Considering that the internet was only introduced to the world in 1991, the technology is catching on rapidly! Already, billions of people are connected to the World Wide Web, and that number is only growing. This amazing availability has brought about innovations in virtually every sector, and especially in the financial sector.
Binary options trading was introduced to the world in 2009 due to the demand of internet users who wanted to trade the financial markets from the comfort of their own homes. The binary options trend, like the internet, has caught on like wildfire.
All across the globe, people are learning more about how to trade stocks, indices, commodities, and currencies with nothing more than a simple internet connection and a computer.This form of trading is slightly different than the classic method of buying and selling large amounts of shares. In binary trading, your role is merely to predict the direction that the asset will move in, either “up” (a.k.a. “Call”) or “down” (a.k.a. “Put). The trader also needs to choose an expiry time, and the amount of cash he would like to place on the trade. If he chooses an expiry time of 5 minutes, for example, than what’s important is the asset price at the end of those 5 minutes.
The simplicity of binary options trading is what makes it so attractive to new traders. The trader knows from the very beginning how much he stands to gain or lose if he wins, or loses, the trade, respectively.
A binary options trade can be done on as little as $1, and traders who want to practice their skills are invited to do so at their own pace. If the trade is in-the-money, the trader reaps rewards of between 70% and 91% on his investment. If the trader sees that he’s making many winning trades, he can increase his investment amount per trade to as high as he pleases, and the percentage of profit remains the same.
The methodology of a binary options trader is very similar to the methodology of any other trader out there. The basic strategy is to follow the financial news, such as data releases relating to anything from industry, and manufacturing, to consumer confidence reports, and specific earnings reports from the world’s biggest companies. Binary platforms offer traders the opportunity to make huge profits by correctly predicting the direction that Facebook, Apple, Tesla, or McDonalds, share prices will move in. For example, if the financial news reveals negative performance of these companies, traders can quickly take a “Put” trade predicting that the price will move in a downward direction.
Let’s talk for a moment about diversification. This has long been a popular term in the world of finance. It means that, instead of putting all your money on one asset, you diversify your investments, and spread your cash into a variety of different assets. This is also known as “spreading your risk,” and in binary options trading, this strategy is incredibly affordable. Most non-binary trading platforms will charge you commission, or a set fee, on every trade you wish to make. Binary options platforms don’t, and this has added to the popularity of this form of trading.
When choosing a binary options platform, there are several things you should take into account. Firstly, try to find a broker who will provide you with high-quality educational content. For example, many brokers will invite their users to educational seminars streamed live on the web (a.k.a. “webinars”).
Secondly, it is helpful to find a binary company which offers users a helpful account manager. Account managers have access to financial analysts whose job is to constantly monitor the markets, and get a feel for which direction an asset is moving in.
Thirdly, many binary companies will also offer users trading signals, sometimes at an additional cost. Trading signals are often generated by technical analysis computer programs which analyze the previous patterns in price movement, so as to predict the future direction of an asset.
In summary, binary trading is becoming increasingly popular amongst people all across the world that wish to trade the financial markets from their home computers. Trades can be made quickly and easily, on the world’s hottest assets. By following the financial news, and choosing a broker that can help you make winning trades, you, too, can profit by joining the binary options revolution.