioned in the previous sections, it is safe as long as you’re a responsible trader. After all, there’s a difference between taking risks, which is necessary for any venture, and being risky, which is blindly being too ambitious in your trades. One of the most important and fundamental ways to reduce risks is choosing the right binary options brokers. Since it’s the platform where you’ll be doing your trading, you must check the following:

  1. Regulation. Your broker must, first and foremost, be licensed and regulated. This ensures it adheres to the guidelines of the regulatory authority or financial regulator. Since regulators pay close attention to their business practices and ensure fairness, you can assure the broker is trustworthy and transparent.
  2. Trading software. Ease of use, speed of execution, and a well-designed interface are essential as it plays a vital role in your trading endeavors. Mobile trading is also worth considering so you can trade anywhere, anytime.
  3. Demo/trial account. This is an important feature to test the software and get acquainted with it, especially for novice traders. Also, ensure it’s using real live market data.
  4. Customer support. A broker with reliable customer support that’s available in various languages and support channels, such as live chat, ticket messages, phone, and email, is important as it also shows their credibility. Some broker platforms may also offer features of customer support software for added convenience.
  5. Deposits and withdrawals. Checking a broker whose minimum deposit and withdrawal amounts you are comfortable with is crucial. Also, check if they offer convenient processes and quick timeframes, especially when it comes to the withdrawal process.

A good example of a binary options broker that includes the factors mentioned is IQ Option. It’s licensed and regulated by CySec, which guarantees its compliance with relevant regulations and jurisdictions. It has a top-notch online trading platform that offers both ease-of-use and functionality to veterans and novice traders. Newcomers can make use of a broad range of educational materials such as tutorials, webinars, e-books, and FAQ sections about the platform and binary options trading.

Binary Options: Concepts and Trading

Binary options – a popular financial tool for profit. Types of binary options, strategies and indicators for BO. How to choose the right time for the expiration of a binary option and not make the most common mistakes.

The attention of traders trading in the Forex market or on stock exchanges, recently began to attract binary options. If with traditional option contracts Since everything is pretty clear, the prefix “binary” is not completely clear to everyone. Let’s try to understand this tool and get a basic idea of ​​it.

“Binary” – what is it?

So, binary options is an option that has only two options for profitability: either a fixed percentage of profit or a loss. It is this dualism that is characterized by the name “binary”, i.e. consisting of two elements. Various instruments can act as a trading asset for a binary option: currencies, stocks, raw materials and others. The execution time of such a contract varies from a minute to several months, profitability reaches 70-95 %%. If in a nutshell to describe the principle of operation of any type of binary options, then the expression “deal-bet” is best.

Types of Binary Options

Trading binary options operates with five main types:

View 1. Binary option “Cash or nothing” / “All or nothing”

This type of binary options is the most popular among traders. At the time of purchase, he has a certain percentage of profit and price. This amount is the volume of the transaction, and it is to her that the trader risks it. Prior to the purchase of “Сash or nothing” binar, it is required to make a prediction in advance whether the selected asset will rise or fall, a Put / Put or Call / Call option is purchased (see the previous article), respectively.

If in the end, at the time of execution, the trader is right, then he receives a predetermined amount of profit, usually 70-85 %% plus the initial cost of the contract. If the forecast did not materialize, then he loses the invested amount in full. Sometimes companies make a refund when they lose in the amount of 10-15%, but this cannot be considered the rule, rather, it is just a bonus to cheer up.

View 2. Binary option “Asset or nothing” / “Asset or nothing”

The binary option “Asset or nothing” is practically no different from the above “All or nothing”. It can also be bought and sold by setting a certain level, above or below which there will be a price at the time of execution, also receive declared profits or lose the value of the contract. The difference is only in determining the profit, which is expressed in the value of the selected asset.

Which binary options are better?

Choosing binary options for trading

In fact, because profit calculation is automatic, many traders do not even see the difference between the binary options Cash or nothing and Asset or nothing.

