Online Binary Options Trading
Binary Options are a new and exciting way to trade the financial markets. Prior to the introduction of online binary options trading, traders had to open accounts with brokers offering the currencies, commodities or stocks in the individual markets. So invariably, traders who wanted to trade all these assets had to create multiple accounts to do so. In 2008, an SEC (Securities and Exchange Commission) ruling meant that binary options were no longer limited to being traded on an exchange. Online binary trading was born.
With online binary options trading, a trader can trade currencies, commodities, stock indices and stocks all from one trading platform. Trading online binary options aims to make money from taking a position in one of two possible outcomes. The trader only needs the outcome to be in his favour by just one pip to be able to make money. This is unlike other markets where profits earned are a direct consequence of the trade size and the number of pips gained.
What are the gains that online binary trading has to offer? Why is there so much noise about it in the marketplace?
- Reduced Risk - Part of the appeal of online binary options trading is the reduced risk profile of this market. In other markets, traders have to contend with margin requirements, slippages and other broker or platform issues that affect the market outside the market conditions. In online binary trading, 80% of the traps that hurt all traders are all gone. No more stops, no more bad exits, and most of the bad emotions are gone!
- Flexibility - The binary options market is a one-stop shop to trade financial assets across several asset classes. This means that traders are not stuck in one market. If a market is non-performing, the trader can simply switch to another asset. The trader can also choose between several trade types instead of the regular buy/sell trade mechanism.
- Pay Structure - The pay structure of binary options trading is one that can give the trader magnified returns. For instance, a typical trade with an expiry of 10 minutes can give a trader up to $100. Such a short expiry allows the trader to effect this trade up to 10 times a day if need be. Even a success rate of 7 trades out of 10 would give the trader more returns than if the trader was in any other market. Of course in other markets, it is virtually impossible to get this same rate of return from many trades placed in a single day without taking excessive risk. With payouts of up to 80% on a single trade, the binary options market allows a trader to make profits that outperform profits on other markets when the risk factor to such trades are considered.
- Accessible to All - Online binary options can be accessed by everyone. A typical ECN forex broker will demand $25,000 to open an account. A commodity or options broker will demand even more. Average earners who can only afford small amounts for trading are therefore locked out. In contrast, a binary options trader can start with a much smaller amount, and can gradually build up his portfolio as he gains experience in the markets.
