It’s a Simple Yes or No in Binary Options Trading
Not yet heard of binary options trading? Let’s explain what it is. Put very simply trading binary options is investing money in the performance of a particular asset during a given period of time. In other words with binary options you’re making a bet on two things – whether the price of something is going to go up or down. You have the option to buy or sell an option. If you choose to buy the option you’re expecting the asset to increase in value. If you’re selling you’re expecting the value to go down. In order to comprehend the advantages of binary trading let’s first look at other trading markets and forms of investment. Most types of investment require the investor to purchase the asset they’re investing in. Selling the asset back to the market when the price increases means a profit’s been made. If the value of the asset has decreased their money has been lost. With this kind of investment you’re constantly watching the markets and worrying about picking the right time to sell. Binary options trading is trading on the market rather than being in it.
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The Advantages of Trading Binary Options UK Investors Should Know
With binary options you can trade a range of different assets across many markets. The obvious advantage is that his kind of trading offers greater rewards in a shorter period of time than other popular methods of investing. But let’s look at some other reasons to consider trading in binary options UK.
You don’t need to have huge amounts of money to trade with. You’re able to risk as much or as little as your budget allows. Prior to making an investment you are advised of what you could win or lose when making the trade so you can decide whether you’re prepared to take the risk because you know what’s at stake. You can clearly see what you’re you might be risking should you choose to invest. Something that’s not possible in any other form of financial investment trading. We suggest using sites like bestbinarytradingbrokers.com to limit the risk with trusted brokers pick.
Big Rewards and Quick Returns
Compared to other forms of financial trading binary options are much shorter. Rather than being held for months or even years binary options can range from a few minutes up to a week before you see a return. Being able to trade quickly over a short period of time and the potential for high returns, sometime as much as 88% means you can make substantial profits with just a few quick trades.
Trading is Simple
If you trade with the best binary option broker trading is pretty simple. Just a few simple steps need to be followed and pretty soon you’re able to make your first trade. You have to choose the asset you want to trade, decide how much you want to trade and whether the asset is going to go up or down in price. The last step is to decide on a time for the trade to expire and then you just sit back and see what happens. If you’ve predicted correctly you make a profit but if you’re wrong you stand to lose your money.
You Can Trade in a Wide Range of Assets from all over the Globe
There are many different options you can trade in from all over the world. So whatever your field of expertise or interest you should have no problems finding the right asset for you. When you find a binary option broker take a look at the assets they have available and check each one carefully. Some may have as many as 90 assets including commodities, stocks, indices and currency pairs with forex binary options, thous using some bonus offer like listed on this site would be great start for you.
Trade Any Place, Any Time
With binary options trading you can make your trades wherever you are and whatever time it might be. Binary trading brokers have a range of different platforms to use whether you’re sat at home on your PC or on the move using a mobile device. As this form of trading takes place all over the world there will always be a market open you can invest in so it’s 24 hours a day, 7 days a week affair.
Learn the Binary Options Lingo
Whatever market you’re investing in, whether it’s the stock market, forex binary options or one of many others it’ll come with it’s own exclusive language. In order to be successful you need to understand what your fellow investors and brokers are talking about so let’s look at some of the binary options jargon you’ll encounter.
Call option – when you predict that the asset you’re interested in will increase in value. Even the smallest of increases will give you a profit.
Put option – this is when a trader predicts that an asset will decrease in price. As with a call option even a decrease as little as 0.10cents will lose you money.
In the money – when you win a trade you’re in the money. If you place a call option and the price increases you’re in the money in that particular binary option. Likewise if you place a put option and the asset goes down in price you’re also in the money.
Out the money – this is when you lose the trade. In other words you’re not correct in your prediction.
At the money – you can probably guess what this means now. When the price of an article is the same at the time of expiry as it was during trading time you were neither right or wrong. In this case you investment will be returned in full.
Expiry date – this is the date or time at which your option will expire.
Different Types of Binary Options
There are many different types of binary options you can choose from so let’s look at a few.
Indices Binary Options
This is one of the most traded binary options and includes the Dow Jones Index and FTSE 100. When you choose to trade in indices you are predicting whether the value of stocks and shares are going to go up. Unlike trading in stocks and shares you never have to actually use a stock broker and pay their exorbitant fees.
Currency and Forex Trading Options
This is becoming more and more popular and for a variety of reasons. It might be that they just want to make a profit or that they want to hedge any actual currency purchases they’ve made. You can pair up any number of different currencies and that also includes the virtual currency bitcoins.
Commodity Binary Options
This is trading on the value of commodities such as gold and silver, copper or oil.
Individual Stocks Binary Options
Buying stocks and shares can be very risky particularly when you consider how frequently their prices fluctuate. Trading binary options means you can now trade in hundreds of different shares and stocks without the need to actually buy them. The largest number of binary options are traded in the largest companies such as Microsoft and Walt Disney for example.
Finding a Trustworthy Binary Options Broker
There are plenty of website offering binary options brokerage services but how do you know you’ve got the best one? You should be looking at where they’re based, whether they offer 24/7 customer support and what type of trading platforms they offer. Ask friends and family whether they can recommend a broker or whether they’ve heard any horror stories about the ones you should avoid.
If you don’t do your research you’re leaving yourself wide open to some of the pirates and scam artists that start up, waiting to catch out the novice investor. Don’t be tempted to jump into bed with a binary options broker who offers amazing bonuses but very little else. Here’s a few things to look out for in a reputable broker:
- You’re able to trade any volume – large or small. The brokers that offer a diverse range of purchasing limits are often the best.
- You can pay in a variety of ways – be very wary of any broker who only gives you one option for making payments. The more options a broker offers the best chance you have of finding a cost effective method.
- Trade with no limits – some binary options trading brokers put maximum limits. not only on how much profit you can make per trade but also on how much you can actually cash out.
Well hopefully we’ve given you some basic information, enough to enable you to decide whether binary options trading is something you’d like to try. We wish you all the best in your endeavours and don’t forget that with any form of investment, profits are not guaranteed 100% of the time. That being said binary options trading can be very exciting and you can limit the amount of money you risk. Practice is the best fist step and plenty of brokers offer practice accounts.