View 3. Binary options “One touch” / “One touch”

One touch in execution and trading strategies differs significantly from the previous ones. Having all the same value and profitability, the contract also implies the existence of a certain level of asset price. Knowing him, the trader must predict whether the price reaches this mark in the allotted time period. At the same time, it does not matter at what price the contract closes, the main thing is that the asset touches a fixed level.

View 4. Binary options “No touch” / “Inviolable”

The opposite in name and meaning for the “One touch” binary option is “No touch”. The only difference is the trader’s forecast of whether the price reaches the level specified in the contract. If he believes that he will not achieve, then you should buy the “No touch” option. If at the time of closing the asset did not touch the level, the trader receives the agreed profit. Otherwise, he loses the value of the contract.

View 5. Binary options “Double one touch” and “Double no touch” / “Double one touch” and “Double touch”

These are the most complex, and therefore the least popular types of binary options. In fact, this is a modification of the “One touch” and “No touch” options – the strategy and execution are identical. However, in order to achieve profit, two fixed levels are set, to reach or not to touch which the asset must until the expiration of the exercise time of the option.

Based on your own preferences, offers from binary options brokers., as well as market conditions, it is more profitable to trade different types of binary options. Nevertheless, most traders prefer “Cash or nothing” as the most affordable and easy to understand.

Strategies and indicators for binary options trading

Binary Options Trading Strategies, if you do not go into details, are based on determining the estimated direction of movement of the asset in the terms specified by the contract, as well as the likely time to reach the specified price level. So, to get a fixed profit, you will need to indicate either the level below or above which the price will be after the time you specified, or indicate the mark near which the value of the asset will be in the near future. Your forecast options and trading strategies are closely related to the types of binary options.

Trading robots for binary options

All the pros and cons of using forex experts in binary options trading

In order to correctly predict the direction of the asset price movement and buy a binary option, most traders use forex indicators.

In fact, no special indicators for binary options not being developed. For the most part, traders use signal and arrow Forex indicators, which are adapted for trading binary options. Popular are both built-in terminal and user indicators that allow for a qualitative analysis of the asset – the direction and strength of the trend, possible pivot points, etc.

In addition, in trading binary options, trading robots have been successfully used.

How to trade binary options?

Trading binary options and trading in the Forex currency market are based on the same principles:

  • market price moves the same way;
  • with binary options the same rules of fundamental and technical analysis work;
  • money management rules are also relevant for binary options trading – it is important to determine acceptable risks and manage your capital;
  • trading strategies and forex indicators successfully work on binary options.

However, there are a number of differences that stem from the nature of binary options:

  • Unlike classical trading, Sell transactions and Buy purchases do not open. When trading binary options, only Call options (price growth is forecasted) and Put options (price reduction is forecasted) are purchased;
  • The “lifetime” of a transaction when trading binary options does not depend on the price reaching stop-loss or take-profit levels, as in Forex trading. In BO trading, a fixed option expiration time is determined, at the end of which the transaction is closed with a profit or loss;
  • accordingly, take profit and stop loss orders are not used in strategies for binary options trading.
More on binary options trading

Binary options trading – an intelligent casino for gambling traders

The minimum contract is usually $ 100. At the same time, profit reaches an average of 80%. This, of course, is not comparable with a loss in the event of an erroneous forecast, but the trader can accurately calculate the level of his losses and not exceed them if he does not want to. In addition, some brokers provide the ability to trade binary options without investments.

Quite convenient and easy to use are platforms provided by companies. Most often it is a web platform that has the required set of tools and simple forecast indicators. To some extent, this simplifies the work and it may seem that there is no need to analyze something deeply, trading binary options. In fact, this is not so. Any profitable trading requires knowledge of fundamental and technical analysis, as well as its application. Otherwise, such work turns into a casino, which is unacceptable. Therefore, for a competent approach to trading and evaluating an asset, we recommend that you analyze on your usual platform, transferring transactions to the terminal of the options broker. So, to work with binary options on currency pairs, you can use the full set of available tools of the cTrader or MetaTrader platforms, including indicators, created specifically for these contracts.

