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Binary Options Day Trading in Russia 2020
Binary options trading hinges on a simple question – will the underlying asset be above or below a certain price at a specified time? If so, you can make substantial profits with one of the most straightforward financial instruments to trade. But what exactly are binary options, and what are their benefits and drawbacks? This page will answer those questions, as well as detailing how to start day trading binary options, including strategies, tips, and regional differences to be aware of. Use the broker top list to compare the best binary brokers for day trading in Russia 2020.
Binary Brokers in Russia
What Are Binary Options?
Firstly, let’s have a look at how it all works. Put simply, binary options are a derivative that can be traded on any instrument or market. They appeal because they are straightforward. You know precisely how much you could win, or lose before you make the trade. No complex maths and calculator is required. This is why they are also known as ‘all or nothing’ trades.
If you anticipate news announcements, quarterly reviews, or global trends, then you may be able to make an accurate determination as to whether the price is going to increase or decline at a certain point in the future, turning a profit.
There is a whole host of derivatives to choose between. You can trade binary options on commodity value, such as aluminium and crude oil. You can opt for a stock price, such as Amazon and Facebook. There are foreign exchange rate options, including all the major and minor pairs. Even cryptocurrencies such as Bitcoin, Ethereum, and Litecoin are on the menu.
A Brief History
If you want to start trading binary options full-time, a detailed understanding of their origins will help. Binary or ‘digital’ options have been around for decades. Originally though, it was only large institutions and the fabulously wealthy that had access. However, 2008 saw the US Securities and Exchange Commission open the floodgates by allowing binary options to be traded through an exchange.
The internet and technology have since given the whole world access to these ‘digital’ options. As it stands, with low barriers to entry for savvy day traders and a simple to understand preposition, the demand for these digital trades will only increase.
There are a number of different option types to choose from. The most popular types are listed in the brief glossary below.
- Up/Down (High/Low) – The most simple and prevalent binary option. Will the price be higher or lower than the current price when the expiry time comes?
- In/Out (Range or Boundary) – A ‘high’ and ‘low’ figure will be set. You are then making a determination as to whether the price will finish within or outside of these boundaries.
- Touch/No Touch – Levels will be set that are either higher or lower than the current price. You then enter a position as to whether the price will ‘touch’ these levels between the time of trade and expiry. Payout will come as soon as the touch takes place.
- Ladder – These are similar to up/down trades. However, instead of using the current price, the ladder will have pre-determined levels that are staggered up or down. These normally demand a substantial price move. The flip side of this is returns will frequently exceed 100%. Although it is worth noting, both sides of a trade are not always available.
Another important component of binary options is expiry times. This is when the trade will end and the point that determines whether you have won or lost. These times can range from 30 seconds and 1 minute (turbos) to a full day (end of day), and even up to a whole year.
As an intraday trader though, you will be more concerned with trading 5 and 30-minute binary options. Opt for binaries with 1 minute expiry times though and you have the ability to make a high number of trades in a single day.
Is Trading Binary Options Legal?
Despite the somewhat negative reputation, the reality is binary options are legal. The majority of companies operate fairly. Opinions have been split because there are some out there that operate scams.
Regulation in certain regions has meant binaries have been withdrawn from the retail market. In the EU for example. But professional traders can still use them. In regions such as India and Australia, binary are legal – but traders should make sure they use a reputable broker, and read our section below on avoiding scams.
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Scams & Frauds
The binary reputation has suffered from dishonest marketing and cybercrime. Too many unregulated brokers promise quick cash, whilst operating frauds. Regulators are on the case and this concern should soon be alleviated.
Binaries themselves are perfectly legitimate, but steer clear of ‘instant money’ promises, brokers that cold call, and celebrity endorsements, plus any claims that you can ‘start trading binary options for free’.
So it isn’t a question good or bad, it’s simply a question of being alert to the dangers and knowing what to look out for. If you’re unsure about a broker, ask the question in a live trading room to check they’re properly regulated.
Binary Options Vs CFD Trading
Although in some ways similar, there remain some crucial differences between binary options and CFDs. With CFDs, you have potentially unlimited risk. If the price of the asset moves significantly, the value of the trade can grow very large, very quickly – for better or worse.
Whereas binary options work slightly differently. Whilst you are still investing without owning the asset in question, the gain and loss rate is fixed. With a call option, it doesn’t matter if the price rockets, you retain the same percentage as if it rose by just a couple of pips.
Likewise, if the price sinks to zero, you’ll only lose what you put in. So, to define the difference – with binary options you get fixed risk.
Having said that, just as if it was binary options versus forex trading, you are restrained in your profit potential.
Why Trade Binary Options?
If you want to profit trading binary options, you need to first understand both their pros and cons. You need to make sure binary options will suit your trading style, risk tolerance, and capital requirements.
There is a whole host of attractive benefits to trading with binary options. The greatest advantages have been outlined below.
- Simplicity – Because you are making a determination on only one factor, direction, your bet is straightforward. The price can only go up or down. You also don’t need to concern yourself with when the trade will end, the expiry time takes care of that. Whereas in other markets, you may need a system to limit your losses, such as a stop-loss.
