How To Trade Binary Options Successfully and Profitably

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Top Binary Options Broker 2020!
    Best Choice For Beginners!
    Big Sign-Up Bonus!
    Free Trading Education!
    Free Demo Account!

  • Binomo
    Binomo

    Only For Experienced Traders!

Learn How To Trade Binary Options Successfully And Profitably

How to trade binary options, is a question frequently asked by beginners including our readers. So, we aim to give you a proper solution through this article.

Binary options are popular because of its simple trading nature, with a fixed return percentage. Despite its simplistic nature, many traders use on their binary trades far more often than you think.

It boils down to reasons such as lack of trading knowledge, experience, or choosing the wrong broker. Whatever the reason may be there must be a clear plan ahead of trading, so you don’t face ill-consequences in your trading result.

Before enlightening you with the step by step guideline on how to trade binary options profitably, we will give a short brief on what binary options are.

What Are Binary Options?

We are going to explain a basic concept on binary options here, but for detailed information, read what is binary options trading article.

Binary Option is an investment type where you have two outcomes, all or nothing. It has also a fixed expiration.

You have to accurately predict the outcome with an expiry time to make a profit. Either you will win a trade or lose all the money that you have invested for a particular trade. Moreover, you can perform binary trade in two ways.

  • Manual Trading
  • Automated Trading

In manual trading, you do all the hard-work and place the trades yourself using trading strategies . But in auto-trading, automated trading software does the trading for you, using a build-in trading strategy.

Which method you use for trading depends entirely on your preference. If you are a new trader, you might take help from a trading robot in exchange for a price. Or you can learn the basics of trading, and do it yourself.

Binary Trading Example

You already know through our citation that binary options give you a fixed payout and loss amount. To power-up your trading journey, you must have to follow some rules.

Before jumping to those specific points, we will try to connect your existing knowledge with a small example.

James Chen from Investopedia explains binary options trade with the help of an example.

Assume stock XYZ is currently trading at $64.75. A binary option has a strike price of $65 and expires tomorrow at noon. The trader can buy the option for $40. If the price of XYZ finishes above $65, the option expires in the money and is worth $100. The trader makes $60 ($100 – $40).

If the option expires and the price of the stock is below $65, the trader loses the $40 they put into the option. The potential profit and loss, combined, always equals $100.

5 NoteWorthy Steps To Trade Binary Options

What you are expecting from this phase?

Hang on! Let me guess. Maybe, you might think that we will share with you a spell so that you can earn a lot of money. But, the section will focus on the 5 noteworthy steps on how to trade binary options.

  • Choose a regulated broker
  • Analyze the market and asset
  • Practice on a demo account
  • Make an initial deposit
  • Start Live trading

As each step is very powerful, so our recommendation is to read each step without skipping.

# Choose A Broker

Choosing a broker without evaluating some factors can bring disaster. On the other hand, the retail investment market is large and have a lot of scopes. According to a report of SEC,

approximately 7,600 investment advisers registered with the SEC that serve retail investors, with over $12 trillion in retail client assets under management, and approximately 34 million clients.

Isn’t it crazy!

The actual craziest thing is that one has to choose one or more than one broker from thousands. Here, we will mention some factors that you should keep on mind before selecting any broker.

  • Regulation
  • Demo account
  • Minimum initial deposit
  • Ease of use
  • Variety of assets
  • High Payout percentage
  • Fast withdrawals
  • Multiple modes of payment

In addition to that, you refer to our list of binary options broker . It’s not necessary that you have to stick to one broker. No broker is perfect, and one broker may not suit all your needs. Don’t hesitate to trade with multiple brokers.

Taking all the above factors into consideration, we have prepared our list of recommended brokers that you can trade with.

These brokers meet all the requirements such as regulation, offering a demo account, huge asset index, high payouts, fast withdrawals, easy-to-use trading platform, and much more. Here is the list of brokers Binary.com , IQ Option, and BinaryCent that we think will offer you the best binary options trading experience.

Binary.com

IQ Option

BinaryCent

# Analyze The Market & Asset

The trading market is unpredictable and changes every sec. Three main types of analysis bring an optimal trading result.