Most traders are of the opinion that trading binary options somewhat simpler than classic forex trading. Nevertheless, in trading binary options there are a number of difficulties that are associated with the choice of the expiration dates for the option, because the mistake made during the selection often leads to losses even with the analysis and correctly planned work of the trader.

Dependence of the expiration period of a binary option on the trading style

  • With long-term binary options trading (from a month or more), the process of determining the expiration date does not represent any difficulty. It is determined based on the timing of events expected in the future. It could be an expiration date. foreign exchange intervention, change in monetary policy by the Central Bank and more.
  • In medium-term trading (from a week to a month), emphasis should not be placed on fundamental economic events, but on the results of technical analysis. In this case, the best choice would be a period of two or three weeks, that is, the average life of a medium-term transaction.
  • In short-term trading (up to 1 week) it would be logical to determine the expiration period within a few days. There is one significant point – it is recommended that binary options trading be completed before Friday evening, as over the weekend some events can occur that seriously affect the market picture.
  • For intraday binary options trading, the best choice for the expiration date is the end of the trading day, since all fundamental factors have already been won back today, the market is entering a stagnation phase. When trading faster options, the guideline for the expiration dates should be the end of the trading hour.

The choice of the period for trading binary options

So what period should a novice trader choose for profitable binary options trading? Taking into account the fact that short-term options trading, as a rule, is accompanied by a lack of significant trading information, as well as a significant share of excitement, binary options are the best choice, the expiration period of which is no earlier than the end of the trading day.

To achieve more profitable and stable results when trading binary options, it makes sense for a novice trader to try medium-term and long-term trading. The use of super-short terms in binary options trading is not recommended for beginner traders, as they can lead to the formation of a gaming attitude and financial losses. The use of tick options by beginners will generally look like a game in a casino.

Dependence of signal processing time on trading tactics

Along with all of the above, it can be noted that traders often calculate how many bars an open transaction will start to work out, which also allows you to choose the expiration dates of the option. Roughly speaking, for this you need to figure out how many bars will be needed to implement the plan, multiply it by the one used timeframe and then buy the option for the resulting time.

It should be remembered that a certain trading tactic provides for different times necessary for working out a trading signal:

  • The fastest for working out a trading signal is trading by candlestick patterns – 2-3 candles.
  • Trading on the rebound from the level also implies a quick expiration time – 3-4 candles.
  • Trading binary options using breakdown certain levels require a little more time to work out the signal – up to 10 candles.
  • The longest period is trend trading, since you have to take into account a possible correction. In this case, the expiration period of the options should be chosen within 20-30 candles.
  • When trading using fundamental factors, the range of options expiration periods is very wide. For example, when trading on news, it can be several minutes, when trading on goals that the Central Bank has determined – up to a year.

The most common binary options trading errors

Any financial trading needs to be learned, one way or another, working out its strategy. We will consider the main errors and mistakes of novice traders who trade binary options. It is possible that if you take our advice more carefully, they will help you avoid some bad deals.

1. Trading binary options does not require knowledge

We have already touched upon the consideration of this error at the beginning of the article, but it will not be superfluous to repeat it. Many newcomers to trading, when dealing with binary options, find that they do not need any special knowledge in working with them – I figured out where the price would go, clicked on the button and wait. I would like to note that even the simplest initial knowledge about pricing the asset for which the option is presented will significantly reduce your losses. Not to mention the fact that, ideally, for trading binaries for currency pairs, it’s worthwhile to have a proven strategy and trading experience on Forex. One way or another, any forecasting skills should increase the profitability of your investment, reducing losses.

