Binary options as a permanent income. Myth or reality

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Binary options as a permanent income. Myth or reality?

Today binary options occupy the highest positions in the rating of online earnings tools that are available to ordinary people. However, despite a lot of successful examples of traders in this market and a relatively simple and understandable trading mode of the tool in the network, there are many skeptics who consider this resource another means of deception. Given this, we decided to analyze the topic of earnings on binary options and understand the myths of this regime of income generation.

So, in order to fully understand the doubts of potential investors in binary options, it is necessary to analyze a set of basic myths and real facts that are present today in this issue. Basically, when studying materials on the topic of trading options, you can meet the following statements that lead to users denying this field of activity:

• What is a binary option

Despite the relatively long period of options in the market, many still can not understand the classification of the trading instrument. This, in turn, causes a negative attitude towards the service among traders. Yes, indeed, at the dawn of the appearance of options as a trading instrument, it was positioned as a derivative of classic vanilla options. However, the growth of the professional level of private traders and a deeper study of the algorithm of the work of the instrument on the part of professional analysts of the financial market led to the fact that this trade contract began to be attributed completely to other areas and ways of generating income. In particular, today many users attribute binary options to the form of a betting bet! And in this there is some truth. Let’s see what a binary option is.

First of all, the binary option is a completely new tool for working in the online mode, which has the features of many technical services for work on both the financial and the bookmaker market. First of all, it looks like a classic fixed-term contract – a valuation option. Here, as in a standard trading tool, you need to use the liquidity indicators of certain financial instruments to make a profit. However, when trading standard exchange contracts, the profit of envy from a wider range of indicators is the time of purchase and sale of the option, the level of change in the value of the asset at the time of the trading position, the cost of selling the contract. In a binary option, everything is much simpler – only a bet on the growth or fall of the asset and a certain period of work of the position in the market. At the same time for this type of contracts there is a set of fixed indicators: unprofitability and profitability – this is not in classical exchange instruments!
The second point is the presence in the binary option of signs of gaming rates. Everyone knows that we do not buy contracts or assets when trading options, but we only make rates for the growth or fall of quotations. As a result, with a positive expiration of the trading position, we get either profit or loss. At the same time, we note that brokers do not take your bets to the market, and you essentially do not participate in trading, but play against other clients of the operator. Thus, really binary options refer to gaming facilities.

Having signs of exchange contracts and gaming services for profit, online option rates are difficult to position as a trading tool – this raises doubts among users.

However, this does not mean that you can not make money on this. About this a little later.

• Binary options are a means of deception

This opinion, as unfortunate, has the right to life. The fact is that at the time of entering the market of the binary option, a lot of companies appeared who were trying to simply deceive their partners. They used the new tool of earnings as a means of deception, which caused a very great reputation damage to the resource. In this respect, unscrupulous brokers used a lot of techniques:

– The banal theft of clients’ funds, since this market did not have regulation and supervision from state and other bodies, companies could independently manage the funds of clients who were at their full disposal
– Technical manipulations with trading charts. Since customers conduct their operations on the market with the help of broker platforms, they can create any conditions for trading, including profitable ones. So often there were moments of impulse movements of the market, which were formed by operators artificially – this led to trading losses of traders.
– Impossible conditions for verification. This technique is used to create conditions in which a trader simply can not withdraw funds, and is forced to continue trading until the loss of his capital.

This is just a small list of techniques that are available to brokers to deceive their customers. However, today such companies are rarely found on the market. The reasons for this are banal.
First, traders today have more information about the work, both the binary contract itself and the market operators. The growth of the professionalism of investors and the widespread use of option trading have made it possible to get rid of fraudulent platforms.

Secondly, binary trading today is recognized as the main regulator of the market, and companies operating in the market received licenses. In these conditions, it is almost impossible to deceive a trader, as regulators clearly follow all trading processes on the brokerage platform and have many ways to punish the company for fraudulent activities.
Third, it is competition. The popularity and large financial resources that are present in this field of activity have allowed safe and professional operators to become large brokers of binary options and drive out small scammers. Today it is simply not profitable to cheat partners – it’s easier to make money on their own mistakes.