- Fixed risk – Trade stocks, gold, and crude oil and you’ve got a vast number of factors to contend with, from slippage and margin to news events and price re-quotes. With binaries, your risk is kept to a minimum with far fewer parameters.
- Trade control – Because you know what you may make or lose before you enter the trade, you have greater control from the start. Trade in stocks, for example, and you have no guarantee that your trade will make the entry price.
- Profit potential – Compared to other trading, the returns in binaries are extremely attractive. Some brokerages promise payouts of up to 90% on a single trade. If you’re looking to make simple trades with large profit potential, binaries could well be worth a look in.
- Choice – Rather than being constrained to a specific market, e.g. cryptocurrency or stocks, binary options gift traders the opportunity to trade instruments across virtually all markets, allowing you start currency, indices, and bonds trading if you so wish.
- Accessibility –In the binary options game, it’s always the best trading hours somewhere on the globe. So, you can login at night, or on the weekends and join the groups of avid traders attempting to turn daily profits. Real-time charts are available for every market so if you’ve got the time you can invest 24 hours a day.
Whilst there are plenty of reasons to delve into trading on binary options, there remain several downsides worth highlighting:
- Reduced trading odds – Whilst you can benefit from trades that offer in excess of 80% payouts, these are often when the expiry date is some time away from the trade date. If the odds of your binary trade succeeding are extremely high you may have to make do with reduced payout odds.
- Limited trading tools – Whilst most brokerages offer advanced charting and analysis capabilities, trading tools for binary traders often fall short of the mark. Fortunately, there are other online sources for these graphs and tools, plus brokers are working swiftly to increase their offerings.
- Price of losing – Your odds are tilted in favour of losing trades. Approximately for every 70% profit, the corresponding loss of the same trade would result in an 85% loss. This means you need a win percentage of at least 55% to break-even.
- Risk management – Unlike other markets, brokers often set a trading floor, with minimum accounts a trader needs to enter the market. This means losing capital can happen with ease. Whilst a stocks broker may permit you to open an account with $250, trading micro-lots, most binary brokers won’t allow $50 trades. So, even with $250 in your account, just five trades that don’t go your way could see you sink into the red.
Binary Trading via Mobile App
How Does Trading Binary Options Work?
Trading binary options for beginners is straightforward. Simply follow the steps outlined below.
Step 1 – Find a broker
This is one of the most important decisions you will make. You need a broker that meets all your requirements and who will enhance your trade performance. But with so many options out there, how do you know what to look for?
If you’re high-frequency binary trading each day, the commission fees and costs will quickly rack up. You want to maximise your profits so look for brokers with a competitive and transparent fee structure, and remember, different asset classes pay out different amounts.
One point worth investigating is rules around minimum deposits. Whilst some brokers will offer binary options trading with no minimum deposit, many will expect a deposit of close to $50, and some $100. A broker offering low minimum deposits is ideal if you’re strapped for cash. Trading binary with JC and GCI are good choices if you’re looking for low deposits.
Some brokers will specialise in certain assets. If you’re set on crude oil, it may be worth finding a broker that’s geared towards those binaries. You may benefit from relevant news feeds and the most prudent option choices available. Trading binary stocks with 212, for example, is ideal for those interested in stocks.
With scams out there it’s important you check your broker is properly regulated by the relevant financial body, e.g. FCA, CySec, CFTC. Trading with 247 Binary Options, IQ option, and Binary.com are all safe bets.
Binary options platforms are your gateway to the market and where you’ll spend many hours a day. There are now many online trading platforms, so, make sure it’s easy to use and offers all the charts, patterns and tools you need to make smart and accurate trade decisions. For example, will you be trading binary options with candlesticks or more obscure charts?
Both Keystone and Nadex offer strong binary options trading platforms, as does MT4. Before you buy, conduct a thorough trading platform comparison and check reviews.
Any problem could cost you time, and as an intraday trader, time can cost you serious cash. So, check the broker offers reliable support. Some brokers will offer 24/7 customer support through calls, live chat, and in a number of languages. Binary options trading with Etrade and 24 Option are smart moves if you want top quality support.
A growing number of people use mobile devices and tablets to enhance their trading experience. However, software for trading binary options varies hugely. So, it’s worth checking whether your broker offers cross-platform capabilities. Also, check the charting tools you need will work on your iOS or Android device. Binary options trading with IQ Option, for example, offers fantastic trading apps.
Many brokers will sweeten the deal with some useful add-ons. Some may offer free trading plans, courses, and lessons. So, find out first if they offer free courses online to enhance your trading performance. Some brokers will also offer free binary trading trials so you can try before you buy.
You could also benefit from trading bonuses, tips, the best strategy and trading signals reviews, plus free, practice demo accounts. Not to mention some brokers allow for binary options trading using Paypal. However, don’t be put off by no binary options trading deposit bonus, these can be a sign of potential scams.
For newbies, getting to grips with a demo account first is a sensible idea. Funded with simulated money, you can try numerous assets and options. It’s the perfect place to make mistakes and learn before you put real capital on the line. In addition, you’ll find most free binary options demo accounts require no deposit, so you can start practicing whilst you save that initial capital.
There is no universal best broker, it truly depends on your individual needs. Some brokers offer minimum trades of just a couple of pounds, whilst others require hundreds or even thousands. The solution – do your homework first.