Bonuses for trading binary options

Binary Options: 9 bonuses to your trading account

2. Binary options – it’s almost a casino

Many players come to binary options trading like in a casino, focusing on the fact that the instrument is actually a “bet” transaction. We will not say that this is completely wrong – there is still a degree of similarity, however, some practice and knowledge in the field of analysis of exchange instruments, and luck rates turn into a well-thought-out strategy that increases the probability of winning from 50/50 to a more attractive number .

If you came into binary options trading for adrenaline and fun, then understanding the process will not reduce your pleasant emotions, but only increase it, because you will start opening deals wisely. Do you agree? Then read the first paragraph again.

3. Short-term binary options are more profitable

Yes, of course, to buy an option contract of 60 seconds and earn 75% of profit in a minute is very tempting. However, it is important to understand that making money on such short (minute, hour) intervals is not so easy, because the noise in the market can turn a profitable contract into a minus in one second. Trends over long periods are much more predictable, and therefore it is better to start with them, not to chase quick and risky profits and learn to see the market.

4. Quick transition to high rates

Quick and easy profits often give rise to euphoria among beginners of binary options trading. Having made 2-3-5-10 profitable trades in small amounts, the trader begins to think: “Why am I trifling if I can buy a contract more expensive and get more money?”. Remember, 11 trades can become unprofitable. Of course, we do not claim that this must happen, but you need to increase the contract value gradually, using about 2-5% of your total deposit. Only in this case, the profit will settle in your pockets stably.

5. Trading only one type of binary options

There are quite a lot of binary options, each of them can be used in different market situations, so you should not focus on one thing when you can use all the features of the market and binary options. It is not necessary to actively get involved in different options, but we recommend you try different options and choose the most suitable for yourself.

In general, binary options trading is characterized as more simple and understandable for beginners trading, including because it does not support the principles of margin requirements and does not require knowledge of money management. Any interested speculator can already evaluate his strength on a demo account with numerous brokers that provide this service.

Other binary options articles

FORTRADER magazine experts

FORTRADER Magazine is a large team of experts in trading in financial markets. Traders, managers, investors, programmers, testers, technical administrators – we all work for you every day for many years. Sometimes we write articles together, then the whole journal becomes the author.

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Ref. Potential Payout Contract Details Purchase Indicative
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Winning the contract

Asian options settle by comparing the last tick with the average spot over the period.

If you select “Asian Rise”, you will win the payout if the last tick is higher than the average of the ticks.

If you select “Asian Fall”, you will win the payout if the last tick is lower than the average of the ticks.

If the last tick is equal to the average of the ticks, you don’t win the payout.

Winning the contract

If you select “Matches”, you will win the payout if the last digit of the last tick is the same as your prediction.

If you select “Differs”, you will win the payout if the last digit of the last tick is not the same as your prediction.

Winning the contract

If you select “Ends Between”, you win the payout if the exit spot is strictly higher than the Low barrier AND strictly lower than the High barrier.

If you select “Ends Outside”, you win the payout if the exit spot is EITHER strictly higher than the High barrier, OR strictly lower than the Low barrier.

If the exit spot is equal to either the Low barrier or the High barrier, you don’t win the payout.

Winning the contract

If you select “Even”, you will win the payout if the last digit of the last tick is an even number (i.e., 2, 4, 6, 8, or 0).

If you select “Odd”, you will win the payout if the last digit of the last tick is an odd number (i.e., 1, 3, 5, 7, or 9).

Winning the contract

If you select “Higher”, you win the payout if the exit spot is strictly higher than the barrier.

If you select “Higher”, you win the payout if the exit spot is higher than the barrier.

If you select “Lower”, you win the payout if the exit spot is strictly lower than the barrier.

If the exit spot is equal to the barrier, you only win the payout for “Higher” contracts

If the exit spot is equal to the barrier, you don’t win the payout.

Winning the contract

If you select “Over”, you will win the payout if the last digit of the last tick is greater than your prediction.

