Get rich schemes and learning how to “traverse the stock market” scams are all over the Internet. Not being aware of what a binary option is and how to trade will be almost like playing craps sexy baccarat where you can lose great sums of money. Trading sites do appeal to those who love to play at online gambling since this type of exchange involves placing bets and hoping for huge payouts. However, dealing in this manner is more respectable than using simple gambling sites. In a nutshell, this type of trading is classified as a form of investment.
You can order an option on almost anything that is traded publicly. Trade in binary options to digital options, Fixed Return Options, stocks, indexes, foreign exchange and commodities. Check out the sites that offer free guides and trading templates.
Purchase a binary option on a platform from a specific investment house and a contract is created. This gives the investor the option to purchase an underlying asset at a determined price and within a precise time. You cannot sell this option before the time period expires.
Most investment sites offer contracts to control risk, or prevent you from losing more than your specified amount. These sites are generally low cost and advertise big gains if you “guess correctly”. You can trade from your home and use a credit card to set up an account. Just like gambling sites, most binary option trading sites have the “edge” over the investor. Verification states that in order to be successful in online this type of trading you must “win” at least 55% of the time to break even.
Trading in options is predicting how much a stock or commodity will rise in a very short period of time. Trading periods can be as short as five minutes. Take for example; you want to trade in a specific product carried by Microsoft. You predict whether or not shares go up or down in the next fifteen minutes. If shares go up, you win; if not, you lose. Unless you have knowledge about the company or a major announcement has been made, pricing is extremely difficult to predict. Follow market trends and historical patterns, but even these studies are not guaranteed.
Take note that web sites for binary option trading are unregulated. There is no securities commission that protects investor interests. Most sites are ethical and protect their clients, but you do need to be aware that just like gambling sites there are unscrupulous operators just waiting for the uneducated to play.
Binaries are another channel investors can use to monetize speculations. As long as the website is ethical and brokers are following the rules, there is no reason investors should be afraid to gamble with these types of investments. Take the advice of brokers and become educated and informed. Use templates from investments sites that do not require actual money until you have become adept at predicting if trading commodities will go up, fall, or remain static.