Many people begin to trade in binary options with no real plan for the long term. Instead, they are looking for more immediate results. While this is understandable, a good strategy should also consider the distant future. Trading successfully over the long haul is going to require some education, good money management and solid strategies. Now, let’s consider how sustainable trading can be over a period of months and years.
Anyone who hopes to trade in the long term should set goals for themselves, for example, learning to perfect analysis. The fundamental, as well as technical analysis, should continue to be important when trading. You will need to plan on learning the different aspects of trading, such as using data and news reports to continue to see profitable returns while reducing the inherent risk. You needn’t learn everything all at once, but you should determine in what order you will need to learn the different aspects of trading. A commitment to learning and advancing in skills should be in place.
Learning better money management skill should be a priority for all traders. It’s necessary if you want to stay profitable by making the best investments in the correct amounts. New traders may find themselves needing to make more deposits than they had hoped to, just because they lack good money management skills. The best advice they can be given is to limit their investment amounts until these skills become stronger. One widely used method is to never investment more than 5% of total account funds on any single trade.
New strategies should also be a part of your plan. If an approach is found to be effective, then it can be used many times as you wish. However, it’s advisable to continue to look for and develop new ones whenever possible. Learning new strategies doesn’t have to carry a financial risk. Still, if you hope to add new underlying assets as well as trade types, then new strategies will become necessary. Always test each method on paper on within a demo platform before using them.
A continued commitment to learning how to best judge risk also has a place in your long-term plan. All binary options traders need to understand risk if they wish to be successful. Deciding when to select a Put or Call option at both the appropriate time and at the right level of risk is going to require that you have some knowledge of risk assessment. There will be times when a higher than usual amount of risk is desirable. While on other occasions, you may have doubts about investing a significant amount in an underlying asset that has proven volatile.
The last consideration for long-term sustainable trading is fee management. Most brokers won’t charge a fee if you trade within their platform. You are more likely to see costs due to withdrawals though. Many brokers will charge a fee if more than one withdrawal is made within a month, while some assess these fees only with certain withdrawal methods. Withdrawal fees should be listed somewhere on the broker website, but if not, a customer service representative should be able to tell you what these costs are.
The act of trading should be entered into with the idea that there will be plans needed for both the immediate and the long-term. Planning ahead will help you get off to a good start. That start will lead you to better trading as time goes on. There are plenty of helpful resources available, so do make use of these as you proceed through your binary options trading career.
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