Why Not Try Binary Trading?
Our Recommended Binary Traders
Binary Trading removes the exclusivity of stock market trading and simplifies the matter, making it available to anyone willing to give it a try. Binary Trading is made even more appealing by the fact that making a decision is summarized by your option to either go low or go high. In some ways, Binary Trading has been likened to gambling as both forms of making money have inherent risk factors with outcomes going only one of two ways, but then isn’t the entire stock market a gamble? To further simplify the process of Binary Trading, it entails an investor focusing, analyzing and eventually deciding on whether a financial asset will increase or decrease in value within a certain time frame. For the purposes of practicality, imagine you’re making a purchase on a binary cash-or-nothing call option on the EFG Company’s stock at NZ$100, which carries a binary payoff of NZ$1 000. When the maturity date arrives, which is also known as the expiry date, and the stock trades higher than NZ$100, you pocket a cool NZ$1 000. If the stock trades below NZ$100 then there will be no financial rewards.
Binary Trading has become very popular in recent years due to its inclusive nature and the simplicity by which it can be conducted. In an effort to squash the complicated mechanisms associated with stock market trading, Binary Trading puts forward 4 simple steps that will assist you in making your trade:
- Decide upon which asset you’d like to trade: The selection process is that of an eclectic one as there are hundreds of tradable stocks from which to choose. Through a process of analyses, usually aided through the software you’re provided with, take your pick from a selection of tradable stocks, indices and commodities and currency pairs.
- Decide upon the maturity date and an amount you’re willing to trade: The breadth of scope you’re given in this procedure is more than adequate as the date of maturity or expiration can be anything from 1 minute to one year.
- Decide if the stock will rise or fall: A Call option is indicative of your belief that the stock will rise/increase while a Put option is the opposite – that the stock wall fall/decrease.
- Put forward the trade and wait for the maturity date of your option: While you wait on your option to expire, monitor its performance through a series of software tools, often issued with the Binary provider you’ve registered with.
- Assets: This is what your trade is comprised of. An asset can come in the form of indices and commodities, stocks or currency pairs.
- At the Money: This terms refers no loss and no reward. In other words, the price at the maturity date is on par with the strike price.
- Broker: Before any trading can take place, an account with a Broker needs to be set up.
- Call Option: A particular binary option that goes profitable when the unit price for the underlying asset surpasses the strike price at the expiry date.
- Charting: A tool for purpose of a more in-depth investigation of the price of an option.
- Commodities: Assets and items that are drilled, mined and grown.
- Currency Pair: This is when two currencies get paired and are then observed. A common case is the Dollar and the Euro.
Popular Strategies for Binary Options
- Fundamental Analysis: Conduct a background check of the company or stock you’re about to bet on. Look into things like the health of their balance sheets, cash flow statements and income statements. Also investigate what employers of the company are saying – you can ascertain this through an HR department or on the company’s website. In the same breath, see what business associates and partners are saying. This will give you a good overall idea of the business you’re about to bet on or invest in.
- Technical Analysis: Look into the past performance of the company/stock/commodity/currency that you’re about to invest in. Look at past trends to assist you in predicting its future performance. This kind of research doesn’t require an in-depth analysis and can be conducted by tools such as Bollinger bands and Moving Averages.
- Algorithmic Signals: There are apps available for the analysing of market data. Investing in such an app could help you to gather appropriate and helpful data which in turn can help you make more informed choices. This app will gather data and present the best possible outcome and can also pick a trade for you to make a call on.