  • Fundamental Analysis
  • Technical Analysis
  • Sentimental Analysis

Here, an economic calendar works as a ground from where traders use data to forecast the market movement. As there is “no” best method of analysis, so you have to pick the most viable option depending on time-frame and asset information.

# Practice On A Demo Account

Registering an account is free of charge with most brokers. All it takes is your vital information such as an email address, your first, and last name. Once you have created an account, you need to practice trading through a demo account.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Top Binary Options Broker 2020!
    Best Choice For Beginners!
    Big Sign-Up Bonus!
    Free Trading Education!
    Free Demo Account!

  • Binomo
    Binomo

    Only For Experienced Traders!

Train yourself with the help of a demo account until you create an unbeaten situation. Educate yourself on the basic concepts of binary trading. Understand what strike price, expiry time, call, and put option, etc. Familiarize yourself with the different ways you can trade binary options.

Just because the funds and the outcome in demo accounts don’t hold any real meaning, it doesn’t mean you should trade recklessly.

Trade on the demo account exactly how you would live trade. This practice will develop your trading skills and build valuable experience.

There is no fixed duration on how long you have to practice on a demo account. Take as long as you need. Finally, when you feel confident enough, you can step up to real trading.

# Make An Initial Deposit

The initial deposit amount varies from broker to broker. You need to deposit on the trading account to carry out live trading. On the other hand, there is a big difference between an investment and deposit.

An investment is a price what you pay to get the future value. Meanwhile, the deposit is a certain amount of money that one needs to open an account.

It is wise to start with a small deposit amount like $10 to $20.

# Start Live Trading

You can start trading on a real account once you are familiar with the ins and out of binary trading. Select your preferred asset and choose your investment amount. Depending on your prediction, buy a call or put option.

Place your trade, and wait until your trade expires. In the next section, we have listed some tips and techniques on binary trading to make your trading successful and profitable.

How To Trade Binary Options Successfully And Profitably – Best Way To Trade

We already discussed a few steps above. Those steps are the principle that one trader should follow whether he is professional or not. After that, you need to turn your binary options trading into a successful profit machine.

Don’t miss out the chance by skipping points that we covered below. Follow these tips to ensure you don’t lose money while trading binary options.

  • Choice of assets
  • Start trading with small
  • Eliminate emotions from trading
  • Choose the right expiry time
  • Follow the market news
  • Risk management
  • Knowledge is power

Choice Of Assets

As you can trade with a large number of assets, so trade those assets that you are most familiar with. Do not take unnecessary risks by trading in markets that you cannot predict.

Successful binary trading depends on how well you can predict the market. Follow the market news before executing trades. Diversification of your portfolio is one way of reducing your overall trading risk. But it doesn’t mean you should diversify to assets that may not be profitable to you.

Stat Trading With Small

You may have heard about the risk management where you have stick on either 1% or 2% rule. It is a general rule of thumb for traders.

90% of traders failed in trading because they have lack of knowledge on money management. Investing a huge amount of money will not help you to increase profits.

So, at first, start with a small amount like $10. After gaining valuable experience, you can start increasing your trade size. No matter how much you practice on a demo account, trading on a live account is a different scenario. As there is real emotion involved, which brings us to our next point.

Eliminate Emotions From Trading

Professional traders are not super-human. They also fight to control their trading emotions. Eventually, all traders must go through a cycle of market emotions.

Controlling emotions is not sky-rocket. However, you will find a difference in gratitude of a winning trader and a losing trader. No wonder, a low expectation level can save you from a massive failure.

Stop dreaming about to get rich quick and follow the 7 secrets that will help you to improve your trading emotions or psychology.

Choose The Right Expiry Time

It is may seem like a matter of preference or a trivial issue, but even expiry time is a crucial factor when it comes to binary options trading.

For example, a trend was supposed to reverse within an hour. But if you placed a trade with 2-hours expiry, the trend would have reversed by then. And, you had lost the trade.

Follow The Market News

Whatever underlying asset you may trade, you need to be informed on the latest global events, and news associated with that asset. Many traders build strategy depending on the market news. So don’t skip on that, and act accordingly.

