Many who trade binary options have no idea of the extent to which emotions control investment decisions. Far too often, emotions cause poor decisions which can lead to losses. They can also lead to limitations in overall profitability. By learning which emotions are most problematic and how to recognize their influence in advance, traders can […]
Best Reasons to Trade Binary Options
Trading binary options is a high risk/high reward type of trading, but with the proper amount of precaution, you can learn how to make money in this marketplace, even when the general economy is going through a rough spot. There are many reasons why you could incorporate binary trading into your portfolio. Below are listed a few of the bigger benefits that you might find within this type of trading.
The Big Returns
One of the biggest benefits is that you can get big percentage returns with each profitable trade. Many brokers will give up to 85 percent returns on your investment when your predictions are correct.* This is something that stock traders can typically only dream of. In the world of stock trading, a return of 10 percent on your trade is considered extremely good. Binaries obviously have the potential to go way above and beyond this number on a single trade.
*Amount credited to your account with a successful trade.
Simple to Use and Learn
They are simple to understand. There are only two things that can happen—you can be right or wrong. The price of the asset in question can go up or down. You will either earn a return or lose everything. There is no middle ground when you are trading these assets. Of course, this carries a certain amount of risk with it; there is no room for small losses. Still, the simplicity has attracted quite a following. Just as there are no small losses, there are no small gains, either, and this is something that traders can use to their advantage. But beware. Just because these are easy to understand does not mean that they are quick money. Despite the simplicity, binary options trading is very difficult at times.
A Very Quick Method
A typical binary option will usually last less than an hour and you will see your profits deposited into your account immediately after it expires. If you are looking for something fast paced so that you can see profits on a “right now” basis, then you are in the right place. Whereas a Forex trade might take you a few hours to go in the right direction, you will seldom have a position open for more than 30 minutes with binaries. And now that there are many sites that offer 60 second binary options on their platform, you can literally make hundreds of trades over the course of a day or two if you wished.
You Can Customize
One of the big appeal traders see is that they can customize their trading to meet their individual needs. There are the simple call and put that you can use with various expiration times, but there are also one touch and boundary options that you can use if you have that specific set of ideas. A one touch option is profitable if the asset reaches a certain price at any point during the life of the trade. A boundary trade is profitable if the price finishes up within a certain price range at the time of expiration.
There are also exotics that will give you returns of 200, 350, or even 500 percent with some brokers. These options are generally one touch options that have a far off price goal. These might be extremely hard to be profitable with, but during times of extreme volatility, you can use these types of options to your advantage to make huge profits.
More Access then other Industries
They take assets from many different unrelated marketplaces and condense them all together into a single website where you can trade everything you might wish to without changing sites or using different software programs. They combine stocks and indices, the major currency pairs, and all of the most popular commodities and put them all in the same place. Before, you would have to go to different places to trade stocks and currencies. Binary options brokers are able to do this because you never really need to worry about the ownership of a specific asset. Instead, these assets are referred to as underlying assets. Instead of buying and selling the asset, a more accurate way to describe them would be to see you are only making a prediction on which direction you think the asset will move in.
***Your capital may be at risk. This material is not investment advice.***