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  • Binarium

    Best Binary Options Broker 2020!
    Good Choice for Beginners!
    Free Trading Education, Free Demo Account!
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  • Binomo

    2nd in our ranking!

• Psychology of the user

The last reason for the skeptical attitude to binary trading, as a method of obtaining a stable income, is the direct attitude of users. The problem is that potential traders treat trading as a regular computer game, and do not seriously consider this activity as a source of basic income. It is a frivolous attitude to trading is the reason for the failures of many investors.
In addition, during the time of the general availability of the Internet, a variety of ways of deception appeared on the network, so most of the citizens are very cautious about innovative income resources. As an example, we can recall the history of crypto-currencies – this investment tool at the dawn was considered another bubble, and today it is regarded as one of the most attractive assets.

Thus, binary options during their career as a means of earning overgrew a lot of myths and opinions that prevent traders from making the first step to success. But is it possible to consider binary options as a means for stable earnings?

How to make money on binary options?

So, for stable earnings in the binary market, first of all you need to discard all doubts – this technical way of generating income can really bring you to the financial Olympus – and do not listen to anyone, it’s better to understand everything yourself. If you clearly decide to link yourself to option trading, we offer you a simple instruction that will open the way for you to successful traders of the binary market.

1. Choose a reliable trading partner

To maximize the use of all the possibilities of binary trading, a broker with a high level of security, a good reputation and the most professional trading platform is needed. When choosing a potential trading partner, you need to pay attention to the following points:

• The broker has a license of the regulator. In this regard, do not pursue companies with international licenses or regulated bodies of other states. Select operators with work permits from national market authorities
• Financial terms of cooperation with the operator. In this respect, not only the level of minimum investment in trading is important. Of course, you, as a novice investor, it is profitable to start with a minimum amount. But here you need to know that option trading is not a safe business in terms of possible losses. Therefore, when studying the terms of trade, pay attention to the relationship between the level of capital and the value of options. This in the future will allow you to properly manage risks and equity in the process of trading – optimally the ratio of 1 to 10
• Level of equipment of the trading platform. To bet on financial quotes and get a stable profit, you need a certain tool for forecasting the movements of trading quotes. Therefore, the terminal of your trading partner must have a large and diverse equipment with technical means of market analysis. It is also worth mentioning the choice of financial assets for trading, the possibility of using statistical tools to assess market indicators, as well as the overall index of comfort on the platform.
• Verification and banking. We have already said that verification was used by operators as a means of deceiving traders. Today, confirmation of identity is a requirement of regulators, so everyone will have to pass it. In this issue, you need to study the immediate requirements of the broker to the client – professional operators usually establish a simple verification mode. In addition, study the methods of financial settlements with the operator – the period for which the funds of the trading account are displayed and credited, available payment services.

Having chosen a trading partner, we proceed to the next stage

2. Training

Yes, to earn, you need to learn how to do it right! Do not worry, the whole process will take you a little time. Today, the bulk of professional brokers offer excellent conditions for obtaining both basic theoretical knowledge of option trading and practical services for gaining trading experience. Usually everything is based on interactive manuals, instructions on different topics, video lessons, webinars of professional traders and demo platforms.
Even the basic knowledge of trade and the principles of market analysis will allow you to significantly increase the chances of success in trade. You will be able to clearly understand and determine favorable conditions for placing bets, get a technical arsenal of tools for forecasting the market, learn how to correctly calculate risks, and of course you will be able to study the work of trading platforms without investing funds and try your hand at earning in the binary market.

3. Choose a strategy

The main problem of stable earnings in the binary market is the receipt of trade statistics, in which profitable contracts will be at least 65%. So you can steadily increase your equity and get a positive financial result. To solve this problem, there are various technical strategies that use a variety of market patterns, technical tools and forecasting techniques for arranging profitable contracts. In this regard, you can use the systems presented on broker platforms or on the network.

An important point – every strategy before the practical application should be tested and scrupulously studied. Thus, you can not only get acquainted with the system and understand the principles of its work, but also get an opportunity to assess its efficiency and efficiency when trading in different market conditions. Having tested and studied the system, you can proceed to direct trading and obtain a stable profit.

