Binary options meaning

Best Binary Options Brokers: 2020 Ranking
  • Binarium
    Binarium

    Best Choice! The leader in our ranking!
    Perfect for beginners!
    Free Demo Acc + Free Trading Education!

  • Binomo
    Binomo

    Good choice for experienced traders!

Is Binary Options a Scam or Legitimate Trading Tool?

Before we analyze whether binary options is a scam or not I would like to take a look at day trading, an area which I have much experience, and see if day trading would qualify as a scam.

As a day trader many people looked В upon what I did withВ skepticism. Many thought that day trading was just a another form of gambling. Many trading companies would try to lure people with the potential to earn a living with electronic day trading with very little investment. The truth is, for the overwhelming majority of people, day trading was a losing effort. Few traders were successful; most lost money. The firms made a lot of money collecting commissions and profit share from the good traders. After my first year of day trading I was convinced that it was impossible, or nearly impossible to make money. I began back in 2002, after the bubble burst and volatility was at a virtual standstill. Few traders were making money with any of the traditional trading formulas that worked a few years earlier. I was fortunate enough to come upon someone who had a “system”. The trading system provided an “edge” in the market. When traders diligently followed the system they consistently made money. When I began trading with the system I made money on a consistent basis. I opened trading floors to teach others to trade within this system, but most did not made money. Trading within this system required extreme discipline both to enter a position and to leave a position when the rules required. Those who followed the rules diligently made money. Like mostВ professions, one needs education or skills to make a living. The same is true with day trading. Along with these skills a person must have the proper discipline in order to succeed. Its a business that is clearly not for everyone.

The same can be said for Binary Options. В The companies that set up binary option platforms and binary option brokers are in this business to make money. В The firm collects 80- 100% of a losing trade and pays outВ 60-80% on winning trades. Someone who wins on 50% of their binary option trades will lose money. Unless someone has a system that has a winning track record and the person adheres to that system consistently he will over the long term win on 50% on his trades and lose money.

Of course it is possible that some of the binary option brokers in the market are making promises that they cannot or will not fulfill. If a broker makes falseВ assertionsВ or won’t refund deposits or payout profits to a customer then that broker may be considered a scam. The binary options trading industry itself is not a scam. It may be difficult to actually profit trading binary options, but the risk and rewards are clearly displayed for the investor. Whether one makes money or not is up to the actual trader. We have completed В a series of comprehensive reviews of binary brokers. In our reviews we determine, to the best of our ability, if the brokers are providing the services that they claim to offer. В Once you have the confidence that a binary option broker is providing a legitimate service you will then be able to implement a trading style that mostВ effectivelyВ yields profitableВ tradingВ results. All of the brokers we have tested so far have proved to be providing a legitimate service. Some of our reviews include older more established brokers such asВ 24option as well as newer brokers such as Bee OptionsВ and Redwood Options.

Why are binary options better than Forex?

Online trading has been growing tremendously over the past few years, mainly because of notable technological strides which have made online trading space more appealing to investors. Unlike in traditional trading which demanded physical presence and lengthy documentation in over-the-counter exchanges, online trading has proved to be convenient since traders can trade financial securities from the comfort of their homes and even while on the go; using versatile mobile apps provided by online brokers. Binary options’ popularity has been soaring over the past few years owing to sky-high returns and simplicity of trading.

However, it may be confusing for a new financial trader whether to venture into binary options or Forex. Well, they both have their similarities but they are very different in most aspects. We have prepared an article on why binary options are superior compared to forex trading. Read on for a clear comparison between binary options and forex and reasons why you should go with the former.

In definition, binary options are fixed contracts which are characterized by fixed payouts and fixed trading durations. Trading binary options are fairly simple compared to other markets since a trader is only required to predict the direction of market price movement. On the other hand, Forex is a financial market where traders seek to leverage on distinct price changes between a currency pair. Forex and binary options have been in existence for a long time with the former outliving the latter

Upsides of trading binary options compared to Forex

No margin trading

Margin trading is common in forex trading and it is used to increase trading capital and consequently increase potential profits. Maximum margin offered varies from one forex broker to another. However, even though margin trading may translate to higher returns on investment, it is worth noting that a sharp decline in the prevailing market price of a currency pair can be disastrous to your bottom line. In binary options trading, margin trading is non-existent and hence you never get a margin call. Binary options traders can still earn up to 90% returns on a single trade. Even better, some high-yield options can have payouts of up to $1000.

Fixed Payouts and Losses

Maximum profits in forex trading are always uncertain. A trader can only use the stop order tool to set the maximum percentage return after execution of an order. Well, knowing the price level to set a limit order can be risky especially if the trader is driven by greed. Also, it is imperative to note that you can only use the stop loss trading tool to define the maximum loss you can make once an order is executed. In the event that the market price of the underlying currency pair, you can only make a loss up to the stop loss value. However, with no stop loss set, the risks are spread to the entire trading account. If the market moves negatively, your trading account can be wiped clean in a matter of hours or even minutes if the market is very volatile. It’s not a big deal in forex trading to go out for shopping to later come back to a negative trading account (if you used margin).on the bright side, a positive sharp price hike can translate to more returns. But is it really worth it?

