Stock trading is nothing new; it’s been around as long as companies have sought additional funding for everything from start-ups to expanding current operations. What has changed is the methods with which trading is conducted.
The business of trading used to be conducted in a fairly closed environment; clients simply watched the ticker-tape, read the financial columns of the newspapers, and instructed their brokers as to what their wishes were via telephone. But as soon as the Internet came along the old way of doing business began to change rapidly. Individuals can now do their own instantaneous research and have their brokers place orders within minutes or the next “trading window.”
This evolution of technology has been leveraged to open many new ways to trade. For a while day-trading was the new big thing. Fortunes were made and fortunes were lost. But time marches on and one of the hot topics today is binary options trading.
The first step is to find a Broker that suits your trading style and needs. We recommend the following;
So what is binary options trading? The title itself is descriptive; you might recall that the computer science term binary means that only two characters are possible, zeroes and ones. Likewise, with this type of trading, only two outcomes are possible. In other words, this is an all or nothing form of trading. The pay-out is known in advance and the trader makes his prediction as to where the asset will go within an expiry time for trades which can be anywhere from 60 seconds to 150 days. If the prediction is correct, score! If not, try again.
Given that, the important thing to note is that with binary trading money can be made in all financial climates. It doesn’t matter whether the market is up or down, bearish or bullish, only what the projected trend will prove to play out.
So how can an investor get started? The first thing to do is dig in and research and find a broker that specializes in binary options. Many brokers may claim to be the “go-to” firm for this type of investment, but due to the nature of this type of trading it is important to find someone that really concentrates on short-term movements in the market, not someone that has a focus on a buy-and-hold type of investment philosophy.
When the broker who is continuously monitoring the market sees a potential movement, he sends his premium clients a “trading signal.” The investor now determines whether or not to make a move on the opportunity. Binary options are based on moment to moment decisions.
A variation of managing this type of trading that proves convenient is the “in/out or boundary trade” type of market order. In this scenario, the investor acknowledges two strike prices which form the upper and the lower price boundaries. You might hear these referred to as a ceiling and a floor.
Most investors will want to know what kind of investments they can trade in. For example, when investing in drip funds, the corporations themselves must opt-in in order to participate; many do not like to sell partial shares because they are not that eager for additional financing. But in the case of binary options trading, these restrictions are not so restrictive. Conventional stocks are commonplace although many are only available depending on locale. In other words, a broker may only handle stocks of companies in his geographical areas although almost all will deal with global stocks such as Coca Cola.
Index funds, as usual, are some of the safest funds to invest in since they spread the risk over the entire sector of the market rather than relying one company or industry. Currencies are also popular trades. Currencies can pose a challenge because they are constantly in flux. Also, the juxtapositions of so many national currencies against others are so numerous that the investor’s locale comes into play if his investing style is more local rather than global. But the savvy investor that pays attention to this market on a day-to-day basis stands to profit.
For more speculative investors, commodities are an interesting area to investigate. For example metals such as gold and silver are always in the news and due to their volatility are very well suited to this investment paradigm. Crude oil and natural gas are other good examples of good candidates for binary options trading. Energy prices are very susceptible to supply and demand, political conditions at both the supply and refining points, and constantly-changing laws. Being able to follow and predict these volatile conditions can lead to a healthy paycheck.
To have success, every investor needs a workable strategy. A simple internet search will bring up several strategies that investors are using but the interesting ones are always sold for money instead of being available free.You can try your luck with the free strategies but real working ones are not available for free. If you spend some time on searching the internet, you will be able to find some legitimate binary options strategies for reasonable price.
But NOTE: before buying any binary options strategy, make sure the seller doesn’t ask you to join any specific broker because such sellers are most probably selling non-sense stuff.
Binary options trading is not for every investor but every investor should take a look at it. In today’s market no opportunity should be ignored, especially when the chance to make a quick profit rather than a long-range profit is possible. After all, those quick turn-around profits are often what funds the buy-and-hold type of investments.