Periodically, in a circle of friends or in the vast expanses of the network, a term such as “binary options traders” slips past the attention of users.
As a rule, these words are associated with a high income on the Internet, which allows you to have a good level of comfort and absolutely not depend on a particular place and, all the more, a strict and incomprehensible boss.
But on some forums, you can also hear echoes of disappointment in option trading. Given the popularity of the topic and the ambiguity of the information background associated with it, this area of ​​earnings is worth exploring in more detail.
Binary Options: The Truth
To begin with, it makes sense to determine exactly what options are and what they eat. So, options are called options for the reason that they take the form of a regular option contract. The term “binary” was assigned due to the most simplified trading system, in which there are only two options.
In fact, the meaning of working with options is to correctly determine where, in which direction the price of a particular asset will go: up or down. If the direction was determined, then the trader is making money, with an erroneous forecast, he is losing money.
Online binary options signals can be used to acquire various types of assets. These can be securities, currency pairs in the financial market, cryptocurrencies, world goods, as well as stock indices.
Obvious benefits
Given the simplicity of trading and the possibility of fairly quick money, many who want to change their financial level pay attention to binary options. "Divorce or not?" this is the question many inexperienced users ask when they hear from others about the prospect of earning so attractively. In order to get an answer, it is worth considering both positive and negative sides of this method of financial growth. Let's start with the benefits.
- A simple process. For those who intend to try their hand at making money using the Internet, it will be difficult to find a simpler profit-making tool. After all, all that needs to be done is to correctly guess the direction of movement of the quote.
- High level of profitability. This aspect is one of the main within the framework of the topic "Binary options - the whole truth." The essence of the financial miracle of options comes down to the fact that the trader has the opportunity to double his capital in one transaction. But only in the case of a correct forecast, of course. This level of return allows you to earn a decent amount in a short period of time.
- Minimum entry. One of the main problems in the formation of any source of income is the need for investment. In the case of options, you don’t need a lot of money to try your hand. It is possible to start with $ 10 on hand.
- Both risk and profitability are known initially. Everything is very simple here: the trader, before buying an option, already knows how much he will lose in case of failure and what his potential earnings will be. Moreover, the size of this indicator can be determined independently, thereby regulating risks.
- Unlike the Forex market, binary options trading is available around the clock on any day of the week, including Sunday.
disadvantages
There are also disadvantages, which inevitably implies such an earning tool as binary options. The whole truth of the negative side of trade comes down to a few key points.
- Very high risk. If we compare this type of options with other instruments of exchange trading, then we can confidently say that its use involves the highest risks. Capital can be lost as easily as doubled - in one transaction. But even if you manage risks, you can part with a deposit with such trading much faster than in the case of the Forex market.
- Short trading gaps. Binary options transaction prediction time is either short or very short. Such large time frames, as in the case of classic options, are not used here. But trying to predict the movement of quotes at minimum time intervals is extremely difficult, and in most cases this simply cannot be done. For this reason, the vast majority of traders, especially those who have just come to this area, tritely guess the outcome of the transaction.
- There are few tools to conduct a qualitative analysis. The binary options chart on both trading sites and terminals does not allow the player to carry out a technical analysis of the selected asset, with which it would be possible to make forecasts. Under such conditions, it is very difficult to make stable money.
- Difficulties with brokers. Quite a few, before opening an account, try to determine what binary options are - a divorce or not. AND it is fair to say that in some cases inexperienced enthusiasts will be deceived. The facets of fraud in this area are numerous: from incorrect data to the banal non-payment of earned funds. Submitting any claims later will not be easy, since most companies are registered in offshore zones. To avoid negative situations, it is worth examining the ratings of brokers. For example, if you search for binary options in the search engine, IQ Option will be one of the leading companies in this field. Having found out this fact, you need to carefully study the reviews about this broker and the like, and then make a decision.
Obviously, you need to weigh the pros and cons before making a choice in favor of such an exchange instrument as binary options. Reviews, real and in different forums to read is also necessary. This will help determine the most reliable broker and protect yourself from unpleasant situations in the future.
What does the trading process look like
In order to make money on binary options, you first need to install an online platform that will allow you to receive signals and open deals. Such a platform gives the trader access to various assets, among which he can choose the most predicted. The quotes of these assets are constantly changing due to various economic processes.
The platform used for trading also provides access to economic news. To help the trader, some companies offer both free binary options signals and those for which you have to pay. This means that the trader can use not only his subjective opinion regarding the movement of quotes, but also use information that helps to make a certain decision.
But, as mentioned above, it is extremely difficult to predict the direction in which the chart will go, even with auxiliary tools.
In most cases, companies offer to try virtual trading with a tool such as binary options. A demo account provides an opportunity to understand the essence of the process and evaluate the chances of success by making the right number of transactions.
But even with some success in trading on a demo account, you need to understand that when using real money, the emotional state of the trader actually always changes, which directly affects the player’s decisions.
When choosing binary options, training should be considered as a necessary condition for successful activity. Of course, for stable trading, the knowledge gained will not be enough, but at least the trader will be aware of the processes he is dealing with and will be able to develop more dynamically.
Features of trading signals
First of all, it should be noted that there are three key types of signals for binary options:
The basis for their issuance is the following information:
- individual opinions of analysts;
- indicator readings;
- duplicate analysis;
- regional and world news;
- calculations of professional traders and analysts.
