If you are looking for new investment opportunities and feel you have a great intuition of the cycles the market makes, binary options might be for you. Binary options allow you to bet money on a specific asset or market moves within a set time perimeter. Binary options have a reputation of being more gambling than investment, but with the right strategy you will be able to turn regular profits.
So, what are Binary options?
Lest start with the word binary which means ‘one or the other’, in the context of binary options it means you are trying to predict and outcome that is either one thing or the other. A normal binary option would be predicting if a certain asset rise or drop in price over the next 2 hours. Sometimes binary options are also referred to as ‘yes or no’ investing. If you think an asset is on the rise you will be predicting “yes” and buy options and the other way around you will bet ‘no’ and sell options.
Usually it does not cost a lot to participate in the binary options game, most brokers offers very low entrance fees. Most contracts are relatively cheap, and you can find a decent trade with a buying of max $100. It is important to understand you are not buying the underlying asset or anything like that, all you are doing is betting on the assets price movements, and you either win or lose.
This is the variation of binary options that people associate with gambling, and it is generally advised to stay away from strategies that build on simple predictions like that. But if you have a bunch of cash that are burning a hole in your pocket, and you want to get a little training for options trading, binary options could be the way to go.
The assets available for trading will depend on with broker. And this is an important part of trading binary options, you broker. The binary option market is full of scams, so when choosing you broker, make sure it is licensed and regulated. The most normal assets to trade are stocks, Currency pairs, company stocks or commodities like metals, energy and produce.
If you want to start trading binary options, as mentioned above you need to find a broker and i will repeat the importance of checking up on the broker you choose and make sure they are regulated. Most brokers offer a trail period where you can try and trade with fake virtual money to get a feel of what this kind of trading is. It is advised to use that period and try to develop a strategy which works, before moving into the real money game. Gather information on whatever market you are trading in and use all the technical tools you can get your hands on to secure you make decisions on the best information available. Lastly, keep track of your trades, take notes and good luck.