For example, if there is negative news regarding the gold and a price drop is imminent, log in to your binary options trading platform, and open a put position on gold.

Reacting appropriately to market news can bring in more trading success than you think.

Risk Management (Hedging)

Unless you are a pure gambler looking for absolute results, you should make use of hedging. Hedging is a money management strategy used to protect your profits. In this way, if you are wrong on your prediction, you lose money from your call option, but you regain that back from the put option.

Protecting your investment by buying a binary option contract opposite to your initial contract is hedging. Hedging may reduce your overall profit potential, but it also protects your capital.

If you quite confident about your prediction but still want to hedge, invest the lesser amount in the hedge position compared to your main position.

Knowledge Is Power

Trading education is one of the big factors that play a vital role in success. You need to constantly educate yourself with trading knowledge. Even though binary options look easy and simple, there is a lot that goes into constantly turning your trades into a profitable one.

Moreover, you are less likely to commit mistakes and perform better trading analysis when you are equipped with trading knowledge.

Learn To Trade Binary Option (Manual Vs. Automated Trading)

You can either manually trade binary options or can use binary options software which will do the trading for you.

When you trade manually, you choose the asset, the expiry time, and most importantly, the decision to call or put. Everything depends on you alone. Moreover, you have to set a strategy using indicators and trend lines to make a decision.

In the case of automated binary options trading, a binary robot does all the work for you. It is a programmed software that makes decisions based on certain algorithms.

On the other hand, most binary options robots allow you to customize settings such as investment per trade, risk level, indicators, and choice of assets.

However, if you want to completely leave your fate at the hands of the trading robot, you may do so. Or you can put manual effort also by building strategy.

We would recommend a mix of both auto and manual trading for the best results. We have compiled and reviewed the best binary option trading robots for you.

Learn How To Trade Binary Options Successfully and Profitably

Binary Options are known for their simple and fast nature of trading.

Despite its simplistic nature, many traders lose on their binary trades far more often than you think.

This boils down to reasons such as lack of trading knowledge, experience, or choosing the wrong broker.

Whatever the reason may be, there must be a clear plan ahead of trading so you don’t face ill-consequences in your trading result.

This is why we are writing this guide on how to trade binary options for beginners. First, we will define what binary options are.

What are Binary Options?

We are going to explain a basic concept on binary options in here but if you want details knowledge then read the what are binary options article to know about binary options in detail.

Binary Option is a type of option where you have two outcomes – all or nothing.

You have to accurately predict the outcome to make a profit.

If you guess wrong, then you lose your initial investment and gain nothing.

This is why they are referred to as binary options trading.

Binary means 0 or 1. In this case, it means all (payout) or nothing.

There is nothing in between. It’s either a win or a loss.

Binary Options Trading have a fixed expiration; i.e. a fixed time and date.

You can trade binary options in 2 ways; either manually or by auto-trading.

In manual trading, you do all the hard-work and place the trades yourself using your own trading strategy.

In auto-trading, binary options robot does the trading for you using its own trading strategy.

Which method you use for trading depends entirely on your preference.

If you are a new trader, you might take the help of a trading robot in exchange for a price or you can learn the basics of trading and do it yourself.

How to Trade Binary Options for Beginners

This section will focus on how to trade binary options for beginners. To learn how to trade in binary options, read this guide to get started.

The factors you need to ensure when choosing a broker to invest with are:

  1. Regulation
  2. Demo account
  3. Minimum initial deposit
  4. Ease of use
  5. Variety of assets
  6. High Payout percentage
  7. Fast withdrawals
  8. Multiple modes of payment

These factors will be discussed in detail later in the article.

In addition to that, you refer to our list of binary options brokers

It’s not necessary that you have to stick to one broker.

No broker is perfect and one broker may not suit all your needs. Don’t hesitate to trade with multiple brokers.

Register an account with the broker you have chosen.

Registering an account is free of charge with most brokers.

All it takes is your vital information such as an email address, your first and last name.

Once you have created an account, you need to practice trading which brings us to our next point.

Don’t jump straight into live trading.

