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.
Welcome to our Binary Review section. From here on in we’ll lead you into our various Binary Trading reviews and help you to get acquainted with the various websites that offer this very unique style of trading in stocks and commodities. Binary Trading has become quite popular in the last few years and for a number of reasons. Some call it trading-lite, others refer to it as downright gambling. But let’s face it, playing the stock market is a gamble and with Binary trading, you actually have less to lose. This is not to say that this kind of trading should be approached willy-nilly. You still need to monitor the stock and make what you consider to be an informed call.
How Does it All Work?
Binary Trading aims to simplify the process of stock market trading. It aims to give the average Joe a chance at something that’s often clouded in all kinds of complicated terminology. Put another way, if you’ve ever had an interest in the stock market, then Binary Trading provides an accessible entry point. Most of the sites that we’ve reviewed offer a series of assets such as indices, currencies, stocks and commodities. With statistical data you can monitor the asset and predict whether its value is going to increase or decrease – and that’s really what binary trading comes down to at the end of the day.
Trading is Exciting
Trading is exciting for a number of reasons. Firstly the potential gains are quite high and if you’re lucky or make good calls you could see massive gains really fast. Imagine not having to actually buy stock in Microsoft or Apple but still being able to profit from the way their stock performs? Imagine not having to buy stock on coffee but being able to profit from its performance? Binary Trading removes a lot of the complexities around stock trading and simplifies the process to such an extent that anyone who’s willing to try and take part in this world that for the longest time was considered exclusive. Believe it or not, but the trading sites that we promote offer sign-up bonuses too! This means that if you’re going to try trading for the first time, you can get in some extra traders cash. If you’re ready to enter the exiting world of investing while avoiding a fair amount of the pitfalls, then this might just be for you.
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.