For more guidance on making the right choice, see our brokers page.
Step 2 – Choose An Instrument/Market
You can trade binaries in pretty much everything, including stocks, forex, indices, and commodities. You can bet on anything from the price of natural gas, to the stock price of Google. Opt for an asset you have a good understanding of, that offers promising returns.
Step 3 – Decide On An Expiry Time
As a short-term trader, you’ll probably be more interested in 30 seconds, 1 minute and end of day expiry times. You need to balance binary options trading volume with price movement. Whilst the more trades you make means greater profit potential, it’s better to make fewer and more accurate trades. Also, find a time that compliments your trading style.
Step 4 – Decide On Size
In the binary options game, size does matter. The greater your investment the greater the possible profit. On the flip side, remember the entirety of your investment is on the line. You need an effective money management system that will enable you to make sufficient trades whilst still protecting you from blowing all your capital.
Step 5 – Choose An Option
You will have any number of the options outlined above to choose from. Think carefully about how confident you are in your determination. Consider factors that will jeopardise your investment, and select an option that gives you the best chance of succeeding. Don’t automatically select a ladder trade because you want huge returns, consider which options are the relatively safe bets.
Once you’ve made that decision, check and confirm your trade. Then you can sit back and wait for the trade payout.
Below is a video explaining how to trade binary options on the platform of a leading provider:
Binary trading strategies will differ from trade to trade. What may work for a ladder option in forex, may prove useless in a range option on gold. Having said that, there are two reasons you must have a strategy.
Firstly, a strategy prevents emotions interfering in trade decisions. Fear, greed, and ambition can all lead to errors. A strategy allows you to focus on the maths and data.
Secondly, a strategy allows you to repeat profitable trade decisions. Once you’ve found out how and why that binary option worked, you can replicate it to create consistent profits.
Building A Strategy
There are two crucial elements to your binary options trading method, creating a signal, and deciding how much to trade. The second is essentially money management. How do you go about determining these two steps then?
Step 1 – Creating A Signal
The signal will tell you in which direction the price is going to go, allowing you to make a prediction ahead of time. The two main ways to create signals are to use technical analysis, and the news.
Charts, Patterns & Indicators
If you can identify patterns in your charts, you may be able to predict future price movements. They rest on the idea that ‘history repeats itself’. You can start trading binary options using Heiken-ashi, other candlesticks, and line charts. Armed with charts and patterns, successful traders will build a strategy around their findings.
You can then build indicators into your strategy, telling you when to make a binary option, and which binary option you should go for. These technical tools can prove invaluable, so make sure your broker offers the features available to conduct thorough market analysis.
One of the great things about trading binary is you can use any number of your normal indicators, patterns, and tools to help predict future binary options movements. So, you can start trading with/using:
- Support and resistance levels
- Price action
- Stochastic oscillators
- MACD indicators
- Options close to expiry
For more detailed guidance, see our charts and patterns pages.
You can trade binary options without technical indicators and rely on the news. The benefit of the news is that it’s relatively straightforward to understand and use. You’ll need to look for company announcements, such as the release of financial reports. Alternatively, look for more global news that could impact an entire market, such as a move away from fossil fuels. Small announcements can send prices rocketing or plummeting.
If you can stay in the know you can trade your binary options before the rest of the market catches on. To do that you’ll need to be tuned into a range of news sources. You can browse online and have the TV or radio on in the background. Some of the most useful news sources in terms of trading information are:
- Yahoo Finance
- Business Insider
- Financial Times
Step 2 – How Much You Should Trade
If you’re just starting off it’s often best to keep things simple. Trading the same amount on each trade until you find your feet is sensible. Below are 3 binary options trading strategies for both beginners and experienced traders.
Binary options using the martingale trading strategy aim to recover losses as quickly as possible. To do this you’d trade larger amounts of money in the trades following a loss. So, you’d set an amount that you trade each time, say $250. However, if you lose on that $250, you’d bet $500 on the next trade. If the trade wins, you’ll already be back in the black, rather than being stuck around the break-even mark.
The problem with this strategy is that if you go on a losing streak you can lose a serious amount of capital in a short space of time. So, only use this strategy if you’ve got a relatively accurate means of making trade decisions. If you’re still in the trial and error stage, consider a different approach.
A percentage based system is popular amongst both binary options traders and other traders. The idea is you specify a percentage you’re willing to risk. Between 1-2% is common. So, if you’ve got $10,000 in your account, and your risk value was 2%, you could trade $200 on a single trade.
If you have a greater risk tolerance and consistent results you may want to increase that risk margin to 5%. The benefit of this system is that you should never lose more than you can afford. This makes it an ideal approach to take if you’re new to trading on binary options.
This example is best employed during periods of high volatility and just before the break of important news announcements. This technique can be utilised by traders of all experience levels. It gives you the capability to avoid the call and put option selection, and instead allows putting both on a specified instrument.
You aim to utilise put when the value of the instrument has risen, yet you think that it’s going to decrease soon. Once the descent has begun, place a call option on it, anticipating it to bounce back swiftly. You can also do it in the reverse direction. Simply place a call on the assets prices low and put on the rising asset value.
