A short guide to binary options

Written by Traci Robinson. Posted in Gadgets

Considering the growing popularity of this type of trading, it is understandable why so many people begin to wonder exactly what they imply and how they can be successful in trading them. There are many brokers such as 24Option binary options on the market that people can choose from, but before this, they should know exactly what this type of trading entails. [Not a valid template]

What are binary options?

In order to understand how binary options trading, you would first need to understand how the rest of the trading markets usually work. Normally, in other forms of investment, the investor actually buys the asset he is interested in and hopes that these assets will grow over the next period of time. Naturally, the more this value grows, the more profitable they become. However, if their value decreases, they will lose their investment. With this type of investment, you would constantly need to worry about the price of you assets and when it would be the best time to sell them. With this being said, when trading binary options, you would not actually buy any assets; you are simply trading on the actual market whether or not they will go up or down. This is why many people prefer it, as it is considerably easier to understand and trade.  

How fast is the return rate?

The period of time on which BO trading happen is very small, sometimes even minutes, so you would find out if you have made a profit very fast. Many investors have made small fortunes in just a few hours of trading, but beginners are always advised to take it slow and start by understanding the asset they are interested in trading. While the return rate of this type of trading can be over 80% in some brokers, if you make a wrong prediction you will lose all your investment, so caution is always recommended, especially in inexperienced investors.  

What are the assets that can be traded?

The assets offered can vary from one broker to another, but usually they are 4 main types:
  • Forex: major currencies combined in different ways such as EUR, USD, JPY, GBP and others;
  • Stocks: the biggest and most popular international companies will always be found in the list of assets of a respectable broker. Companies such as Google, Amazon, Coca Cola and others are always present;
  • Commodities: oil, coffee, gold, silver, corn and many more;
  • Indices: FTSE, Nasdaq, Dow jones and others.
 

Are there any educational materials available?

Again, each broker may choose to offer or not educational information to its clients. Do your research properly and choose a broker that offers you everything you need to be successful. Considering there are so many brokers available on the market these days, you should be able to find one that offers you advantageous conditions. The important thing is to take your time and not rush into things. Study the market, the asset you are interested in and only trade when you feel prepared.

Traci Robinson

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