Skip to content

binary-option-trading-basics-and-tips

Welcome To Our Beginners’ Guide To Binary Options
Welcome to BinaryTrading.org’s New Binary Traders Guide. This page explains binary options basics you should know before trading. This page should be bookmarked for future reference. Here’s what you’ll learn.

 

Binary option

Binary trade types

Tips

Wanted:

Know-It-Alls

Exchanges

Launching

Binary options Themselves

Binary options are simple, fixed-risk contracts. Binary options have a “one or the other” decision and payout after expiration. Up or down, or touch/no-touch are options. Binary signifies 1 or 0 in computer coding.

[scg html rbox marketsworld]

From the trader’s perspective (yours), you pick whether an underlying asset (stock, commodity, currency, etc.) will rise or fall in a specific period. This is a bet. You’re told how much you’ll win if your guess is right. Your stake and money are lost if your forecast is inaccurate. You get your risked money back plus a profit if you forecast right. Returns are 70-85%.

 

One hour from now, you think gold will cost “$1612.75” more. The successful transaction yields 80%. This concept is worth $100.

 

In an hour, the option contract expires and is evaluated as a “win,” “loss,” “in the money,” or “out of the money.” Gold reaches $1613, as projected. You get your $100 back plus 80%, or $80, for $180 total. Despite gold’s little increase, you still earn 80%. Price swings don’t affect your return.

 

Binary Trade Ingredients

All binary option contracts have these three important components. Expiration, strike price, and payouts.

 

Duration

Price Target

Payment

The expiration date is the time between when you “purchase” an option and when it expires. 60 seconds to a month. Most traders trade 60-second to 30-minute binary options.

 

The strike price is the price you might join the trade at, and it affects whether you win or lose. The strike price is $1612.75. Gold has to close above this price to win this trade.

 

The payment offer is the broker’s return. In the gold transaction example above, winnings were 80% and losses 0%. Some deals recover up to 10% of losses, although this varies by broker and trade. Before betting, the payoff is known.

 

Options binary

Multiple binary options are tradeable. The most typical transaction is Up/Down. Learn about binary options here.

 

Intro to

Basic binary option methods will help you make higher-probability transactions.

 

Useful Tools

 

As more trading tools become available, I’ll expand this area. This article reviews binary trading signal services.

 

Binary Trading Facts

You grasp binary options basics. Before diving in, remember these things:

 

Your trade risk is limited.

$10 trade minimum

Losing transactions cost you money (or the majority of it)

It’s risky. Invest just what you can afford to lose with a broker. Dangerous!

You never own the underlying asset; you “bet” on its price fluctuation.

Long-term success requires winning most deals.

Up/Down is just one form of binary option; there are many others.

Easy-to-use binary options trading.

You only risk what you invest. Before trading, you know your payoff. A binary options trade wins a predetermined sum of cash. “Binary options” refers to the two possible outcomes.

 

bbinary-gold-bo-600

Choose Up or Down, Risk, and “Apply” on a binary trading interface.

 

Call or Put

Think “xprice “‘s will rise or fall? Banc De Binary’s screenshot above shows the current gold price. Gold “x”. The green line shows gold’s price fluctuation. This binary option can be traded till the red portion on the right. After that, trade ends. If you’ve traded before, your trading window is over.

 

“Call” if you think “Gold” will rise.

 

If you think “Gold” will fall, you “put.”

 

That’s it. Binary. If you choose the appropriate choice among the two you win the transaction. Mistakes cost you the trade. Two choices. “Up or down.” Win or lose.

 

That’s binary trading for beginners. It’s that easy on purpose. Before clicking “apply,” your refund is specified. If you finish ‘in the money,’ you’ll earn 72%.

 

“X” can be any asset. It’s a stock, gold, or oil price. It’s a currency pair or Facebook’s stock price. You pick the underlying asset.

 

The simplistic depiction above left omitted the option’s expiration date. The trade expires then. At this stage, the underlying asset’s true price is established, and you learn if you finished the deal “in the money” with a win or “out of the money” with a loss.

 

Choosing ‘up, or call’ and the price expiring higher wins. Expiration periods range from 60 seconds to hours, days, and weeks.

 

2021’s Top Binary Brokers

Here are our top binary options brokers. Each broker on this list provides incentives, easy trading interfaces, and more. Choose one to confidently trade binary options.

OptionsIQ

IQ Option has top-tier CySEC regulation. They provide binary options with up to 95% profits. Start trading for $1 or setup a free trial account with $10,000 virtual money. IQ Option offers binary options, FX options, digital options, forex currency pairings, and over 250 CFDs from commodities to cryptocurrencies.