You need to practice trading on a demo account until you are comfortable with the basics of binary options trading.

Educate yourself on the basic concepts of binary trading.

Understand what strike price, call and put option, expiry terms are.

Familiarize yourself with the different ways you can trade binary options.

Just because the funds and the outcome in demo accounts don’t hold any real meaning, it doesn’t mean you should trade recklessly.

Trade on the demo account exactly how you would live trade.

This practice will develop your trading skills and build valuable experience.

There is no fixed duration on how long you have to practice on a demo account.

Take as long as you need. Finally, when you feel confident enough, you can step up to real trading.

You need to deposit on your trading account in order to carry out live trading.

You can start trading on a real account once you are familiar with the ins and out of binary trading.

Select your preferred asset and choose your investment amount.

Depending on your prediction, buy a call or put option.

Place your trade and wait till your trade expires to know the outcome of the trade.

In the next section, we have listed some tips and techniques on binary trading to make your trading successful and profitable.

“RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK”

How To Trade Binary Options Successfully And Profitably – Best Way To Trade

You need to turn your binary options trading into a successful profit machine.

Not sure how? We got you covered.

Follow these below tips to ensure you don’t lose money while trading binary options.

Trade those assets that you are most familiar with.

No need to take unnecessary risks by trading in markets that you cannot predict.

Success in binary options completely depends on how well you can predict the market.

Follow the market news for the asset that you are trading in.

Diversification of your portfolio is one way of reducing your overall risk but it doesn’t mean you should diversify to assets that may not be profitable to you.

Invest as little as $5. Get the hang of trading and then you can start increasing your trade size.

The point is to minimize your losses while gaining valuable experience.

As a general rule of thumb, don’t invest more than 5% of your total budget on a single trade .

No matter how much you practice on a demo account, trading on a live account is a totally different scenario.

There is real emotion involved which brings us to our next point.

Binary options are fast-paced and short-term.

This makes them exciting to trade. You may experience a rush of emotions while trading and that may hamper your results.

It can result in making the wrong decisions and ultimately losing your hard earned investment.

Due to their all-or-nothing nature, trading binary options can be a burden on your mind.

Take breaks when you face a losing streak. Treat every loss as a lesson and avoid making the same mistakes in the future.

This may seem like a matter of preference or a trivial issue but even expiry time is a crucial factor when it comes to binary options trading.

It is often the expiry time that can be the difference between winning and losing a trade.

For example, a trend was supposed to reverse within an hour.

But if you placed a trade with 2-hour expiry, the trend would have reversed by then and you’d lose the trade.

Whatever underlying asset you may trade, you need to be informed on the latest global events and news associated to that asset.

Many traders form their market strategy depending on the market news.

So don’t skip on that and act accordingly.

For example, if there is negative news regarding the gold and a price drop is imminent, log in to your binary options trading platform and open a put position on gold.

Reacting appropriately to market news can bring in more trading success than you think.

Unless you are a pure gambler looking for absolute results i.e. either maximum profit or nothing at all, you should make use of hedging.

Hedging is a money management strategy used to protect your profits.

When you buy a call option as you predict the price of the underlying asset will increase, you also open a put option in case your prediction goes wrong.

In this way, if you are wrong on your prediction, you lose money from your call option, but you regain that back from the put option.

This act of protecting your investment by buying a binary option contract opposite to your initial contract is hedging.

Hedging may reduce your overall profit potential, but it also protects your capital.

If you quite confident about your prediction but still want to hedge, invest the lesser amount in the hedge position compared to your main position.

This cannot be stressed enough. You need to constantly educate yourself with trading knowledge.

Even though binary options looks easy and simple on the surface, there is a lot that goes into constantly turning your trades into profitable ones.

One of the big factors that play a role in the success of your trading is trading education.

Watch videos, read guides, attend seminars related to binary options trading.

You are less likely to commit mistakes and perform better trading analysis when you are equipped with trading knowledge.

“RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK”

How To Trade Binary Options With Cryptocurrency

Cryptocurrencies are the newest digital asset that has been garnering a lot of attention due to their rapid price movement and volatility.

