Before knowing whether or not you can make money with ‘Binary Options’, let’s see what this term is about. A Binary Option is an exotic monetary option in which the payment made is either a certain fixed amount of funds or simply nothing at all. Binary Options are classified into two: the asset-or-nothing and the cash-or-nothing binary options.
Now that you have got some idea about Binary Options, let’s be clear with the fact that: you can make money with Binary Options. Yes, it is certainly possible to earn a consistent amount of profit through binary options trading. The smart traders are benefiting their account balance every day, executing binaries in almost everything starting from gold and oil to currency pairs and stocks.
Scope of Money-making with Binary Options
As mentioned in the beginning, Binary Options is a really interesting website to trade and earn. You get two options: up and down. For sellers or brokers, a Binary Option is like a short or long-term trade.
Binary Options simplify the complexity. You are required to make three decisions: (i) choose an asset, (ii) mention a sum (of money) that you can afford to bet, (iii) decide whether or not the asset value will increase or decrease over the option period. That is all and you are done! Now, tap on the execute button and hold on. You will be upfront informed about whatever your payment ratio will be, especially a 10% rebate if guessed wrong (that means you lose 90% of your invested amount) or a 75% premium on your principal amount on guessing right.
Trading with Binary options means you won’t have to leverage, do risk management, or relinquish the loss orders. No fees or added commissions are imposed either. In this case, your exposure is limited to 90% of your wager. Moreover, you neither have to bother about margin calls nor think over when it’s a perfect time to close a position; which is a typically difficult thing for a beginner to decide. Making a return of about 75% in just a few minutes or hours is also no wonder, only if you have that potential experience of doing so.
How Binary Options Trading Works?
1. Pick the Right Asset to Start the Trade
First of all, the trader has to pick an asset to get started with the trading in the market. This is a strenuous task as Binary Option lets the traders to go through the prices of over 150 monetary assets including forex pairs, indices, stocks, and commodities. The trader must select the assets with sufficient liquidity cum volatility as money-making with binary options happens from price movement. These assets consist of Gold, Oil, EURUSD, and USDJPY.
Right asset selection at right time is the ultimate requirement here. The ideal time for trading different assets is different. For example, USA stocks and indices are fit for doing trade when the stock market of New York is open (i.e. between 1300 hrs to 2300 hrs GMT), whereas Australian and Japanese stocks, as well as currency pairs, are fit to trade (between 0000 hrs to 0900 hrs GMT) when Tokyo market is open.
2. Scout for a News Trading Strategy
Boost profitability while minimizing the trading risks by following the trading plan of a news trading strategy. It is important as the economic data acts as a major catalyst for price movement in the market of Binary Options. Since there is an array of tradable assets in the Binary Options market, one impactful economic data (at least) is released daily that significantly stimulates price movement. Keeping a daily check on the economic data will help you in taking better
movements to earn profit. Economic data tracking also minimizes the risks of losing assets while trading. You can track such data releases via the economic calendars that are freely available on websites like www.forexfactory.com, etc.
3. Expand your Trades
You should deal with a broker so as to get your trading in varied Binary Options contracts. There are different ways through which a trader can do the price movement of their selected assets. Trade diversification will increase your chances of profitability in the BO market. For example, you can trade with long or short-term options, Put or Call options, on platforms like Option.FM, whereas the other available trade contracts in the market include One Touch and No Touch options, Pairs, weekend options, and Ladder options. A trader can earn a huge return of about 500% on each transaction in trade contracts like weekend options.
4. Secure Your Capital
To avoid the potential risk of losing the existing profit that might eventually turn bad, traders must use do in-trade innovative management traits available on platforms like Option. FM to minimize risk exposure and enhance profitability. Early Close is one such in-trade management feature that lets traders exit the bad trades before their expiry. As a result, it decreases the amount of the overall loss and also locks in the profit by ending good trades which may later turn risky.
5. Make Use of Binary Robots and Signals
To make sure that your trade is running ahead and better than others, you should take advantage of binary robots and signals. The binary robots trade only when there is an available opportunity based on what preferences you set. Binary signals, on the other hand, is a service that automatically alerts you when it is the right time to trade (by calling or putting your selected asset). Signals are suitable for those traders who are always on a move and are not able to check on the current market trends to make a proper financial decision. You get the direct notification through your email or on the phone so that you never miss out on the opportunity to make bigger profits. Binary signals are equally effective for both the tenderfoots and experts in boosting their trade with Binary Options.
Here is a simple illustration of trend interpretation, where ADX being Average Directional Index and DI being Directional Index:
|Momentum||ADX Value > 25||ADX Value < 25|
DI+ above DI-
Weak, Unsustainable Uptrend
|DI- above DI+
|Indicates Downtrend||Strong Downtrend||
Weak, Unsustainable Downtrend
An accurate sell or buy position can be decided based on the trend strength and the identified momentum.
You can make consistent profit trading with Binary Option. But, for that to happen, you must strictly follow a stable trading plan and work on it consistently to reduce risks of losing your financial assets and boost profitability in the BO market.