Best Binary Options Brokers: 2020 Ranking
  • Binarium
    Binarium

    Best Choice! The leader in our ranking!
    Perfect for beginners!
    Free Demo Acc + Free Trading Education!

  • Binomo
    Binomo

    Good choice for experienced traders!

On the flipside, a binary options trader always knows what he will get or lose from the word go. Binary options brokers offer fixed payouts which are usually a percentage of the underlying investment. High-yield options can attract payouts ranging between 400-1000 percent and normal trades’ payouts range between 65-90%. Additionally, trading risks are strictly restricted to the invested funds. Meaning, funds in a trading account are shielded from the trading risks irrespective of the magnitude of change of the underlying asset.

Flexibility

It’s a proven fact that monotony in financial trading can lead to recklessness when making crucial trading decisions. In forex trading, a trading portfolio is restricted to currencies and unless you are a forex enthusiast, it can be pretty boring. Forex does not offer many options to play around with. Forex traders can only use the Buy/Sell orders. Other orders available include limit, OCO, Trailing Stop, hedge and stop orders.

On the other hand, binary options are more of a hybrid financial market since traders can access a vast selection of assets derived from the four asset classes; currencies, stocks, commodities, and indices. Binary options trading offers traders an exciting trading environment since most brokers offer a variety of trading options. Options offered by most brokers include Call/Put, High/Low, Up/Down, Touch/No Touch, Ladder, Option Builder, Turbo options, Boundary Options, and Tunnel Options. The option Builder trading option allows a trader to customize his own option to fit his trading style.

Less or no hidden trading costs

Forex trading is characterized by commissions and broker fees, not to mention swap and spreads. With some brokers, commissions and fees are astronomically high which in turn “eats” into your profit margins.

Binary options trading is however very different from forex as far as costs are concerned. There are no commissions and hidden fees in binary options. Literally, what you see is what you get. If let’s say a trade attracts a 90% payout, that’s exactly what you will get at the end of a trade.

Conclusion about binary options

For the analogy above, you can clearly see why binary options are better than forex. Binary options trading attracts “lesser” risks, no hidden fees, more flexible and simpler to trade. However, binary options and forex are also similar in some aspects. For instance, both have trading risks, require a starting capital and are traded online. If you want to try binary options trading, don’t hesitate to use our broker reviews section for details on trusted binary options brokers.

Can you Really Make Money with Binary Options?

Updated on: 6 January 2020

Binary options trading is very popular in many countries around the globe. However, most people still ask the question “can you really make money in binary options”. In this article I will try to answer this question and give you a few tips on how you can make money trading binary options.

The short answer is that yes, you can make money online with binary options trading if you only trade at legitimate binary options brokers and learn the fundamentals of binary trading and employ proper trading strategy.

Binary options trading is a form of investing through predicting the movement of various assets such as gold, silver, the USD etc. It is very similar to other forms of investing such as forex and stock trading. It’s however simpler, has relatively fewer risks (in the sense that you will always know in advance what you might lose) and can offer larger payouts.

The idea is that you can make money in binary options only if you treat it as a real form of investing. This means learning how it works, learning how to read charts and learning how you can make accurate predictions. All these are not that difficult but it takes some time. If you treat it as gambling and just make random predictions then you will obviously not win.

Trading binary options online is not as complicated as many people think it is. You don’t have to be an economics expert in order to make money by trading binary options. Below these lines I’ll reveal why making money with binary options is actually pretty simple.

Quick guide: Yes, you can make money in binary options. The easiest way is to use a binary options robot, such as BinBotPro that will automatically analyze the markets and make accurate predictions for you. This is fully automatic and comes with a success rate of around 85%. The huge advantage of BinBotPro is that it trades with cryptocurrencies such as Bitcoin where daily gains of up to 20%-50% are very frequent.

At this moment the most reputable binary broker where you can make money if you use proper strategy is IQ Option. IQ Option has a payout rate of 88% and is also the broker with the most licenses and government-approvals, which means it’s 100% safe and fair. If you are from the US you can trade at BinBotPro instead, which is also a reputable broker.

Hot in 2020: Cryptocurrencies are the biggest gainers in 2020. You should register at BinBotPro in order to make a lot of money. BinBotPro is a trading bot that will invest in Bitcoin when it’s starting to go up and sell when it’s starting to go down. You can make up to 5% to 10% gains every day with BinBotPro.

September 2020 update: If you wish to make money without trading then you should check out Bitcoin mining. All you need to do is renting hash power and wait to see your Bitcoin being added into your wallet over time. Check out IQMining and their offers.

With Bitcoin mining you do not need to trade and your profits are almost guaranteed. You only rent the server and will then be paid out by the moned Bitcoin, which you can exchange into fiat currency. There is no possibility of “losing” your deposit here, as you will not be trading. You will get daily Bitcoin payments into your wallet. Check out IQMining now.

Best Binary Options Brokers: 2020 Ranking
  • Binarium
    Binarium

    Best Choice! The leader in our ranking!
    Perfect for beginners!
    Free Demo Acc + Free Trading Education!

  • Binomo
    Binomo

    Good choice for experienced traders!

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