This significantly increases the chance of at least one of the trade options producing a profitable result. If you’re in a volatile market, this simple system could you see turn handsome profits. This works well as a binary options trading 60 seconds strategy, and will also cover expiry times of up to one day.
Bots & Algorithmic Trading
Once you have honed a strategy that turns you consistent profits, you may want to consider using an automated system to apply it. These robots usually rely on signals and algorithms that can be pre-programmed.
The bots then do all the leg work, trading options on your behalf. The plus side is they can make far more trades than you can do manually, increasing your potential profit margin. They can also trade across different assets and markets.
It’s worth investigating your brokers offering when it comes to auto trading and checking for robot reviews. Many allow you to build a program with relative ease. You can use your own entry points that rely on Bollinger bands, RSI/MFI patterns, and moving averages.
However, even when you’ve got your system up and running, you can’t go into trading binary options on autopilot, you need to stay tuned in. If any mistakes take place, you need to be there to remedy the problem. Technical crashes and unpredictable market changes can all cause issues, so stay vigilant.
Many binary option strategies pdfs fail to sufficiently consider time variables. Certain strategies will perform better with specific time options. You may want to look specifically for a 5-minute binary options strategy. Alternatively, trading 15-minute binary options may better suit your needs. So, whichever strategy above you opt for, ensure you take time into account.
Summing Up Strategy
Trading binary options with success rests on finding a strategy that compliments your trading style. So, consider the instrument you’re going to be trading. Then, employ an effective money management system and use charts and patterns to create telling indicators. Also, utilise news announcements to your advantage.
If you’re trying a new fence, gap, hedging, or any other binary strategy for the first time, why not try it on a trading practice account first? This will allow you to address any issues before you invest your own money.
For more detailed guidance, see our strategies page.
Binary options trading 101; immerse yourself in educational resources. As Benjamin Franklin asserted, ‘an investment in knowledge pays the best interest’. The top traders never stop learning. The markets change and you need to change along with them.
To do that, utilise some of the resources detailed below.
- Books & eBooks – There is a whole host of books and ebooks out there that can impart invaluable information on day trading binary options. You can benefit from the binary options trading knowledge of experts with decades of experience. The good thing about a book it is allows you to learn at a pace that suits you. One book that has made binary options trading easy is ‘Trading Binary For Dummies’, by Joe Duarte.
- Video tutorials & seminars – Engaging and easy to follow. There are numerous online video tutorials out there that can walk you through making a trade. With seminars, you’ll also be able to have questions answered and the binary options trading basics explained, plus some brokers offer weekly seminars to keep you up to date with market developments.
- PDFs & instruction guides – These will give you a clear breakdown of steps that you can follow and apply. The best part is you can find plenty online that are totally free and easy to download, whether you’re using Android, Windows, or iOS. The trading binary options ‘Abe Cofnas’ pdf is particularly popular.
- Forums & chat rooms – This is the perfect place to brainstorm ideas with binary options gurus. You can benefit from recommendations and learn in real-time whilst investing in your binary options. You can also swap live chart screen grabs to get a feel for other binary methods and tactics.
- Newsletters & blogs – These are brilliant for keeping up to date with upcoming developments that may affect your markets. Plus, you could hear about binary options competitions (yes, they really do exist).
- Copy trading – This is when social trading networks/platforms are combined with binary trading tools. You can follow experienced traders, analyse their strategies, and then replicate their trades. Check out copy trading reviews before you sign up.
All of the above will play a key part in your binary options trading training. Free trading videos and examples will help give you an edge over the rest of the market, so utilise them as much as possible.
There currently exists no binary options university. So, explanations as to why that option didn’t work can be hard to come by. Keeping a journal with all your binary option trading results in could solve that issue. A detailed record of each trade, date, and price will help you hone your strategy and increase future profits.
Whether you keep it an excel document or you use tailor-made software, it could well help you avoid future dangers. As an added bonus, it can make filling in tax returns at the end of the year considerably easier. A journal is one of the best-kept secrets in binary options, so now you know, use one.
Trading binary options successfully isn’t just about having the right strategy. If you can’t control your emotions you will make costly mistakes. As Robert Arnott stated, ‘what is comfortable is rarely profitable’. When the pressure kicks in, fear and greed can distract you from the numbers.
You need to accept that losses are part of trading and stick to your strategy anyway. If it’s based on accurate maths and careful technical analysis then you have to keep your faith. As soon as you start acting inconsistently your profits will suffer.
As the popularity of binary options grows across the world, regulatory bodies are rushing to instill order. That means where you trade and the markets you break into can all be governed by different rules and limitations.
If you’re day trading binary options in the UK, for example, you will require a license from the UK gambling commission. If you opt for a broker regulated by the Financial Conduct Authority (FCA), you’ll be guaranteed an extra level of protection. Beware some brokerages register with the FCA, but this is not the same as regulation.
Brexit has brought with it complications to trading regulations. The MiFID II guidelines were set to be implemented across Europe enforcing rules around binaries, however, the UK may not now implement the guidelines. This means the UK is no longer under pressure from Europe to reclassify binaries as financial instruments.