If you select “Under”, you will win the payout if the last digit of the last tick is less than your prediction.

Winning the contract

If you select “Higher”, you win the payout if the exit spot is strictly higher than the entry spot.

If you select “Lower”, you win the payout if the exit spot is strictly lower than the entry spot.

If you select “Allow equals”, you win the payout if exit spot is higher than or equal to entry spot for “Higher”. Similarly, you win the payout if exit spot is lower than or equal to entry spot for “Lower”.

Winning the contract

You win the payout if the market price ends in the digit you have selected.

Winning the contract

You win the payout if the market price does not end in the digit you have selected.

Winning the contract

If you select “rises”, you win the payout if the market price is higher than the entry spot.

If you select “falls”, you win the payout if the market price is lower than the entry spot.

Winning the contract

If you select “Stays Between”, you win the payout if the market stays between (does not touch) either the High barrier or the Low barrier at any time during the contract period.

If you select “Goes Outside”, you win the payout if the market touches either the High barrier or the Low barrier at any time during the contract period.

Winning the contract

If you select “Rises”, you win the payout if the exit spot is strictly higher than the entry spot.

If you select “Falls”, you win the payout if the exit spot is strictly lower than the entry spot.

Winning the contract

If you select “Touches”, you win the payout if the market touches the barrier at any time during the contract period.

If you select “Does Not Touch”, you win the payout if the market never touches the barrier at any time during the contract period.

Winning the contract

If you select “rises”, you win the payout if the market price is higher than the entry spot.

If you select “falls”, you win the payout if the market price is lower than the entry spot.

Pay-out

By purchasing the “Close-Low” contract, you’ll win the multiplier times the difference between the close and low over the duration of the contract.

Pay-out

By purchasing the “High-Close” contract, you’ll win the multiplier times the difference between the high and close over the duration of the contract.

Pay-out

By purchasing the “High-Low” contract, you’ll win the multiplier times the difference between the high and low over the duration of the contract.

Winning the contract

If you select “Reset-Call”, you win the payout if the exit spot is strictly higher than either the entry spot or the spot at reset time.

If you select “Reset-Put”, you win the payout if the exit spot is strictly lower than either the entry spot or the spot at reset time.

If the exit spot is equal to the barrier or the new barrier (if a reset occurs), you don’t win the payout.

Winning the contract

Call Spread

  • Win maximum payout if the exit spot is higher than or equal to the upper barrier.
  • Win up to maximum payout if exit spot is between lower and upper barrier, in proportion to the difference between exit spot and lower barrier.
  • No payout if exit spot is below or equal to the lower barrier.

Put Spread

  • Win maximum payout if the exit spot is lower than or equal to the lower barrier.
  • Win up to maximum payout if exit spot is between lower and upper barrier, in proportion to the difference between upper barrier and exit spot.
  • No payout if exit spot is above or equal to the upper barrier.

Winning the contract

If you select “High Tick”, you win the payout if the selected tick is the highest among the next five ticks.

If you select “Low Tick”, you win the payout if the selected tick is the lowest among the next five ticks.

Winning the contract

If you select “Only Ups”, you win the payout if consecutive ticks rise successively after the entry spot.
No payout if any tick falls or is equal to any of the previous ticks.

If you select “Only Downs”, you win the payout if consecutive ticks fall successively after the entry spot.
No payout if any tick rises or is equal to any of the previous ticks.

Entry Spot

The entry spot is the first tick after the contract is processed by our servers.

The Average

The average is the average of the ticks, including the entry spot and the last tick.

Entry Spot

The entry spot is the first tick after the contract is processed by our servers.

Exit spot

The exit spot is the latest tick at or before the end time.

The end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).

The start time is when the contract is processed by our servers.

Entry Spot

The entry spot is the first tick after the contract is processed by our servers.

Exit spot

The exit spot is the latest tick at or before the end time.

The end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).