Find out which signals are the most optimal, it is possible only through trial and error in working with a specific asset. Moreover, you need to try both paid and free signals, because in both categories there is irrelevant and valuable information.
Brokerage signals
We are talking about information that brokers themselves provide. Its purpose is to help the trader make the right decision. Often they are relatively accurate. This is due to the fact that companies want to attract as many players as possible to their platform. It makes sense to take such signals into account if binary options were chosen as the source of earnings. The whole truth about this type of earnings comes down to the fact that no one can guarantee the predicted movement of quotes, so you should not lay absolute hope on such signals.
This means that it is always important to consider the possibility of losing and correctly distribute the risks.
But there is definitely a certain benefit in such information. If the broker is serious, then he forms a team of professional analysts who monitor the economic situation in different regions, analyze the news and test the market on an ongoing basis. The fruits of this particular work are the signals from the broker. That is, it is not a subjective opinion, but a summary analysis of the market and specific assets.
Paid and free signals
In the network, if you wish, you can find a significant number of offers regarding paid signals for binary options. Choosing a specific option, you need to be extremely careful, because along with experienced traders and companies, amateurs who want to get easy money can also sell signals. Therefore, in a topic such as binary options, reviews (real and in large quantities) will always be relevant.
You need to check any proposal and every company with which you intend to work. This will save a lot of money by avoiding cheating.
It is worth noting that in the vast majority of cases, experienced groups of traders offer to buy signals, which combine their efforts to conduct high-quality and extensive analytics and provide relevant information to those who are not competent in the topic.
But in any case, buying a signal is always a risk, since the degree of their effectiveness can be found only after acquisition.
As for free signals, they can be useful and in some cases even more relevant than paid ones. To the question "Why would anyone give such information for free?" There are several possible answers:
- If a trader gives free high-quality signals, he quickly gains a high rating and can subsequently attract investors' money, which will significantly increase his earnings.
- There are resources that are focused on the promotion of brokers. For such sites, issuing free signals is also beneficial. This allows you to attract the attention of beginners who, after quality information, will be motivated to open an account with a particular broker.
Training
In such a topic as binary options, the whole truth, of course, will not open to a beginner in a few weeks of practice. But the path to understanding and acquiring the necessary skills can be significantly reduced if you go through training.
Such information can be offered either by brokers or experienced traders. This applies to systematized data divided into topics. If you study for free or ask for little money, then you can take a couple of courses. This will eliminate the initial illiteracy and understand the essence of trade. But you should not be limited to one source of information. It’s better to monitor the appropriate resources and compare the flow of topics.
The best option would be to check various brokers with the help of network resources, determine the fact of which of them is the most honest and the subsequent training there. Such a recommendation has its own logic. The bottom line is that those companies that focus on earnings through the commission will do everything so that the maximum number of traders use their services. This means that they will also train with high quality.
If we talk about brokers who are interested in a massive drain of deposits, then you should not count on honest training that will help you earn money.
It is possible and necessary to supplement the knowledge base by visiting specialized forums. Usually it is on such resources that the most interesting information is found. In addition, on the forums you can ask a question and get answers from a significant number of users. Thus, choosing binary options, training must be completed, but do it wisely.
Using robots
This is another way to make a profit, but without active personal participation. The binary options robot is nothing more than an electronic program, customizable in accordance with the trading strategy of the trader who bought it. Subsequently, the robot will perform these actions automatically, without the participation of a trader.
The robot independently analyzes the charts, the movement of quotes and opens transactions in accordance with the algorithm that the trader has set.
The developers of such programs, of course, do not reveal the secrets of the laid down systems for evaluating the schedule, but in most cases they are based on working with indicators that various indicators give out. It is the fact that how many indicators will be involved and how competently the robot settings have been made determine the degree of effectiveness of the program.
You also need to choose robots with an accompanying study of the reviews and recommendations of real users.
There is also the opportunity to automate trading through advisors that will copy the transactions of a particular trader. Finding companies offering such a service will not be difficult.
The essence of such trading is that a novice trader who buys a robot from a broker can receive automatic duplication of those transactions that successful players make. Moreover, the capabilities of the robot allow not only to be limited to one platform, but to collect and analyze information about transactions of various traders. After, according to the specified algorithm, the filtering and selection of the best candidates for duplication of transactions occurs. In this case, the one who acquired such an adviser can only observe active trading.
There are companies that offer a beginner to study the rating of traders and choose a specific player to copy his transactions. This option is also quite attractive, because without experience you can use the strategy of a person who has developed his skills for a long time.
How to choose an option
Another issue that the trader has to solve is the choice of a specific type of asset for subsequent trading.
When it comes to starting a business, it’s better to focus on classic assets, since they are easier to trade and understand as a whole. After the terminal is mastered and certain skills appear, you can move on to more exotic options. But you should always remember that it is possible to use a demo account to test a new area of ​​work.
Also, in the trading process, it is worth finding out which time frame is the most optimal. For example, you can feel more confident working with options for 60 seconds than over longer time periods.
Summary
When choosing binary options with a deposit of any size, you need to be aware that this earnings has both the potential for ultra-high returns and extremely high risks. As for the possibility of stable earnings, there is one, but it is possible to achieve permanent profit only if you have rich experience.
Use this tool as the main one will be reckless. Binary options are best used as an additional opportunity to make a profit, risking only the amount that can be lost without deep regrets.