If you are not interested in owning cryptos, many brokers offer crypto trading in the form of options.

In these cases, the cryptocurrency is usually quoted with a fiat currency, such as the US dollar.

Everything else remains the same as binary trading.

When you speculate a price rise, you go long and go short when you expect the price to drop.

Let’s explain this with an example. You want to trade binary options with bitcoin. Here, you betting on the price movement of Bitcoin against the USD.

Currently, the value of Bitcoin is at $3900. If you think it’s price will increase, you will buy a call option, i.e. go long on BTC/USD.

After the expiration period, depending on whether your prediction turns out to be accurate or wrong, you win a payout or gain nothing respectively.

With bitcoins and other altcoins, it is extremely important to start with a small investment and carry out your trading analysis and research.

The crypto market can be both rewarding and risky at the same time.

Make sure you utilize the trading tips on binary options listed in the later section of the article.

“RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK”

Factors To Look While Choosing the Best Binary Options Broker

There are certain factors that we listed in the previous section when choosing a broker.

In this section, we have explained these factors in detail.

They will help you in determining the best binary options brokers.

This is the first factor that you have to look for when choosing a binary options broker.

If a broker is regulated, it means that there is oversight and monitoring from a government body.

This means if you lose your money, legal action will be taken against that broker.

Make sure the broker you choose doesn’t charge a fortune as a deposit fee.

The lesser you have to invest as a deposit fee, the lesser your exposure is.

This reduces your risk and allows traders with small capital to trade.

The trading platform provided by the broker must be easy and fast to use.

The features and the tools must be intuitive and user-friendly to traders.

The binary broker you choose must offer a variety of trading assets under their portfolio.

They must cater to all kinds of traders. Some traders prefer to diversify their portfolio by investing in multiple assets.

Top brokers offer 100’s of trading instruments to their traders.

This is another crucial factor that comes into play when choosing a binary options broker.

A binary options demo account allows new traders to learn to trade without losing real money.

For experienced traders, a demo account allows traders to practice multiple trading strategies and see what works best for them.

The broker should provide a high payout percentage. A payout of at least 85% is preferred by traders.

Traders will most often choose the broker that offers the highest payout ratio.

Withdrawals are a pretty big deal to traders.

After winning trades, traders desire to withdraw their funds quickly and without any hassle.

The verification process and the withdrawal process should be quick.

Brokers should offer traders multiple modes of transactions.

Credit cards, bank wire transfers, e-money transfer service, or even using cryptos.

Taking all the above factors into consideration, we have prepared our list of recommended brokers that you can trade with.

These brokers meet all the requirements such as regulation, offering a demo account, huge asset index, high payouts, fast withdrawals, easy-to-use trading platform, and much more.

Here is the list of brokers that we think will offer you the best binary options trading experience:

How To Trade Binary Options – Manual vs. Automated Trading

You can either manually trade binary options or you can utilize an auto trading software which will do the trading for you.

When you trade manually, you choose the asset, the expiry time, and most importantly, the decision to call or put.

Everything depends on you alone. You have to set a strategy using indicators and trend lines to make a decision.

In the case of automated binary options trading, a binary option robot does all the work for you.

It is a programmed software that makes decisions based on certain algorithms.

Most binary option robots allow you to customize settings such as investment per trade, risk level, indicators, and choice of assets.

However, if you want to completely leave your fate at the hands of the trading robot, you may do so.

We would recommend a mix of both auto and manual trading for the best results.

We have compiled and reviewed the best binary option trading robots which you can refer.

Features Of Binary Options Trading

Here are the features of binary options trading:

You don’t own assets in binary options. You only speculate on their price movement.

Binary options are derivatives based on the underlying asset which you don’t own.

This can be seen as both advantageous and disadvantageous to many.
When you own an underlying asset of a company, you also own a share of that company.

You get ownership benefits such as taking part in company decisions.

You win a payout for accurately guessing or you don’t win anything at all. This makes it a unique form of trading.

With binary options, you are not limited to a single asset type.

You can trade assets from different markets such as forex, stocks, commodities, crypto, and indices.

Certain types of trading such as CFDs have no fixed expiry on them.

