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Your Starting Guide to Binary Options
Have you ever wondered what the term “binary option” means?
If you’ve looked into online trading and financial investment before, then the answer is probably “yes.” Usually, the term “binary option” refers to a kind of trading term, where you get a fixed payout by predicting the outcome of a trade from two potential results. It’s a bit like flipping a coin. If you’re right about whether heads or tails will come up, you’ll receive all the money agreed to. If you’re wrong, then you lose the stake you made on the option, and that’s it.
The reason that binary options have their name is that there are no extra possibilities that might happen. Either you win, or you lose – it’s that simple.
What are the Benefits of Binary Options?
The most obvious benefit of trading with binary options is that it’s incredibly simple. There’s a basic yes or no proposition to consider – and that’s all. Binary options for trading are also very flexible. They allow you to trade in a range of markets, including Forex, commodities and indices, and a variety of market conditions.
With binary options, you’ll also be able to choose between a short-term or long-term trade window, with durations that last anywhere between 10 seconds and a whole year. While your losses are limited by the initial stake that you place into the trade, you can earn huge payouts, up to tens of thousands of dollars.
Which Is The Best Trading Platform For Binary Options?
Whenever you start a specific kind of trading, you’ll often need a broker or an application to help you. In the binary world, there’s a popular option called IQ Option. This award-winning platform for binary trading is designed to help you explore the ins and outs of binary trading with ease. It’s a simple and intuitive platform that’s easy to use, and very accessible. You should be able to open an account and begin your trades within minutes. Other benefits of IQ Option include:
- Privacy and security – trade with confidence, knowing your personal data, funds, and transactions are secure.
- Patented technology – trade with a pioneer in the industry, and a holder of patented technology.
- 24/7 availability – trade whenever you want – even if it’s on weekends.
- All conditions and markets – you can trade commodities, indices, currencies, and more in a range of different conditions.
- Long or short-term durations – choose a timeframe that suits your risk strategy.
- Competitive pricing- Get the prices that are benchmarked against your specific needs.
- Transparent risk and reward – When you trade in any kind of binary marketplace, you can rest assured that you’ll know how much you can stand to lose or win before you use your money.
- Protect your cash – You can sell your contracts on Binary.com before they expire. This reduces your risk of losses.
- Two-way pricing – get your quotes for countertrades and trades at the same time, so you never have to worry about bias clouding your judgment.
Whether you’re brand-new to trading binary, or you’ve been in the market for a while, the IQ option website can be an excellent way to expand your wealth. With a deposit of as little as $5, you can start trading whenever you like, and choose your trades based on your own insights. There’s plenty of flexibility with this platform, with millions of trade various to choose from. You can also customize your trades according to your risk-reward campaign. You can read the full review of IQ Option here or just check the special requirements for IQ Option UAE users here.
How Do You Trade Binary Options?
If you’re new to trading binary options, you might be wondering how to get started.
The good news is that it’s easier than you might think. To begin with, all you need to do is choose the market that you want to trade in, the type of trade you’re interested in, the duration of the trade, and the payout you hope to get. Once you’ve entered your position into the binary.com platform, you’ll get prices based on your situation. From there, you can just redefine your position or buy your contract.
Defining your Trade Position
Trading in binary begins with identifying the basic outlines of your trade. You’ll need to adjust a few basic parameters to get a price for your contract. For instance:
- Choose your market from a range of Forex, Indices, commodities, and volatility indices. There are plenty of sub-options within each of those four available markets so that you can further customize your trade.
- Choose your trade type: Do you want to predict if the market will fall or rise from its current level, or hit a price target? Maybe you can determine whether the market will stay within or go outside of a specific price target.
- Select your duration: Next, you need to choose the length of your trade. On Binary.com, this can be anything from 10 seconds to a year.
- Pick your barriers: Finally, determine the boundaries of your position so you can figure out the kind of payment you’re going to receive.
From here, you can choose the payout that you want to try and get if you correctly predict a contract.
Getting your Price and Making your Trade
Once you’ve outlined your position on the Binary.com platform, your contract price would be automatically calculated by the patented pricing tech on the system. The price is based around the parameters that you outlined previously. The prices are also benchmarked against the interbank options market. You should be able to rest assured that you’re getting the most competitive prices.
When you’re happy with the price that you’ve been given, you can simply carry out your trade. The platform you get will make it easier to complete your trade without any risk of slippage. Importantly, Binary.com doesn’t come with any hidden fees to worry about either.
What Kind of Markets Does IQ Option Covers?
As mentioned above, binary options allow traders to trade on a range of different markets. One advantage of trading binary options is that you don’t buy or sell an actual asset. You only buy a contract that suggests how that market will perform over time. This reduces your risk. The markets available on Binary.com are:
- Indices – Stock indices from the OTC market
- Forex- Major and minor pairs (and smart FX)
- Volatility indices – synthetic indices
- Commodities – all precious metals and energy
Indices allow you to trade stocks with real-time pricing and charts. The indices from Binary.com are sourced from the OTC or over-the-counter market, outside of centralized exchanges.
Volatility indices might be a bit more obscure for some traders. These are synthetic indices that mimic the behavior of real world stocks in the market. They’re based on a cryptographic number generator, that’s audited by a third party. You can trade these indices on all three main trade types, and there are two classes available – continuous indices, and daily reset indices.
For those interested in sticking to the markets that they already feel familiar with, Forex is often a good option. With Forex, you can trade on contracts about minor and major currency pairs, as well as smart forex indices. There are four smart FX indices available on Binary.com, including the GBP index, USD index, EUR index, and AUD index.
Finally, the other option you can consider are commodities. Binary.com offers the option to trade contracts an all four of the most common precious metals, including palladium, silver, gold, and platinum. There is also a list of energy options available too.
What Kind of Trades are Available?
If you’re worried that you won’t be able to get the right kind of trade on IQ Option, don’t panic. The system offers a range of market environments, including:
- Up or Down trades – these include Rise/Fall trades, or Higher/Lower trades.
- Touch/No Touch – Here, you just determine whether the market will reach a target during your chosen time period.
- In/Out: Here you have two options, Stays Between/ Goes outside indicates that the market will either stay inside or go outside of two price targets. On the other hand, Ends Between / or Ends Outside will predict if the market stays inside or goes outside of price targets in a contract period.
- Digits: You can predict the precise decimal digit of a spot price with digits. The three options available include over/under estimations, even/odd or matches/differs.
- Reset Put/ Reset Call – The two kinds of reset trades are reset call, which predicts that the market value ends up higher than the current level, or reset put, which predicts that the market will end lower than the current level.
- High ticks/ Low ticks – These contracts predict the highest or lowest tick within the next five ticks to enter the market.
- Ups/Downs – You can choose between only ups, and win a payout if consecutive ticks rise successively, or only downs, and win when the ticks fall consistently.
Are you ready to start trading binary options? If so, IQ Option could be the best place to go to begin exploring the opportunities of the binary trading world.
