In present day, binary options are rapidly growing in popularity within the ever-changing investment industry. This is due to the many advantages of binary options in comparison with other, more traditional, investment options. Binary options offer a pre-ordained disbursement and damage format in addition to presenting investors with the convenience of creating vast trading positions in primitive assets using a limited cash deposit. Trading preferences could not be any simpler as users only have to decide in which path to maneuver their fundamental equity (ie: up or down).
For US residents, Nadex is by far the best trading service available. Unlike other offshore brokers, Nadex offers trading via an exchange and is the only broker that is licensed in the United States. Apart from its activities being monitored, being licensed ensures that traders will always have legal recourse in case anything goes wrong. And by offering binary options trading through an exchange, Nadex allows traders to trade against each other; there must be a seller for every buyer. This way, there is absolutely no vested interest (on the part of the broker) and traders do not have to worry that the broker is on the other side of their trade.
Traders have better control of trades in binaries. For example, if a trader wants to buy a contract, he knows in advance, what he stands to gain and what he will lose if the trade is out-of-the-money. This is not the case with other markets. For example, when a trader sets a pending order in the forex market to trade a high-impact news event, there is no assurance that his trade will be filled at the entry price or that a losing trade will be closed out at the exit stop loss.
The payouts per trade are usually higher in binaries than with other forms of trading. Some brokers offer payouts of up to 80% on a trade. This is achievable without jeopardising the account. In other markets, such payouts can only occur if a trader disregards all rules of money management and exposes a large amount of trading capital to the market, hoping for one big payout (which never occurs in most cases).
So, when news came out that the UK was leaving, I made more money that day by forecasting what assets/stocks would go up and down then I have done in months. Some of you will be thinking, ‘how much did you make?’ I’m not going to mention here specific numbers, but let’s just say that most people will have to work a year to make what I did in just one day. STOP LOOKING FOR A MIRACLE AND INSTEAD THINK AHEAD AND MOVE SMART!
As banking is perhaps the most crucial factor as it is the most used feature in binary options trading, it is imperative that there is a decent selection of deposit and withdrawal options available for clients. For deposits, Option Financial Markets offers a variety of choices including credit cards, multiple eWallets and bank wire. Funds are readily available in the trader’s account balance most often within minutes of the deposit, which allows them access immediate trading. Personal information is guaranteed utmost security thanks to communication via SSL technology. Users are always able to contact OFM support at any time if they need assistance with their financial dealings.
The minimum required deposit for Banc de Binary is $250 which can be made via Bank Wire, Skrill (MoneyBookers) and Credit/Debit Card. The payments from Banc de Binary to the customer will be applied to the same source from which they originated (i.e.: if you made your deposit via credit card, your withdrawal will be applied to the same credit card).
The minimum deposit amount is $250 and the minimum investment amount is $24. Trade types offered are high/low, one touch and no touch, boundary, and 60 seconds. A demo account is offered for new traders. You can enroll in Standard, Gold, or Platinum account depending on the amount you deposit and the features you want. 24Option provides customer support via phone, live chat, and email in English and thirteen other languages.
This should be really easy, and in many cases, it truly is. But this doesn’t mean that people don’t get hung up at this part. Your actual trading might be the easiest part of all of this, though. It also happens to be the most important part. Even with a great broker, awesome rates, and perfect option choices to choose from, an unskilled trader will lose money.
For example, a customer may be asked to pay $50 for a binary option contract that promises a 50% return if the stock price of XYZ company is above $5 per share when the option expires. Assuming a 50/50 chance of winning, the payout structure has been designed in such a way that the expected return on investment is actually negative, resulting in a net loss to the customer. This is because the consequence if the option expires out of the money (approximately a 100% loss) significantly outweighs the payout if the option expires in the money (approximately a 50% gain). In this example, an investor could expect -- on average -- to lose money.
But with any high-growth market comes challenges. For example, choosing the right broker or platform is key. As with any new instrument and industry, binary options have a “wild west” aspect. Many firms that offer these platforms are licensed offshore and fall outside the stricter regulatory umbrella and standards that are common in the United States, Europe and Australia. As a result, some firms use questionable marketing tactics designed to lure customers with give-aways, such as iPhones and flat-screen TVs. The reality is most customers lose their money, and lose it quickly with these schemes.
Binary options can involve the trading and hedging strategies used in trading traditional options. You should always conduct a market analysis prior to each trade. There are many variables to consider when trying to decide whether the price of a stock or other asset is going to increase or decrease within a specific time period. Without analysis, the risk of losing money increases substantially.
The binary options trader buys a call when bullish on a stock, index, commodity or currency pair, or a put on those instruments when bearish. For a call to make money, the market must trade above the strike price at the expiration time. For a put to make money, the market must trade below the strike price at the expiration time. The strike price, expiration date, payout and risk are disclosed by the broker when the trade is first established. For most high-low binary options traded outside the U.S., the strike price is the current price or rate of the underlying financial product. Therefore, the trader is wagering whether the price on the expiration date will be higher or lower than the current price. (For more, see What is the history of binary options?)