You can continue your position as long as you prefer.

In the case of binary options, there is a fixed expiration period.

The expiry period ranges from 30 seconds to all the way up to a year.

There is a lot of flexibility offered to traders in terms of expiry period.

The minimum expiry period depends on the underlying asset and the broker that you are trading with.

In the case of binary options, there is a lack of leverage and margin.

This means you cannot open a position larger than your available funds, nor can you lose more than you invested.

Some traders enjoy the benefits of leverage while some avoid it to prevent additional losses.

One of the best ways to reduce risks in binary options trading is to exit out of a trade before the expiration time ends.

In an active trade, when the market moves rapidly against you and you see no chance of recovery before the expiry.

In this case, you can exit out of a trade by contacting your broker and requesting an early exit.

You won’t be fully able to recover all your profits this way, but you can at least minimize your loss and protect a portion of your profit.

Notice that not all brokers provide this feature. You might have to check with your broker before you decide to trade with them.

Exiting prior to expiration time serves the same purpose as ‘stop-loss’ and ‘take profit’.

However, these features are not available with binary options trading.

Some brokers do offer cash back in case you are out the money (wrong prediction).

The cash-back rate varies from 10%-20% depending on the broker.

Binary options are traded as over the counter instruments meaning the trading is not carried out in formal exchanges such as NYSE, or the Toronto Stock Exchange.

It means trading via a dealer (broker) rather than a centralized exchange.

If you guess accurately on your trade, you get rewarded with a payout.

The payout amount depends on the broker and the underlying asset.

This percentage is usually in the range of 70%-95% in the case of high/low and boundary binary options and can exceed well beyond 500% in the case of touch/no touch and ladder binary options.

“RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK”

Conclusion

Binary options have earned a bad press due to the actions of many scam brokers.

However, there is no doubt about the legitimacy of binary options.

It is a proven method of trading that brings in profits in a short period of time.

It takes a lot of factors to be successful at binary trading.

The purpose of this article was to educate new traders on how they can maximize their profits in binary options trading.

In order to succeed in binary options trading, you need to learn how to trade binary options.

There is no alternative or shortcut. Put time and effort in educating and then practice what you have learned.

Binary options are comparatively new compared to other forms of trading such as trading forex or commodities.

However, it is quickly gaining popularity and mass adoption due to its simplistic nature, high payouts, a large variety of assets, flexibility in expiry time, and many other reasons.

How To Trade Binary Options Successfully: Complete Guide

Maybe you feel you are now ready to start trading in binary options, and you are excited. Everyone who is getting involved in binary options trading wants to profit from it. You want to know how to master binary options trading. Many will get involved because they have been told they can double their money quick. Unfortunately, that’s not always the case. In fact, many of the best getting involved in binary options trade end up losing and quitting the trade altogether. Many binary options brokers will not tell you this, because they profit when the traders lose. Regardless of how many trading tools, strategies, or round-the-clock financial markets are available, many traders do not achieve the success they wish for.

IMP NOTE:

Now Get Real Account with as little as $10. And start trading the BINARY OPTIONS, FOREX, FX OPTIONS & CRYPTOCURRENCIES at one platform. Click To Open Free Demo Account | Click To Get Real Account In $10 (Updated July 2020)

The fact that most people do not profit from the trade has not kept people away from it though. More people continue signing up on binary options brokers’ platforms hoping to make some money there. It is estimated that only 5 percent of the people who get involved in binary options trading profit from it. Five percent might sound like a small figure, but bear in mind we are talking about millions of people around the world. There is, therefore, a good number of people profiting from trading in binary options. So, what does it take to profit from trading binary options? What do you have to do to know how to trade binary options profitably? Our hope is that this article can help you successfully trade binary options. Let’s dive in and explore.

We are going to divide the plan on how to trade binary options successfully into two.

1. Basic Steps – this step with show you how to start binary options trading.

2. Strategy

Basic Steps

These are basic steps that you should take to ensure that you are set to trade binary options successfully. These are steps that should be employed by everyone seeking to trade in binary. Please note that these steps do not guarantee winning results, but they will certainly go a long way in ensuring you get the results that you desire. We are going to look at six common steps (assuming you already know what binary options are and how binary options brokers work). Let’s get to it right away.

