How to start Binary options trading

The binary trading industry is very popular throughout the world right since its inception in  2008. Binary options trading has gained so much popularity because of its simplicity to trade and fixed risk involved in any trade.

In binary options trading, the trader purchasing the underlying asset ( EURUSD, GBPUSD or USDJPY ) picks CALL option in case he expects the asset value to increase at the close of the expiry period, i.e at the end of the minute/ 5 minutes/hour/day/week/month. The trader will place a CALL option in case he/she thinks that the option amount would surpass the current pricing while the trade is on.

On the other hand, the person will pick a PUT option in case he/she thinks that the price of the asset would not be higher as compared to the current pricing.

Binary options trading – getting started

Binary options are considered to be a complex financial trading product and hence beginners are advised to get enough training and practice before they start trading.

Binary options trading involves a high level of risks. Hence Binary Options Beginners must allow themselves to learn and practice before jumping into trades involving real money. The first step for all new traders is to trade in a demo trading account till they know every aspect of binary options trading. After acquiring the required experience, knowledge and skill, the beginner can get started in Binary options trading.

Select the right broker for Binary options trading.

It is extremely important that the brokers whom you trust with your investment have proper certifications and licenses to carry out their business.

Broker NameSpecial FeatureReviewVisit Site
Regulated Broker. Up to 91%* payout.

Check review

Visit-site
Regulated. Up to 90 % Payout.

Check review

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binomoRegulated Broker. Up to 90% payout. Withdrawal in up to 3 days.

Check review

Visit-site
Binary Options Robot compatible with regulated brokers. Check reviewVisit-site

* Amount to be credited to account for a successful trade.

 RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK.

Register for an account, and make your deposit.

Register for an online binary options trading account with one of the recommended brokers that suits you best. I personally open accounts with multiple brokers, as I don’t want to put all my money with one broker.

Start trading binary options with hundreds of assets.

1. Select an Asset to trade


The trading platforms have so many assets to choose. You may choose from Forex pairs, commoodities or stocks.

2. Predict the price movement


If you predict the price of the asset to rise sellect CALL option (UP). If your prediction says the price will fall, then sellect PUT option (DOWN).

3. Decide the amount to invest


Decide your investment amount and options expiry time. You can choose expiry time ranging from starting from 1 minute to 1 month.

4. Collect the winnings


Your profit gets credited to your account instantly after expiry of the trade , if you win the trade. In other words you get up to 95% return on a trade, if you predict price direction correctly.

Binary options are mostly traded under the pricing umbrella of FOREX. The traders who have some understanding of Forex market find it simple to trade binary options. Binary trading is considered to be much simpler than Forex trading because it has no stop loss settings, the risk is fixed in each trade and the trader knows in advance about the likely potential loss amount. Some binary options brokers provide binary trading on popular stocks like Apple, Facebook, and Google, indices like DJ30, NASDAQ etc.

Binary options can definitely help you maximize your returns in a short period of time (definitely not overnight ), provided you have the right knowledge to succeed in this industry.

Why people choose binary options trading?

In this fast-paced world, fast-paced traders choose binary options for better returns on their investment. The binary options traders are well aware of the risks involved in binary options trading. A trader can lose all his investment in few seconds, at the same time he can earn up to 92% (  Amount to be credited to account for a successful trade ) return on the investment. Hence comes the importance of trading binary options safely.

How does the risk impact binary options trading?

Let us assume there is 1000 USD in your binary options trading account.

Since there are two outcomes of a binary options trade, you have 50 % chance of winning a trade. We will study the trade outcome of three traders for the same sequence of WIN and LOSS.
Let us choose some random sequence of trade result for 10 trades with 5 losses and 5 wins, 1-Win, 2- Loss, 3- Loss, 4. Loss, 5.Win, 6-Win, 7-Loss, 8-Win, 9-Loss, 10-Win.

Mr. Craziest Trader:  Watch how this trader losses his money in just two trades, losses 1000$ in just 2 minutes.

Trade SequenceInvested AmountWin/ LossReturn on investment 85 %Balance
11000Win8501850
21850Loss00

Mr. Crazy Trader:  invests $100 in each trade and his trade results are summarized below:

Trade SequenceInvested AmountWin/ LossReturn on investment 85 %Balance
1100Win851085
2100Loss0985
3100Loss0885
4100Loss0785
5100Win85870
6100Win85955
7100Loss0855
8100Win85940
9100Loss0840
10100Win85925

Mr. Cool Trader: Mr. Cool Trader starts trading with $10 with a money management strategy and lets us see the result he achieves.

Trade SequenceInvested AmountWin/ LossReturn on investment 85 %Balance
110Win8.51008.5
210Loss0998.5
325Loss0973.5
450Loss0923.5
5100Win851008.5
610Win8.51017
710Loss01007
825Win21.251053.25
910Loss01043.25
1025Win21.251064.5

In the above example, you have seen how Mr. Craziest Trader losses his money in few minutes, whereas Mr. Cool Trader manages the risk with money management strategy. Mr. Cool Trader ends up with 6.4 % profit in a day by risking 10$ per trade while winning and systematically increasing the trade size to recover the losses.

Mr. Cool Trader has the potential to grow his account to  MILLIONS trading over a year, considering there are 20 trading days in a month and compounding the investment every trading day. (Don’t get misled, this is a hypothetical calculation. May not be possible practically.)

The mathematical probability of winning a trade in binary options is 50% if we add certain technical analysis, look for support resistances, we can increase our winning probability beyond 50%.

Hence the growth of a binary options trader is solely dependent on money management strategy, patience and discipline.

How do we keep ourselves profitable in Binary options?

  • You must not be greedy to risk all or a big portion of our investment in a single trade.
  • If you trade with patience and book 5 to 6 winning trades a day, your account of $1000 has the potential to grow into a million over a year.
  • You need the right education, training, and tools to achieve this. You would enjoy the trading experience as you keep on learning sophisticated analysis and strategy.

Are you ready for Profitable binary options trading?

To stay profitable in binary options trading you must have your master plan. You must familiarize yourself with some basic analytic tools like RSI, Stochastic oscillator, Bollinger Band and Market trend. You should practice trading using these indicators with strict money management in a demo account. After you see your success you should proceed for a real account and trade with consistency, patience, and strategy.

How can successful binary options trading change your life?

By this time, you might have come to know that, it is not difficult to trade binary options but the real difficulty lies in controlling your greed, emotions and sticking to right trading strategy consistently. If you successfully manage your emotions, greed, and strategy, you can become a successful binary options trader. Over a period of time, a successful binary options trader can accumulate a lot of wealth to enjoy life better and give his family a better life.

The success in binary options trading will require a lot of practice, but I’m happy that you are on your way.

RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK.
NOTE: This article/material is not an investment advice.