Basics of Binary Options and How to Trade Them

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A binary option is an extremely simple and fast financial instrument that allows investors to gamble on the cost of any asset going down or up in the future. For example, the price of Google stock, the USD/GBP exchange rate, the price of Bitcoin, or the price for gold. The span of time can be as little as one minutes, making it conceivable to made hundreds of trades per day across any global market.

Before trading

Before anyone places a binary option trade they know precisely how much they stand to gain if their prediction is correct, usually 70% to 95% – an example, if one invest $100 you will accept a credit of $170 to $195 with a trade that is successful. This takes risk management and decisions on trading very simple. The outcome is always Yes or No answer – you will either win it all or you lose it all – therefore the name “binary” option. The reward and risk are known in advance and this structured payoff is why these are so attractive.

Exchange traded

Trading binaries on exchanges are currently available, withtraders not trading against the broker. To begin trading you need first a broker account that is regulate or have a licensed account. You can choose one from the list of recommended brokers where just brokers that are known to be trustworthy are listed. The top broker has been designated as the best choice of most traders.

New to options

If you are totally new to trading binary options, you maystart a demo account with many brokers; to try out their platform and see how it feels when trading before you deposit any real money.

Videos

There are videos that were introducing a new trader to the concept of binary options as well as how trading is done. If you want more details, there are plenty of papers and articles on the internet that have in-depth details. Binary trading does not need to be complicated, but just as almost any topic you should educate yourself to be an expert as well as has skills that are perfect.