6 Basic Steps to Successful Binary Trading

1. Choosing the Appropriate Broker

Why do you need a broker to trade binary options? You can only trade in binary options through a binary options broker since the capital threshold for the main market is very high. It is estimated that there are over 400 binary options brokers around the world currently. These brokers have different services and, therefore, the broker you choose plays a huge role in your success as a trader. Some of these brokers are actually scammers. Always go for a reputable, licensed and regulated broker. Your success as a trader depends a lot on the resources and features offered by your broker. Some brokers will offer educational materials and resources while others won’t. You need to get a reliable and trustworthy broker. Keep in mind that the brokers make a profit when you lose.

My Recommended Brokers

2. Start Small

Many people and the brokers themselves will tell you that starting with a demo account is the best way to get started. I beg to differ! However, Why? I mean you don’t have to stake your money with the demo account, so you get to learn slowly.

You see, most of these binary options broker accounts give you a virtual financial market on the demo account. They will not give you access to the real market because in the actual sense there no capital in your account. It’s more like learning to ride a bike by pedaling on a stationary bike. You could still start with a demo account if you are a complete novice, but don’t dwell on it a lot thinking you are learning a lot. It would be unfortunate for you to get involved in the real financial market thinking you know a lot only to end up losing a lot of money because you actually know nothing. My advice is to start with a real account, but start small. Start will small amounts.

3. Managing Risks

This is one of the most important, if not the most important, aspects of trading binary options. If you have no risk management skills, you might as well consider yourself to be gambling rather than trading. Risk management starts with the minimum deposit. Do not deposit money you don’t have. By that I mean;

  • Do not deposit money into a binary trading account when you have pending bills
  • Do not borrow money to trade binary
  • Do not deposit money that is not yours

You need to understand that you cannot solely depend on luck while trading binary. Traders who depend on luck do not last. Once you have your deposit on the trading platform, do not stake all you deposit at once. A general rule is not to use more than 10% of your deposit in a single trade. Chances are that you will lose a couple of times. Give yourself a chance to redeem yourself once you make a wrong prediction. Statistics show that a majority of the binary options traders join a platform, make the first deposit, fail to manage risks and loses all the deposit, then quits and never trades again. That brings me to the next step.

4. Keep the Emotions at Bay

People get carried away by emotions and take too many risks, or quit before they have really explored binary trading exhaustively. The same way you are advised to keep the emotions and attitude away from a workplace is the same way you keep them away from binary options trading because things are not always going to go your way. There are two emotions that are quite detrimental to your trading endeavors;

  • Fear- many people, will make people fail to make a lucrative trade because of fear. You counter fear by having a strategy and sticking to it. We are going to look at strategy next.
  • Greed – greed does to you the opposite of what fear does, but you still end up losing. Greed leads you to take too many risks. Again, it is tackled using strategy.

Keeps these two emotions, and generally all other emotions at bay while trading. Get a strategy and constantly focus on how to improve it. Once you have established a solid strategy, stick to it so long as its working.

5. Personal Discipline

If you do not have personal discipline, you might as well not think of getting involved in binary trading as well. Indiscipline and laziness will kill your dreams of successful binary options trading on arrival. You need to be able to handle high-pressure situations. They need to reason fast and reason logically. Also, learn to stay put even when things do not go your way. Things will fail to go your way a lot of times in your trading endeavors, especially when you are beginning. That’s why many people never make it out of the beginner phase.

6. You Never Know Enough

You can never know everything there is to know about binary trading. You will be shooting yourself in the foot the moment you start thinking you got the perfect strategy and you know it all. The learning never stops. Concentrate on constantly improving your strategy. That improvement will reflect on your winning strategy. Many binary options broker platforms require you to have over 60% winning rate to make a profit.

