Archive for the ‘Binary School’ Category

Binary Option Trading Has an Edge over Forex Trading

Sunday, September 5th, 2010

Traders who trade in stock market are finding it very easy and interesting to trade in Binary options. Investors have gone crazy for binary options as there are not trading costs, profits are huge and the duration to realize such high profits is short. People who have designed binary trading have fulfilled all the wishes of the traders!

The way the craze for Binary trade is going, it is leading all the investors to those brokers who provide platform to trade in Binary options. The scope of Binary options includes trading stocks, Forex trade, indices and even commodity markets. So, investors get opportunity to trade in all famous stocks like Google, Microsoft etc. and at the same time they can also trade in most traded pairs like USD/YEN, GBP/USD etc. In this way, the investors get opportunity to broaden their portfolio and thus spread the risk involved.

There is one nice feature regarding trading in Binary option is that it is just like trading in Mutual funds where the trading is done in terms of dollars and not in number of shares. This makes the trading easy for the investors as they can decide as to how much they can invest in Binary option trading. The complex number crunching is also not required as there is no calculation of any brokerage to be done. If an investor is investing hundred dollars, then he is investing the entire hundred dollars and not paying any portion towards any expenses to get the trade done. It is entire-money investing.

The other best part about trading Binary options is that you can start your investment even by hundred dollars and start earning profits which is a very small amount if you were to trade in the traditional trading as the profits would then be negligible. The other important thing that should not be forgotten is that there is no commission and so entire profit earned is of the investor.

Trading in Forex market carries a high amount of risk with it. The loss or profit is not decided at the start of the trade. Hence there is a chance of very high loss. The profit or loss depends directly on the magnitude of change in the currency pair’s exchange rate. This is not the case with Binary option trading as the profit or loss is predetermined. So, the investor can invest his money accordingly. There are no chances of any surprises. Trading in Forex market involves brokerages and commissions. This leads to an increase in loss as the burden of the commission also has to bourn by the investor along with that of loss. The capital required to make good profits is less in binary option trading and so even a small investor can also trade in financial markets. On the other hand, a small investment doesn’t lead to sufficient profits in Forex market as it needs huge capital for better profits.

Due to its simplicity and limited risks, Binary option trading certainly has an edge over Forex trading.

Why Choose Binary Options for Trading?

Sunday, September 5th, 2010

A Binary option is a great investment option which is also very simple to understand. Although this is one of the main reasons because of which more and more people are rushing to open a trading account with binary option broker, there are other several benefits of binary trading. Following are some of the main reasons why binary option trading is gaining such popularity.

Benefits

The broker, who provides facility for Binary option trading, doesn’t charge you a commission.

The returns provided by the binary trading are the highest as compared to any other short term fixed investment instrument.

The expiry period for the binary option trading can be as short as one hour and so the investor can have many trading sessions and earn great profits by rolling the same capital

Binary option contracts are available in all the financial products including stocks, forex pairs, securities and indices. The best thing about Binary options is that it is available only in well known stocks, indices and most traded Forex pairs.

The risk is limited to the amount that is invested by the investor and the loss can not exceed that amount.

Hard to believe that it is very simple!

Many people wonder that whether trading in binary options is really that simple? As an investor you have to make two decisions while trading. The first one is to decide as to in which direction will the price of the asset will move and how much amount you should invest in that trade. Earlier trading in the financial markets was a pain taking effort as the investor had to invest a large capital, spend hours in doing research and analysis, pay sky high commissions and brokerage and wait for month or even years to reap the fruit of his investment. But with the introduction of Binary option, things have changed for the better. The investor can start with small investment and earn profit over a short period of time. At the same time, the trader doesn’t have to take a judgment of the magnitude of the price movement which is very difficult. He only has to decide the direction of the price movement and that is comparatively easier.

Trading is simple when…

  • There is no brokerage or commissions to be paid
  • No complex number crunching
  • Just decide whether ‘Up’ or ‘Down’
  • Profits are realized quickly
  • Decide the capital to be invested

Binary option trading encompasses all these factors and so it is very simple to trade in. Because of all these reasons it has become center of trade for most of the traders.

There are risks involved in any trade which is carried out in financial markets. However, as compared to traditional trading which carries unlimited risks with itself, the risk is limited when it comes to binary option trading. This is one of the strong points that differentiate Binary option trading from traditional trading.