Binary options trading for US citizens is limited by a choice of just two brokers. Nadex and CBOE are the only two licensed options. Fortunately, they are both huge firms offering competitive prices and a range of different assets to trade binaries on.
Rest Of World
In Australia, the Australian Securities and Investments Commission (ASIC) runs the show. If you’re interested in brokers based in Cyprus and Israel, then check they are regulated by CySec. In Dubai and the rest of the UAE, binary options are regulated by the Dubai International Financial Centre (DIFC).
You can also start day trading binary options in Canada, India, Pakistan, South Africa, Malaysia, Kenya, New Zealand, Nigeria, Vietnam, Indonesia, and the Philippines. Each has their own regulatory bodies and different requirements.
So, if you want protection, ensure you do your research before you sign up for a binary broker on the other side of the world.
Another important regional distinction comes in the form of taxes. Some countries consider binary options as a form of gambling, such as the UK. This comes with notable benefits. The HMRC will not charge you any taxes on profits made through binary options. However, in the future binaries may fall under the umbrella of financial derivatives and incur tax obligations.
Having said that, if day trading binaries are your only form of income and you consider yourself a full-time trader, then you may be liable to pay income tax. Whilst you are probably still exempt, it is worth seeking clarification.
Outside the UK, tax regulation differs hugely. Binary options in Japan and Germany come with vastly different tax obligations, for example. So, before you start trading seek advice to ascertain whether you’ll be exempt from tax. If not, will you pay income tax, capital gains tax, business tax, and/or any other form of tax?
For more detailed information, see our taxes page.
Can Trading Binary Options Make You Rich?
Although exciting and dynamic, to make a living trading binary options you’ll need to use this page and other sources as guides. Can trading binary options make you rich then? Done correctly, yes it can. There is no question of binary options potential profitably, this is evidenced by numerous millionaires. To get there though, you’ll need the right broker, an effective strategy, and you’ll need to invest in your trading education, by utilising the resources outlined above.
Are binary options legal?
Yes, but regional regulation varies.
In India and Australia for example, binary options are legal.
In the US, binaries are available via Nadex, and perfectly legal.
In the EU, binaries have been withdrawn for retail investors, but it is still possible to trade binary options legally, by professional traders. Certain criteria need to be met in order to be classed as ‘professional’.
Can you trade at weekends?
Yes. There are two ways to trade at weekends. Firstly, forex markets are still open in some parts of the world during the “weekend” in other parts. Binaries can be traded on forex during these times.
There are also ‘synthetic’ markets with some brokers (such as binary.com) but traders should note there is no underlying market with these options. They are ‘virtual’ markets created solely to cater for traders looking to trade anything at all. They are not for sophisticated traders.
Are binary options banned in Europe?
Binary options have been withdrawn for retail traders by the European regulator, ESMA. Brokers not regulated in Europe may still offer binaries to EU clients.
It is also possible for EU traders to nominate themselves as professional traders. This waives their rights to regulatory protection, and means binaries are free to be used again.
Some synthetic markets can also be traded by EU traders, and while the product works exactly as a binary options, they are referred to slightly differently.
Do binary options work on MT4 or MT5?
There are no binary options brokers offering Metatrader integration. It is however, possible to perform technical analysis in MT4 and place trades on a separate trading platform.
Can you use binary options on cryptocurrency?
Yes. The leading binary options brokers will all offer binaries on Cryptocurrencies including Bitcoin, Ethereum and Litecoin. As a derivative, traders will not “own” any cryptocurrency, they will purely be speculating on the price. This does mean however, there is no need for a Crypto wallet or crypto account.
Binary Options Brokers Comparison
We provide a powerful tool that allows you to compare binary options brokers by minimum deposit, account currency, regulation, deposit and withdrawal methods, software provider and trading assets.
What Are Binary Options?
Binary options are a fairly new trend which is quickly gaining popularity, especially among novice traders. The reason for this is the simplicity of binaries – this unique trading tool is simpler and much easier to predict. Of course, trading with binary options doesn’t necessarily mean easy money, but beginners will certainly appreciate the idea behind trading binaries.
In short, binary options are an interesting trading product which provides the trader with much more detailed information regarding the potential losses and gains. Binary options are often referred to as all-or-nothing options, because this is exactly what they are – you either get your payout or lose the money you invested. The best thing is that you’ll know how much money you are going to win or lose before placing the trade, so traders can easily calculate the risk they are taking.
In order to trade binary options, you have to predict whether the price of an asset will rise up or go down below a certain level. Another thing you should know about binary options is that they have specific expiration times that depend on the binary options broker you are using – some brokers offer daily, hourly or even 15-minute expiration terms.
As it was mentioned earlier, the biggest advantage of binary options trading is that you have pre-determined potential losses and gains. Another good thing about binary options is that you don’t have to take so many things in consideration when making your trade and the reason for this is the simple prediction you have to make – vanilla options must be predicted carefully, and they are riskier, because the losses and gains are infinite while in the meantime, trading binary options gives you complete control over the amount of money you’ll win or lose.
Let’s take a closer look at binary options trading and see some of the more specific things about this trading tool. When you place your trade, you can choose between two options – Call and Put. If you choose the Call option, then you expect that the asset’s price will rise before the expiration time, and if you pick the Put option, then you are predicting that when the contract expires, the price will be lower than it was when you placed the trades. Keep in mind that unlike vanilla options, binary options can’t be resold before the expiration of the contract, so once you open the trade, you can’t go back.