The remaining time is the time remaining until the contract expires.

The start time is when the contract is processed by our servers.

Entry Spot

The entry spot is the first tick after the contract is processed by our servers.

Entry spot

The start time is when the contract is processed by our servers and the entry spot is the next tick thereafter.
If you select a start time in the future, the start time is that which is selected and the entry spot is the price in effect at that time.

Exit spot

The exit spot is the latest tick at or before the end time.
If you select a start time of “Now”, the end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).
If you select a specific end time, the end time is the selected time.

Contract period

The contract period is the period between the next tick after the start time and the end time.

The start time is when the contract is processed by our servers.

The end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).

Contract period

The contract period is the period between the next tick after the start time and the end time.

The start time is when the contract is processed by our servers.

The end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).

High, Low and Close

The high is the highest point ever reached by the market during the contract period.

The low is the lowest point ever reached by the market during the contract period.

The close is the latest tick at or before the end time. If you selected a specific end time, the end time is the selected time.

Contract period

The contract period is the period between the first tick (after start time) and the end time.

The start time begins when the contract is processed by our servers.

The end time is the selected number of minutes/hours after the start time.

High, Low and Close

The high is the highest point ever reached by the market during the contract period.

The low is the lowest point ever reached by the market during the contract period.

The close is the latest tick at or before the end time. If you selected a specific end time, the end time is the selected time.

Contract period

The contract period is the period between the first tick (after start time) and the end time.

The start time begins when the contract is processed by our servers.

The end time is the selected number of minutes/hours after the start time.

High, Low and Close

The high is the highest point ever reached by the market during the contract period.

The low is the lowest point ever reached by the market during the contract period.

The close is the latest tick at or before the end time. If you selected a specific end time, the end time is the selected time.

Contract period

The contract period is the period between the first tick (after start time) and the end time.

The start time begins when the contract is processed by our servers.

The end time is the selected number of minutes/hours after the start time.

Reset Time

At reset time, if the spot is in the opposite direction of your prediction, the barrier is reset to that spot.

The exit spot is the latest tick at or before the end time.

The end time is the selected number of minutes/hours after the start time.

The start time is when the contract is processed by our servers.

The entry spot is the first tick after the contract is processed by our servers.

Entry spot

The start time is when the contract is processed by our servers and the entry spot is the next tick thereafter.

Exit spot

The exit spot is the latest tick at or before the end time.
The end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).
If you select a specific end time, the end time is the selected time.

Entry Spot

The entry spot is the first tick after the contract is processed by our servers.

Entry spot

The start time is when the contract has been processed by our servers.

The entry spot is the next tick after the start time.

Exit Spot

The exit spot is the last tick when the contract ends. Contract ends when all ticks rise or fall successively, or when a single tick breaks the predicted pattern.

Contract duration

Please refer to the asset index for each asset’s minimum and maximum contract durations based on trade type.

Contract duration

Please refer to the asset index for each asset’s minimum and maximum contract durations based on trade type.

Contract duration

Please refer to the asset index for each asset’s minimum and maximum contract durations based on trade type.

Contract duration

Please refer to the asset index for each asset’s minimum and maximum contract durations based on trade type.

Note: Asian contracts will be refunded at the purchase price if the contract doesn’t end within 5 minutes.

Note: Digit contracts will be refunded at the purchase price if the contract doesn’t end within 5 minutes.

Note: Ends Between/Ends Outside contracts will be refunded at the purchase price if there are less than 2 ticks between the start and end times.

Note: Even/Odd contracts will be refunded at the purchase price if the contract doesn’t end within 5 minutes.

Note: Higher/Lower contracts will be refunded at the purchase price if there are less than 2 ticks between the start and end times.

Note: Over/Under contracts will be refunded at the purchase price if the contract doesn’t end within 5 minutes.