Strategy

The strategy is the magic word in any binary options trading space. Having a binary options trading strategy is your best bet if you wish to make anything trading in binary options. If you have no strategy for trading in binary options, you are basically gambling. Gambling with binary options has been proven not to be sustainable time and time again. Gambling with binary options is even worse than gambling on pure betting sites and casinos. At least you have the chance to win a jackpot and get life-changing money on the betting sited and casinos (they are rarely won though).

Strategies are based on the financial market behavior. To have a strategy, you need to have some analytical skills or employ a third party that can help you with the analysis. You as the trader relies on statistical and analytical data to analyze the financial market. This approach is usually a bit difficult for beginners to understand, and most of them end up quitting. The strategies developed through the analyses are the most reliable though. There are a lot of resources developed to help you understand the analysis process and the charts. There are no best days to trade binary options. Most of the trading platform run for 24/7.

Below are three of the most common approaches to coming up with a trading strategy.

1. Overall Performance Analysis Strategy

The asset you may choose to trade with is attached to a certain company. The operation of that company is going to have an effect on your trades with the selected asset. Therefore, you would want to concern yourself with the performance and attributes of the company. You need information such as; how the balance sheet of the company looks, cash flow status, income statements and more before you purchase an option.

Also, concern yourself with technical aspects such as employee and partners satisfaction. Generally, this strategy is based on observing the company of the asset you be trading with and the whole industry at large. They will help you make judgments about how their stocks are going to perform.

2. Technical Analysis Strategy

This is a popular and less complex strategy. It is employed by many successful binary options traders. This strategy involves studying and analyzing the past performance of a certain asset and using the findings to predict the future. Analyzing the past gives you a picture of the behavior of an asset in certain conditions. The findings will give you a certain level of certainty of what is going to happen if you anticipate the asset is going to experience similar conditions ahead.

Time is also a crucial factor in binary options trading. For instance, the best time of day to trade 60 second binary options, is during the day when there is a lot happening that effects the trend of the financial markets. During the day is the best time to trade binary options currencies. The is no best time frame to trade binary options though. It depends on how well analyze the previous trends at any given time.

This strategy does not concern itself with the intrinsic value of the asset. As a trader, you do not have to go through the financial statements of a company. There are trading tools used for the technical analysis such as moving average and Bollinger bands and many others. It is one of the strategies to trade binary options.

3. Basic Options Strategy

This is yet another popular strategy that every serious binary options trader should consider. It is fairly easy to understand. The strategy is based on risk minimizing the risks as much as possible. The strategy protects the trader from incurring complete losses, in case they make wrong predictions. Once you pick an underlying asset or currency pair; let’s say the GBP/USD if you notice the market is moving in a good direction you will place a call option, but you also place a put option on the other end on the same asset. The GBP/USD is the best currency to trade binary options.

This is how it works;

Say the currency options GBP/USD is currently at 1:4000 and you are anticipating that it is going to go up so put place a call option of $100 that expires in 10 minutes. You are offered a payout of 80% if you get it and a 10% cash back if you miss it. After the first five minutes, the pair is at 1:4015 which is okay but not convincing. Therefore, you put a put option of the same amount with an expiry of 5 minutes. The payout and cashback percentages remain similar.

So, what are the possible outcomes after the last 5 minutes?

Outcome One

You call option wins and the put option losses, or vice versa. You will have a total payout of $190. That is; the 80% profit from the win, and the 10% cashback loss on the other end. You end up losing $10 since you had staked $200.

Outcome two

You could win on both the call and the put options and get $360. Two wins of $180 each. It is nearly impossible to lose on both ends due to the dynamics of the market. Losing on both ends is only considered hypothetically.

In the scenario depicted above you the amount of loss risked if far less than the possible total possible win. It means if you were to put up three consecutive such trade pairs, then lose two and win one, you would still end up with a profit.

There are many more strategies that are employed. Successful traders use these combine the basic strategies to come up with their best strategy to trade binary options. You trade when you feel you have a leverage in knowing what will happen next to the asset you are trading with. There is no best time to trade binary options. Having a strategy is the way to go if you hope to make anything in binary options trading. It is the safest way to trade binary options.

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IQ Option 10 1 95 1st Choice
ExpertOption 50 1 95 2nd Choice
Olymp Trade 10 1 92 3rd Choice