Binary options trading can be executed with the help of four main classes of assets – stocks, currencies, commodities and indices. Of course, each one of these classes consists of many assets and it is up to you to choose which one best suits your trading style. There are many online communities that discuss binary options trading, so you have access to tons of information regarding this trading tool. There are also many binary options trading strategies, tutorials and tips available online, so don’t hesitate to dig deeper and find the information that you need. In the next part of this post we’ll tell you how to trade binary options.
How to Trade Binary Options?
Before you start trading binary options, you need to find a binary options broker/operator that suits your strategy, budget and requirements. Later in this post we’ll talk about different binary options brokers, their advantages and disadvantages, bonuses, extras, etc. so don’t worry about this topic – you’ll learn everything you need to know about binary options operators in just a few minutes.
Let’s imagine you have already picked a binary options broker and created your trading account. From now on you have two choices:
Invest real money and trade with them
Trade with fake money until you get familiar with binary options trading and the trading platform that your broker uses
We strongly recommend opening a demo account and using it for several days or even weeks, before you switch to a regular account. The reason for this is that you need to get familiar with all the features and extras offered by the trading platform which you’ll be using from now on. Keep in mind that demo accounts are a great way to test different trading strategies and to learn about some of the important aspects of binary options trading.
Trading binary options is much simpler than trading vanilla options, because you have two choices – you can either put your money on a Call option or on a Put option, depending on your prediction. As we mentioned earlier, putting your money on the Call option means that you think that the asset’s price will be higher when the contract expires. The Put option is the exact opposite – you think that the asset’s price will have gone down when the expiry time comes.
The trading process varies depending on the platform used, but in most cases you’ll be able to place a trade with just a few clicks:
Pick an asset
- See the “Return” that the broker offers
- Choose the length of the contract
- Pick a “Call” or “Put” option
If you complete these 4 simple steps, then you have already placed a trade and now you have to wait for the contract to expire. In the mean time you can follow the asset’s price and see if your prediction is on target.
Of course, when you trade binary options you have access to the same graphs and tools that Forex traders use to make predictions. However, as we mentioned earlier, your prediction doesn’t have to be so accurate – you just need to tell if the asset’s price will go up or down. In the meantime, Forex traders have to accurately predict the magnitude of the price’s movement and how long it will last. Now that you know more about the trading process, it’s time to learn how to choose the best binary options operator.
How to Choose the Best Binary Options Operator?
Thanks to the rapid development of internet technologies over the past two decades, we can now access thousands of things from the comfort of our own home. One of the best things about the Internet is that you can make money from it and what better way to make money than to trade binary options? In order to trade binary options, you’ll have to pick a broker that meets your needs and requirements, and in this part of our post we’ll familiarize traders with the most important characteristics of binary options brokers.
Binary options operators are quite different from Forex trading operators, because of one main reason – they don’t need to be regulated. In fact, 95% of binary options brokers are unregulated, but this doesn’t mean that they aren’t trustworthy. You can find thousands of different operators, but just a small fraction of them will be regulated and in most cases these regulated brokers will be located in Cyprus and regulated by Cysec. Some of the most reputable and popular binary options are operators are unregulated, so don’t worry if the broker you’ve chosen isn’t regulated.
Reviews and Ratings of Options Brokers
Unfortunately, you can’t check the financial condition of a binary options broker, but you must do a little bit of research in order to find out whether your broker has enough money in capitalization in order to keep itself in the business. In the past many people lost their money due to using the services of binary options brokers who had just $100,000 in their banks. These money are far from enough to support a binary options broker, so don’t forget to check the capitalization of the binary options operator you’ve chosen.
The next thing you need to keep in mind is the trading platform used. Different platforms come with different features, but nowadays almost all platforms have the extras that most traders use. For example, one of the most popular and widely used platforms is MetaTrader 5, and there is a very good chance that the broker you’ve chosen uses this trading platform. Some brokers may operate with more than one platform in order to provide their clients with the best trading experience. You should also check what your broker offers in terms of compatibility:
- Web based trading platform
- Non-web based trading platform
- Mobile trading
Mobile trading platforms are quickly gaining popularity and it is an undisputable fact that nowadays almost everyone uses a smartphone. Binary options brokers that support mobile trading are becoming more and more popular, so definitely check whether your broker offers this feature.
Two of the most important things you should check are the payouts and assets that your binary options broker offers. In the ideal case, your broker will support all types of assets, but in some rare cases, brokers will only allow you to trade binary options by using just commodities or just currency pairs. We advise you to stay away from such brokers.
The payouts that the broker offers are also important and in most cases they’ll vary between 60% and 70%. However, some binary options brokers offer payouts up to 85%, so with a little research you may find a good deal!
Last, but not least – check the payment methods which your binary options operator supports. Usually, brokers allow you to deposit or withdraw money via a wide range of payment methods such as debit/credit card, bank transfer, PayPal, Skrill, etc. if you can only use a specific payment method, then make sure that the broker you’ve chosen supports it. Some brokers offer bonuses for your initial deposit, but you’ll be able to read more about these bonuses in the next chapter of our article.
