Binary option is an easy and popular way to trade the markets, with no complexities of regular trading. Plus, you do not need tens of thousands of dollars to begin with. It is possible to achieve returns of 60% to 500% within just an hour!

binary options trading tips

We are going to target the simple, fixed-payout binary options made available from brokers including AnyOption, StartBrokers, Binarix and others. We'll use AnyOption within our example, simply because they possess the best payouts of the fixed-payout binary options broker we've found. It is possible to stock trading, indexes and commodities with binary options, but we will concentrate on the foreign exchange market, due to the ready option of free charting packages and technical analysis tools for currency traders.



Inside a standard fixed-payout binary options trade, a profitable trade pays out between 60-70%, while a loss will lead to returning of 15% of the investment. This equals a total loss of 85% of one's investment. A possible gain of 60-70% versus a possible loss in 85% doesn't place the odds into your favor.



However, I will give you an effective hedging strategy that can cause a "profit zone" by having an overall positive expectation. By placing Put (sell) option above a Call (buy) option, it's virtually guaranteed that one or more trade will be profitable. Because of our negative profit expectation, a simultaneous win and loss can lead to a loss of revenue of 15%, while a win will result in an income of 60-70%!



A potential gain of 70% versus any lack of 15% will be a lot better than any loss in 85%! Here is an example of how we can perform this. Let's say we're placing Call option in a uptrend. Provided that the uptrend continues, we'll realize a profit on the expiration time.



But let's say the trend reverses? This is the perfect chance to place our profit zone trade. Simply place a Put option in the direction of the buzz reversal. So long as the expiration prices are above our Call option strike price, but below our Put option strike price, we'll receive an overall profit of 60-70% of our investment.



If one with the trades finishes from the money, we'll visit a loss in 15%, if both trades are similar size. Using these odds, we only must win about 25% in our trades to produce a profit. Without strategy, we'd must win above half of our trades.

binary options trading tips

This setup won't happen all the time, but as long as you always trade in to a strong trend, whilst aware for potential reversals, you need to see an overall profit trading forex binary options.