Binary options are categorized as financial derivatives. When trading binary options can occur exactly two scenarios: Either a prediction occurs — or not. The mathematical concept of binary nature says that there may be just two states. The simplicity of this trading genus is fascinating for many traders. Just lay are often attracted to her, but sometimes do not know what lies just beyond.
1. How do binary options?
Basis for trading in binary options, the purchase of an abstract right to a basic value. The permitted underlying stocks, indices, currency pairs and commodities can be selected. In a binary option, for example, Daimler, the buyer acquires no share, but is instead focusing on the development of Daimler shares. Binary options offer classic call or put trade, depending on the broker, profits up to 100 percent on capital employed. In so-called high-yield commercial yields even reach up to 500 percent and more. Gains rates in the capital market the risk with.This applies to bonds as well as options trading. Do not ever assume the exchange-traded goods or assets the price development, the wish for investors. At this point, the greatest risk lies in trading binary options: If the trader has omitted loss protection, may suffer a total loss of principal. Well, it depends on the bet — at minimum lot sizes between a Euro and 25 Euro, the loss is certain to get over with a small sum.
Binary options are one of the transactions. With the acquisition of a binary option chooses the investor if the price of the Underlying from time of purchase to increase the expiry time or will fall. This variant is easiest. This is the classic call and put trading. If the dealer right in his prediction, he registers a profit. Even when prices are falling so profits can be earned — because it is about a true prediction. This presentation provides maturities of less than a minute to several weeks. Binary options can be traded every trading day in any case. For the trade over the weekend , the so-called offers one-touch — or one-click trading on. This offer the broker makes it possible to confirm or reject a rate forecast with a simple click on «yes» or «no.» For example, is the broker offer that the DAX up to a specific day in the following week exceed the 10,000 mark. Is the investors of the prognosis and is correct, winnings are paid up to a limit of 500 percent. If the trader is wrong with his prediction, he has lost the use of this trade.
In general: Binary options are one of the transactions. With the acquisition of a binary option chooses the investor if the price of the Underlying from time of purchase to increase the expiry time or will fall.
2. Three Tips for trading binary options
Trading in binary options seems simple at first glance: either the forecast merchant is true or not. Quite so simple it is not to make a correct prediction. Especially beginners should therefore use in the first experiments only small sums to keep the risk of losses low. What are Binary Options? As they are doing the right thing? To be successful in trading binary options, should not decide the luck on profit and loss.Rather, an extensive knowledge and experience are required. As with all trading activities are the prerequisites for success good market analysis and of course a sensible trading strategy. Here are three tips that can help when trading binary options:
Continuing education! Trading in binary options is not complicated. But you should have a good overview. Learn, are how to properly analyze and understand how the market trends the market.Most brokers have with webinars a good further education, which should be used.
Develop a clever trade strategy. A rule could be, for example, that you only invest in an option after you have watched them for a certain time.
Not too much to invest and spread the risk! Set a maximum amount you want to invest in a trading session. You should prevent losing all your capital with few trades. Distribute the risk low stake on many trades.
The most important thing in binary options:underestimate the risk Not! It is advisable to develop a wise trading strategy, educate yourself and not to invest too much in some trades, but to spread the risk sense.
3. Risk in binary options: avoid total loss
The advantage of binary options is the clarity of the possible results, because there are exactly two variants that may occur — gain or loss.This course is also accompanied by a certain risk that should not be underestimated. There is always the risk of total loss. So if high on a trade totals are used, in bad case can be lost all the money. The possibility for the trader, by Binary options to lose all his capital, but can be prevented in advance. The trader should specify a maximum amount he wishes to invest. A rule could be, for example, use never more than 2 percent on a trade. A special form of trade in binary options is 60 s have Trade offered by several brokers. This forward contract is a particularly high risk, since this may mean only short-term movements in opposite directions at the wrong moment in a loss. Even if the trader has taken a long-term accurate forecast, may accidentally cause the Lot closes precisely at the moment when there is a short variation of the course — the money may lose. It when traders who make 60 seconds trades in advance to schedule loss series is best and are aware of the high risk. In order to avoid the total loss when trading binary options, only some of the capital should be used. If the forecast of Traders is false, threatening otherwise too high a loss.
60 seconds trades applies: Coincidence plays a certain role, this fact should be taken into account by the dealer.
4. Make The Best Choice: Binary Options Broker
To select the right binary options broker, several aspects should be considered. It is important to a transparent product and profits of up to 500 percent. In addition, it should be ensured that trade even small sums is possible and can be speculated at both falling and rising prices.The decisive factor is the additional possibility of loss protection.
The selection criteria that trader at his choice should have in view, at a glance:
- Is there a low minimum trading amount ?
- If a small minimum deposit required?
- Is there a possibility of loss protection?
- Is there a demo account and a good service and support?
- Is also mobile commerce offer?
Conclusion: For choosing the right broker for trading binary options filters play a role. Traders who are looking for a provider should, especially the points minimum trading amount, minimum deposit, loss protection, service and mobile commerce closer look before making a decision.