Summarizing the article, it is worth saying, binary options as a permanent earnings – this is not a myth, it’s a reality! With the right approach to trade, a clear understanding of all the processes of work at the terminal and the market, the use of effective and professional strategy and disciplined management can achieve very high results. At the same time, the stability of making profits can make binary trading your primary means of generating revenue.

“General Risk Warning: Binary options trading carry a high level of risk and can result in the loss of all your funds.”

Myths about binary options trading

The popularization and widespread development of private online trading resulted in the emergence of a network of myths associated with trading in the financial market and, in particular, with binary options. The Internet is a free information space, so the birth of false opinions is widespread here. Against this background, many potential investors find it difficult to understand what is real and what is fiction. Today we offer you to understand several basic myths of binary trading, which will undoubtedly help you to assess the potential of this area of ​​financial detail.

The first myth: binary options is a scam!

The bulk of non-professional traders and all sorts of home-grown “experts” say that binary contracts that are offered on the network are an illegal tool aimed at divorcing users for money. Such statements cause serious reputational harm to binary options and become an obstacle to the path of potentially successful traders. Of course, losing money here is real and, probably, this is the reason for the negative opinion of traders, but on what do they not lose money? Deception is present in all spheres of human activity. If you understand the facts, it becomes more and more clear and understandable.

First, binary options are a legal instrument of financial online trading, which is used by many brokers and financial institutions to make a profit. Yes, the binary option algorithm raises some questions: it uses a fairly primitive method of generating revenue in the form of a standard betting bet that is exactly limited in time:

But this does not mean that this tool must be attributed to gaming. No, this is a format of an exchange contract, adapted for the work of online investors.

Secondly, binary options are regulated by a huge number of state institutions that oversee not only this type of contracts. It turns out that “experts” do not quite understand what they are talking about and mislead the bulk of traders.

Summing up the subtotals, binary options are not a divorce, but a way of making a profit in the financial market, which can lead to high results.

The second myth – all brokers deceive customers!

The problem of loss of investment funds grew along with the popularity of the trading tool. As soon as investors paid attention to binary options as a way of quick enrichment to the market, scammers came out as well, who tried to make money on frivolous market players and newcomers who did not understand anything in trading yet. This is quite natural, because large-scale finance attracts unscrupulous elements! But today there are few platforms where they engage in frank deception and this is facilitated by the activity of market regulators and the growing experience of traders of binary options.

To this myth does not become your sad reality, it is enough to choose the right trading partner to work in the market. Here are a few simple and affordable recommendations:

– We choose a company with a marketing license, preferably a national regulator
– We work with brokers who provide a professional and technically functional trading terminal
– When choosing a partner, we are guided by broker ratings and reviews in the network

A simple example is the brokers from our TOP 3, which today are considered the safest and professional trading platforms for options. These operators of the market offer high-quality trade services for partners, safety of investments of clients, provided with regulators, occupy high positions in specialized ratings and have an excellent professional reputation. Cooperating with these brokers, you will not run into problems and will work in the most comfortable conditions.

Hence the conclusion: deception on broker platforms up to a certain point was a reality, but with the introduction of market regulation and the professional growth of traders, deception in option trading becomes a myth and an extremely rare occurrence!

Myth three: binary options – it’s difficult!

Perhaps, this is the only myth of binary trading, which has the right to life. Indeed, option trading is not an easy task, despite advertisements and various professional recommendations. Trade in binary contracts is connected with forecasting movements of quotations of financial assets, and no matter how simple the option is, it is the definition of market trends that is the main problem! In addition, in trading options are purely statistical risks that lead to a loss of funds. Against this background, we can say that trading options is difficult! But this can only speak non-professionals. Specialists and experienced investors know how to make trading stably profitable and simple occupation.

To do this, you need a few simple things that can be characterized by such a list:

– Market evaluation strategy. A set of forecasting tools, options for processing options.