Binary Options Bonuses
Bonuses weren’t so popular among traders and brokers until a couple of years ago when several binary options operators tried to attract more clients by offering special bonuses for their initial deposit. Since then, more and more brokers have adopted this approach and do their best to attract new clients by offering them special bonuses. Keep in mind that these bonuses may seem attractive, but you must always carefully read the terms & conditions related with them. The reason for this is that in many cases brokers will set special requirements which you must meet in order to withdraw the money you’ve won via your bonus, but we’ll talk about this later.
As you probably already know, there is a minimum amount of money you can deposit in your trading account. This requirement is different for every broker, but in most cases you won’t be able to invest less than $150-$200. When it comes to trading binary options, there is also a minimum limit on the amount of money you can use to place a trade, so take a look at the requirements your broker has set.
Trading bonuses are a great way to increase your bank balance, especially if you plan to invest a smaller amount of money. For example, a trader looking to start trading with just $500 will welcome the opportunity to increase his balance to $1,000 by taking advantage of the initial deposit bonus. Take a good look at the bonuses offered by your broker – some operators offer a 100% bonus to your initial deposit, but this bonus only applies for a certain amount of money. For example, some brokers will give you a bonus up to $2,000, so if you have already chosen a binary options operator, make sure you check the terms of the bonus they offer.
Keep in mind that there is a reason why these bonuses are called ‘trading bonuses’. You can’t withdraw the money you get via this bonus unless you use them to generate a certain amount of trading commissions. In most cases, brokers will require you to generate trading commission equivalent to the bonus in order to be able to withdraw it, but in some cases you may have to generate trading commissions greater than the bonus itself.
In short, bonuses are a great way to boost the amount of money you have in your trading account. They are offered by just about every broker, so it is up to you to find a bonus offer that suits your requirements. Just remember to always check the amount of the bonus and the requirements you have to meet in order to withdraw the money you generate by using the bonus.
Binary Options Payouts
This is the thing that every binary options trader wants to know – what determines the payout and how is it calculated. The answer is quite simple – every broker offers different payouts, but in most cases the payout for trading via the Put/Call options will vary between 60-80%. As we mentioned earlier, one of the huge advantages of trading binary options is that you’ll know how much money you can make with the trade before putting your money on “Put” or “Call”.
Calculating your profits is easy as long as you know the max payout that your broker offers. For example, let’s say that you are trading with an asset that offers a winning stake of 75% and you put $1,000 on a Call option. You’re prediction turns out to be correct, and the trade closes in your favor, so how money will you receive? The answer is simple – $1,000 + (75% of $1,000). So the total payout for this trade will be $1,750.
Keep in mind that different types of binary options will have a different payout ratio. As we mentioned earlier, the payout usually varies between 60% and 80%, but in some cases you may come across lower or higher rates. Keep in mind that if your broker offers a payout below 60%, then you might want to re-consider using their services, because you can easily find a better offer. On the other hand, if your broker offers payouts above 80%, you should take a look at the company’s reputation, because there are many fraud schemes that involve binary options operators offering high payouts.
Some binary options brokers offer two types of payouts – you can either request a full payout or a smaller one that includes a refund in case your prediction goes the wrong way. For example, the regular payout of a certain broker may be 80%. However, the broker also offers a “Refund” option. In this case, if you win you’ll receive a payout of only 65%, but if you lose, you’ll get a 15% refund. It is up to you decide whether you’ll risk all your money aiming for a bigger profit or if you’ll play it safe and save some of your investment in case your trade doesn’t go well.
Some brokers offer the so called High Yield Options which can offer you a profit percentage of up to 500%, but keep in mind that trading via this option is more complex and riskier. High Yield binary options come with many restrictions which are put there in order to protect the binary options operator. This is why you should stay away from them unless you are very experienced and knowledgeable.
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Choosing trading scheme for successful binary options trading
The choice of strategy for each trader by binary options has always been one of the hard and painful issues. Each novice stumbled on this obstacle many times in a row. An experienced trader can sometimes be difficult to make a decision too. To connect a trading asset with a strategy is a task that requires a lot of patience and effort. All difficulties will usually await you at the beginning of your journey to the world of earnings on binary options. Now in 2020, there are a lot of different types of trading strategies, as many that eyes can easily run away. How to find the strategy we need, how to determine exactly the strategy that we need. In this article, we will try to help you with choosing a successful binary option trading strategy.
To evaluate the trading strategy of binary options, it is enough for newbie to take 3 main factors. This approach to evaluating strategies can be used both in forex and in traditional trading. On what factors will need to navigate this year, read more in the article.
Learning to choose a profitable binary options trading strategy
Trading strategies for binary options are considered to be one of the most difficult and difficult to perceive. But, sometimes it happens and the biggest misconception for all novice traders. Strategies are of varying difficulty. It, in turn, can be determined by the level of perception and preparation of the trader. Each trader is interested in the profitability and risk level of a strategy. Using the 3 main criteria, you will be able to learn how to choose trading strategies for your level of training, character, manner of trading binary options. Let’s not hesitate, we will consider these criteria:
The percentage of successful transactions in the strategy
This indicator is of a statistical nature, it reflects the ratio of successful transactions to their total number for a specific strategy. Each strategy will have different values вЂ‹вЂ‹of the indicator considered by us. But not always a large percentage of successful transactions will indicate high profitability. In this case, one should also take into account the level of risk that can cause a loss of capital.