Note: Rise/Fall contracts will be refunded if:
• There are less than 2 ticks between the start and end times
• The contract doesn’t end within 5 minutes (for tick duration contracts)

Note: Stays Between/Goes Outside Contracts will be refunded at the purchase price if there are less than 2 ticks between the start and end times.

Note: Touch/No Touch contracts will be refunded at the purchase price if there are less than 2 ticks between the start and end times.

Note: High Tick/Low Tick contracts have a strict duration of five ticks.

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In the EU, financial products are offered by Binary Investments (Europe) Ltd., W Business Centre, Level 3, Triq Dun Karm, Birkirkara, BKR 9033, Malta, regulated as a Category 3 Investment Services provider by the Malta Financial Services Authority (licence no. IS/70156).

Outside the EU, financial products are offered by Binary (SVG) LLC, Hinds Building, Kingstown, St. Vincent and the Grenadines; Binary (V) Ltd, Govant Building, Port Vila, PO Box 1276, Vanuatu, regulated by the Vanuatu Financial Services Commission (view licence); Binary (BVI) Ltd, Kingston Chambers, P.O. Box 173, Road Town, Tortola, British Virgin Islands, regulated by the British Virgin Islands Financial Services Commission (licence no. SIBA/L/18/1114); and Binary (FX) Ltd., Lot No. F16, First Floor, Paragon Labuan, Jalan Tun Mustapha, 87000 Labuan, Malaysia, regulated by the Labuan Financial Services Authority to carry on a money-broking business (licence no. MB/18/0024).

This website’s services are not made available in certain countries such as the USA, Canada, Hong Kong, Japan, or to persons under age 18.

The products offered via this website include binary options, contracts for difference (“CFDs”) and other complex derivatives. Trading binary options may not be suitable for everyone. Trading CFDs carries a high level of risk since leverage can work both to your advantage and disadvantage. As a result, the products offered on this website may not be suitable for all investors because of the risk of losing all of your invested capital. You should never invest money that you cannot afford to lose, and never trade with borrowed money. Before trading in the complex products offered, please be sure to understand the risks involved and learn about Responsible Trading.

In the EU, financial products are offered by Binary Investments (Europe) Ltd., W Business Centre, Level 3, Triq Dun Karm, Birkirkara, BKR 9033, Malta, licensed and regulated as a Category 3 Investment Services provider by the Malta Financial Services Authority (licence no. IS/70156).

In the Isle of Man and the UK, Synthetic Indices are offered by Binary (IOM) Ltd., First Floor, Millennium House, Victoria Road, Douglas, IM2 4RW, Isle of Man, British Isles; licensed and regulated respectively by (1) the Gambling Supervision Commission in the Isle of Man (current licence issued on 31 August 2020) and by (2) the Gambling Commission in the UK (licence reference no: 39172).

In the rest of the EU, Synthetic Indices are offered by Binary (Europe) Ltd., W Business Centre, Level 3, Triq Dun Karm, Birkirkara, BKR 9033, Malta; licensed and regulated by (1) the Malta Gaming Authority in Malta (licence no. MGA/B2C/102/2000 issued on 01 August 2020), for UK clients by (2) the UK Gambling Commission (licence reference no: 39495), and for Irish clients by (3) the Revenue Commissioners in Ireland (Remote Bookmaker’s Licence no. 1010285 issued on 1 July 2020). View complete Regulatory Information.

Binary.com is an award-winning online trading provider that helps its clients to trade on financial markets through binary options and CFDs. Trading binary options and CFDs on Synthetic Indices is classified as a gambling activity. Remember that gambling can be addictive – please play responsibly. Learn more about Responsible Trading. Some products are not available in all countries. This website’s services are not made available in certain countries such as the USA, Canada, Hong Kong, or to persons under age 18.

Trading binary options may not be suitable for everyone, so please ensure that you fully understand the risks involved. Your losses can exceed your initial deposit and you do not own or have any interest in the underlying asset.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with Binary Investments (Europe) Ltd. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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