What are Binary Options?

Sunday, September 5th, 2010

Binary options trading have become highly popular method of trading in the world of financial market. Binary options trading are best for trading goods, such as metals, natural gas, and petroleum because they give the investors good returns. Commodities come under the asset class and the market in commodities reacts in a very volatile manner as they can be traded on hourly basis. Because of flexible nature, trading goods can create brilliant opportunities to make enormous money.

Those, who are experienced and are able to bear the loss, binary options can prove a better way of trading for them. Binary options are relatively safe and offer the investor an opportunity for rational investment. As they are simple to understand, both novice and experienced traders are getting attracted to them. Although, it does not require any knowledge about the financial market in depth, one should get acquainted with the way binaries work before one invests in them. Every person, while investing with binary options, must know that there are only two possible results that binary offers. Due to this reason these options are known as ‘binary options’. The trader will either get a predetermined payout or just nothing. However, it is the trader who has full control over his investments and the risk involved.

The average benefit, a trader gets with investing in binary options, is about 60% to 75% of the invested money. The chances of getting the payout are very quick and a small investment can turn in a fortune. When the market is highly volatile, and the situation is somewhat unstable due to some economic report to be published, binaries can prove quite profitable. Binary options have three main factors and they are 1) the security, 2) the expiration period, and 3) the direction in which the security moves.

In binary option the asset on which the trading is done is known as security. It can be anything such as stocks, commodities, indices, currencies and goods among others. No buying of assets in binary options and for this reason there is strike price of the security which is determined at the onset of the option. Once the deal is over, the trader may gain profit if his expectations about the price movement are met. He can get a loss if his anticipation about the movement goes wrong. These results are termed as ‘in the money’ and ‘out of the money’ in the financial market.

The deal gets over at as soon as the expiration time of the option comes to an end or you can say it is the time when the option matures. This expiration period can be from one hour to one month.

The trend in the market can tell an experienced trader in which direction the price cam move. It can be either up or down. If the market goes upwards, it is referred as a call option and if it goes downwards, it is known as a put option. The flexible nature of binary options gives the trader a chance to change his mind about the direction and minimize his loss.

All You Need to Know About Binary Options

Sunday, September 5th, 2010

Binary options are becoming popular because of their simplicity and flexibility. This easy way of trading has got over the traditional trading and has become favorite method of trading with the investors all over the world. Knowing about binary options is not very difficult. There are two type of options and only two possible outcomes of the binaries. As the word binary only tells about the nature of the options, one has to get contented with the two types of binaries that are a call option and another being the put option. A call option refers to the rise in the price and a put option is bought if you think that price of a certain asset will go down. If your estimation in both the conditions is right, you will get the profit.

Trading Binary Options

As it has been referred above, binary options are not very difficult concept to understand. If you think that the value of a certain security will increase before its expiry time, you should go for ‘a call’ option. If you anticipate that the price will fall, you can choose ‘a put’ option. Since binary options give only 100 or nothing result, your potential profit and loss is known to you in advance.

For example, if you put $50 at stake, then your maximum loss will be $50 only if the option settles at 0. If the option settles at $100, you receive $44 as your profit according to the contract. This can happen when you buy a call option. On the contrary, your maximum loss is $50 if the option settles at $100 which means a risk of $50. You will get a profit of $50 if the option settles at 0.

Those, who trade in binary options, know what can be the potential loss and are never told to fund the extra margins. This is also one of the reasons that binary options are thought to be the safest trading method. The return on the investment is fixed that you already know at the onset of the contract but it depends on what type of asset you are trading. if your call option expires with a high price compared to the price you invested on the option, you will receive a payout that you already knew. If your call option ends below the purchased price, your broker may return you back 10% to 15% of the money you had invested.

There are four time frames that binary options work on. They are traded on hourly basis, daily, weekly or monthly basis. You can place a bet on any type of option and earn enormous profit. A number of options can be bought at the same time and also you may place your bet on the same assets or different assets. The experienced traders in the line like to but a number of options in different markets and stock to earn unlimited profits simultaneously. The only thing required to get profit with binary is the full knowledge of the trade. It is important to enhance your knowledge to enhance your profits.