Binary Options 201

Binary Options 201

Welcome to Binary Options 201, your next step to gaining massive learning in effective binary options trading. We made it a must to enhance your experience with us by providing the latest resources to help you master everything related to binary options, from defining your investment amount to managing risks.

How much should I trade per day?

Binary options is subjective to the extent that it can result in huge losses or profits depending on how dedicated and knowledgeable you are in the field. Defining how often you need to trade per day is a thin margin between being greedy and knowing where to stop. Or should we say, making profits or losses.

Whether you are an expert in the field of binary options or just a beginner, there are some actuals consideration you should cater for, before even trading. These constitute the foundation of any trader. Here they are:

  • How much can you afford in trading without disrupting your daily expenses?
  • Why are you trading? Is is because you want to meet the ends month or just for fun?
  • Do you have the required knowledge to trade binary options? The probability for you to make profits is relatively low when you don’t have enough experience in the field.

If you are well aware of the above, then should seek to invest in quality trades rather than quantity while not being lead by your emotions. In fact, traders often cross the border of rational trading when they get swayed by their emotions and this has a negative effect over the trading outcome. Hence, it is better to trade on 5 well-researched and calculated trades rather than over flooding your account with wrong trades which most of the time result in losses.

How do I choose the right opportunities?

Choosing the right opportunities is one of the determining factor which makes the trader successful in his trades as well as confident in his endeavors. Considering the market fluctuates at a constant and sometimes unpredictable rate, it is important for traders to opt for the right opportunities. There are different ways to spot and benefit from the right opportunities.

One needs to identify trades with high volume trend or movement. These are considered as the most stable ones and hence less fluctuations in the price. For instance, Gold happen to be the preferred asset of novice traders as it is one of the most stable and traded assets. Furthermore, traders should also identify the market sentiment and determine the trends associated to the opportunities.

The second point you need to consider is the returns you will get from your chosen opportunities. While some opportunities generate low returns others can help traders gain great profits. For instance, the currency pair USD/EUR carries an average of 75% of returns on investment while the USD/YEN carries an average of 82 % returns. However, regardless of the opportunities they opted for, traders also need to understand binary options and the different associated strategies to take wise decisions.

Opportunities often happen following one or a combo of the following:

  • A drastic change in the supply and demand for a particular product.
  • The release of a financial report
  • Environment calamities which affects the different assets and create opportunities for trading.

Finally, there are some opportunities, considered as mere fads which have a short time span. Here, traders need to stay alert after placing their trades. This is why most brokers are investing in creating mobile trading applications and other trading signals.

When should I trade?

Due to binary options unstable nature, it is quite difficult for traders to spot the right time frame to trade. Assets’ prices change within seconds and even if you are trading with a minimum of 5 minutes expiry time, it is even difficult for expert traders to predict the next move of an asset. Concretely speaking, you never know when an asset will take the curve and decrease in value.

The most common mistake which traders do is attempting to predict a new trend. If substantiated with in depth research and high level analysis, this can prove to be effective. Most of the time it results in incoherent or irrelevant prediction, again due to the volatility nature of the asset.

The solution is to predict an asset following a long and strong trend. The only constraint is that traders need to have some patience. Most of the time, traders support their analysis with fundamental and technical analysis as well as getting insights from the indicators of the asset’s movement.

Once you have spotted a strong trend, you need to look out for its trade volume which indicates how traders are reacting towards this market. If you want to know more about market trend and how to make optimum use of it, you can read more on our trend analysis article.

How do I choose the right asset?

Besides knowing when to trade and how to seize the perfect trading opportunities, it is equally important to know which assets to trade. The first and foremost advice we often give to traders is to stick to what you know and gradually learn how to trade other assets. None is expert in his or her field but everyone can take advantage from what he or she already know.

As such, before adventuring in unknown waters, spend time to learn them while also gaining profits from the ones you know already.

Similar to seizing the right opportunities depending on the return on investment, it is also important for traders to know the return they will get according to the asset chosen. Precisely, some assets are more volatile than others and hence carry more associated risks and ultimately high payouts.

Hence, depending on your investment capabilities and your knowledge on binary options, you would eventually choose the asset which is profitable and stable enough with low risks.

Maximising Trading Income

Going beyond the just enough profits is what most traders are looking for. Indeed, binary options is also here to help traders make generous profits. However, this requires some efforts and hardwork. Maximizing trading income can be achieved through several means. Find below some main points.

Trading assets which you are comfortable with is definitely one of the main way you can easily gain higher income if you analyse its trend well during the day. Support your trades with sufficient learning and strategies. The main reason why you should stick to the assets and tools you are comfortable with is the time factor. Though this is subjective to traders, it often takes more time to master a new tool.

Speaking on trading tools, it is often recommended to use more than one. If you are a novice trader you would eventually have to learn how to use new tools while experienced traders should have a real master plan to trade and be versatile with different trading tools at the same time. Each trading tool have their own specificities and requirements. Furthermore, tools have different expiry time and potential payouts which, if applied correctly, can lead to high revenue for traders.

Added to these, are bonuses and promotions which often give a certain boost to the trading account. Your investment capabilities increase and as such your trade volume also increase. However, most of the time traders will take bonuses for granted and spend less time analysing the market. The main reason is because losses will not directly affect their trading account and investment. Bonuses and promotions will help you gain more profits provided that you invest similar time and efforts in applying proper strategies to make the most out of it.

Reminder about Risk

Binary options has changed how trading was initially done. Thus, bringing at the same time a lot of risks and unreliable brokers over the internet. The risks are real and can cause harm to both your private and professional life. One of the main downfall of traders is when they fall prey to scams present all over the internet. Scams are sometimes difficult to spot as they emulate real brokers. Besides checking their regulation status, there are other ways to choose the best and reliable broker. You may read more on our article to find out the common mistakes traders make and fail to choose the right broker.