– Financial discipline. This is necessary to curb the excitement of the trader and reduce trading risks in the trading process

– Psychological stability. To follow the first two recommendations, the investor needs to be calm and balanced, and most importantly – to clearly assess their potential in a specific market situation

Binary options are a simple way of earning money, but only for experienced and professional investors. However, this does not mean that a beginner can not succeed here: if you follow the rules of trading and work on the strategy, the financial result is a regularity, and not an exception!

“General Risk Warning: Binary options trading carry a high level of risk and can result in the loss of all your funds.”

Common Misconceptions About Binary Options

There are many misconceptions about binary options, so it is important that traders understand exactly what they are–and are not–in order to use them effectively.

Here’s a look at some of the more common misconceptions.

Binary Options are Just Gambling

At least on the surface, binary options are structured just like a $100 bet on a football game: You buy the team you like or you sell the team you don’t. A binary is just a simple yes/no trade. The yes trade means you agree with the binary statement—that the market will reach a certain level before expiration, for example—while the no trade means you disagree. The pricing of the binary is between zero and 100 throughout the lifetime of the option.

Unlike football where the underdog will receive odds, the binary has a multitude of strike prices that have a variety of fixed odds.

If you buy a binary priced at 20, there is a low probability of it paying off. Your cost is $20, while your potential profit is $80.

If you sell a binary priced at 20, then there’s a high probability of it paying off. But your cost is $80, while your potential profit is $20.

You can trade binaries on stocks, futures, foreign currency and ETFs as long term investment and or flip them as a speculative short term trade.

Binaries can also be used as a hedge just like standard put options. The difference with binaries is that your potential loss is limited, you can have a very short time horizon and your payout is either all or nothing.

Binary Options May Be Bought But Not Sold

As you look at the various strike levels of a particular binary option, you’ll see the similarity to call options. As a binary buyer, you’re bullish about the underlying market. The binary at expiration is valued at $100 if underlying market finishes above the strike so the various strike levels will draw similarity to in the money, at the money and out of the money call options as to the relationship of the underlying to binary strike. The at the money binary will be priced around 50 and the pricing is limited to the trading range of zero to 100.

You will not find the binary option chain for the puts. To sell a binary you are taking the opposite view, you’re bearish the underlying market and think it will finish at or below the strike at expiration. So to sell a binary, you go short the binary at the trade price.

Remember that the binary contract is fully collateralized.

AUD/USD >.9140 (3PM) traded at 28

Binary Buyer: is long at 28 trade price and his cost is $28 per contract.

Binary Seller: is short at 28 trade price and his cost is $72 per contract.

Fully Collateralized: buyer cost $28 + seller cost $72 = $100 Expiration payout

You Are Required to Hold Until Expiration

Binary options are not buy and hold contracts until expiration. At any point prior to the expiration, the binary position can be offset to cut your trading losses or lock in an early trading profit. When you initiate the binary position, your initial trade cost is your maximum exposure, so you’re either long or short the binary at the binary trade price. In a long binary position, you want the price to rally to 100, while in a short binary position you want the binary pricing to sell off to zero.

Binary Options are Not Regulated

Many binary options that are traded over the counter outside of the US are not regulated.

In the US, there are three exchanges, regulated by the CFTC, offering binary options trading, Nadex being the first and largest for retail traders.

Binary Options are Not Transparent

If you are trading binary options on a regulated exchange, you will be provided accurate and up to date time and sales data on all bids, offers and trades throughout the trading session. That’s because the exchange is simply matching buyers and sellers on every trade.

Binary Options Requires Enormous Capital

All binary options are priced between $0 and $100 and the minimum amount to open an account with Nadex is $250. Since you are never trading on margin, your account always needs to have sufficient funds to cover the initial cost of the trade plus trading fees.

With binary options, the maximum risk and the potential profit are clearly defined to the terms of the trade assuming a favorable expiration payout. To trade on Nadex, the initial cost is a fraction of the leverage markets on which the Nadex products are based.

Best Binary Options Brokers 2020:
  • Binarium

    Best Binary Options Broker 2020!
    Good Choice for Beginners!
    Free Trading Education, Free Demo Account!
    Get a Sign-Up Bonus Now!

  • Binomo

    2nd in our ranking!

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