Do not forget about the existence of different types and types of binary options. Applying the same strategies to them can give you different results. When trading different types of options and applying different strategies, the probability of successful transactions can be quite high. For example, when applying strategies for trading high or low options, the probability of a successful transaction will be higher than when trading and applying strategies to ladder options. But the profitability in the case of staircase options can be significantly higher with the lowest level of winning trades. So the profitability of your chosen type of binary options and your strategy is determined by many factors.
When choosing a trading strategy for binary options, you need to consider your psycho-emotional factors. Since their control will affect your trading, then the profit will depend directly on them.
- Try to select strategies very carefully, not hurrying up
- Remember your character traits
- Analyze how your perception reacts to different situations
- Study and test
- Do not be afraid to make mistakes.
- Do not be afraid to start trading
Observing simple rules and systematizing knowledge of binary options trading will give you the opportunity to become a successful trader.
Almost all strategies are more or less successful. But not always the best and successful strategy will bring profit permanently. In this case, many traders are always in search of an optimal strategy. The optimal strategy is considered to be one that a trader is able to adhere to for a long time. To some, strategies with a more stable level of profit will work, but to someone more risky strategies, where the profit will be much higher. Patience plays a very important role in this matter.
When choosing a strategy, it is important to focus not only on the method of making a profit. First of all you need to consider your personal qualities, character and style of trading. After all, you and only you will trade.
Calculating the average profitability of your chosen strategy
With such a calculation, it is important to consider the probability of successful transactions for a particular strategy. As we found out earlier, strategies with a high percentage of successful trades have lower profitability. Strategies with a low percentage of successful transactions have higher profitability. The lower the number of successful transactions on the strategy, the higher will be its profitability. This rule will make sense in most cases. These 2 different types of strategies attract completely 2 different types of traders. Some of them are accustomed to getting a profit from trading to a lesser extent, because they can not accept a number of not successful trade deals. Others are willing to show patience and wait for their lucrative deal. These 2 types can be combined in one trader. This case happens when a trader is gaining experience and can conduct risk diversification, applying this or that approach at the right time.
The main factor in this case is the psychological aspect. You decide for yourself the type of binary options trading that is acceptable to you. Can you tolerate losses and get a big profit or will you have a small but steady income.
Your decision must be weighed. Do not make it based on copying the trade of other traders. You need to be honest with yourself. Only in this way you will be able to choose the desired style of trade, which is right for you. It will never be superfluous to test both styles on a demo account from a trusted broker. This will help you to determine much faster.
Let’s count all on examples:
We have a strategy whose yield is between 67% and 63%. In order to obtain a mathematical expression for the probability of a successful transaction
(0.67 + 1.00) * 0.63 = 1.0521.
67% – adding income
1,00 – our initial investment
0.63 – percentage of successful strategy transactions.
If we take the second strategy, then let its yield be 210%, and the probability of winning is only 20%. In this case: (2.10 + 1.00) * 0.2 = 0.62. This strategy has a winning frequency lower than the previous one. But comparing our indicator of the mathematical expression of the probability of a successful transaction, we can compare their effectiveness.
The most important point at this stage is the choice of strategy. Choose you can any of you suitable. But, you should know about the optimal trading strategy for binary options. The optimal strategy is a strategy that a trader can use constantly. In other words, it is a strategy that will not cause feelings of tension in the trader.
Frequency of trading transactions
The frequency of trading transactions is another important factor in the selection and use of a specific strategy. This indicator shows us the right amount of time, which is required for 100 deals. Recall that the mathematical expectation shows you how much we can in positive or negative positions after 100 deals.
All these factors have a direct connection with your personal qualities.
Strategies may have differences in the frequency of transactions. The frequency of transactions can be different. In this case, it can show you how many transactions a month this or that strategy provides. But, we must remember that this indicator does not guarantee the nature of the transactions themselves. Whether they are profitable or not.
The indicator only demonstrates the rate of trade, which may or may not suit you. It all depends on how you will be more comfortable to conduct trading operations. How much time do you have to trade. And, of course, will you sustain this rate of binary options trading morally.
You need to remember your funds when you start trading binary options. Plan them ahead of a particular strategy.
In this article, you have learned some more useful ways of trading binary options. As you have already seen, everything needs to be adjusted to the maximum for yourself. It is necessary to act very carefully, so as not to lose the initial investment. Try to carefully build a plan for trading binary options in the context of all the information you have. You need to do a self-analysis of your personality component. After all, this factor will play the biggest role in selecting all the subsequent components of binary options necessary for trading.
All binary option trading strategies can make a profit. But only in that case, if they are compatible with you, your trading style and other qualities that are unique to you.
Test the strategies, add the elements you need to them. Feel free to experiment with different strategies for trading binary options.
вЂњGeneral Risk Warning: Binary options trading carry a high level of risk and can result in the loss of all your funds.вЂќ
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