Trade binary options safely with IQ Options.

RaceOption

RaceOption, a prominent worldwide binary broker, has a great trading platform. With cutting-edge technology, you can enjoy nonstop trading, fast withdrawals, and speedy execution. RaceOption’s $250 minimum deposit and $1 minimum trade size are great for newbies. Bonuses, sweepstakes, and promos are available.

Join RaceOption to trade quickly.

Binarycent

Binarycent’s trading platform offers options, FX, and CFDs. With $250, you can open three account types. Each account has a deposit bonus, fast withdrawals, 24/7 support, and a demo. Trades start at $0.10 and the broker promises 95% returns.

Binarycent offers a 100% bonus.

ExpertOption

ExpertOption serves clients in 48 countries. With a mobile trading platform, you may access over 100 assets anywhere. ExpertOption provides six accounts, including a $10 Micro account. The broker’s social trading platform lets you analyse VIP transactions.

Join 50,000,000 ExpertOption customers

Binary Trade Example

A binary trading example is easy to describe.

 

Example Trade 1: High/Low Google Stock Binary Option

 

google-stock-600

Google Finance Price Screenshot

 

You may anticipate Google to trade over $672.10 by 3:30pm EST today. A binary trade is a theoretical bet.

 

google-stock-candlestick

Google’s candlestick chart from FreeStockCharts.com

 

Above, FreeStockCharts.com’s Google candlestick chart. You can read price activity and discover trading opportunities.

 

traderush-google-600

TradeRush.com’s Corresponding Trade – Risk $1000, win $1700, lose $100 (10 percent )

 

Here’s TradeRush.com’s binary trade: You bet $1,000 that Google’s stock will be above $672.10 at 3:30pm today. If you win, you’ll make 70% and lose 10%.

 

If Google’s stock is trading at or above $672.1 at 3:30pm, you’ll get $1700. This covers the initial $1000 and 70% return ($700).

 

If you’re wrong and the stock is trading below $672.10, you lose $900 (your $1000 investment less the $100 return).

 

$672.10 is the “strike price” in the example. Since you bet up, it’s a “call,” not a “put.” “Payoff” is $700.00. “Expiration date” is sometimes termed “maturity date.” The $100 loss represents a 10% refund on transactions. Not all binary option brokers give out-of-the-money refunds.

 

You might have also bet that the stock’s price will be below a particular figure, a “put.” Google must end below the strike price. Usually a few pips below the call strike price. Brokers decide the price and returns. The trader decides whether to accept.

 

Example 2 – Gold ‘Touch Trade’ Tutorial

Gold 300

Binary options are the best strategy to benefit on gold market movements. To win a one touch deal, the asset must hit the 1 touch price.

 

You bet $100 that gold will hit $1617.40 by 3pm EST.

 

If you win, this deal pays 70%. If you win, you’ll gain $170, including the $100 you staked plus $70 (70 percent of $100 = $70). The broker gives a 15% loss rebate because 70% is low. If you lose, you only lose $85, not $100. This helps counteract the poor victory rate.

 

Gold must hit $1617.40 by 3pm today to activate your trade.

 

Luckily, bad news about the dollar’s worth pushed inflation worries. Gold and oil rose. When the news broke, gold met your goal price. In-the-money deal. You won $170, including your $100 wager and $70 return. One touch options are the 2nd most popular kind of binary trading, however not all brokers provide them.

 

Trade Example

 

goptions-trade-gold-600

Easy-to-buy binary options for gold and oil.

 

Pick an asset. Gold, cash, stock, etc.

Set the option’s expiration date. 60 seconds to a week. 15-30 minute expirations are typical.

Set your risk. $5-thousands

Predict the price’s direction (up or down).

Click “Up or Down” and press “Apply” to view your win/loss payment.

At expiry, you’ve won or lost and get the set compensation given before clicking “apply.”

No matter how much the price changes, you can’t lose more than you risked and gain more than your predetermined return.

Binaries have a one-or-other payment or loss. Most transactions with respected brokers win 70-85%. Losers earn 0-15%. Some brokers repay a proportion of losses, therefore their winning returns are sometimes smaller than others.

 

Option Trading Tips

 

Upfront, fixed risk. You can’t lose more than you invest.

Forex trading leverage can’t burn you.

No’stop losses’ needed. It doesn’t matter if you win or lose 1 pip or 100.

Before risking money, payouts are explicitly mentioned and recognized.

Most of our brokers provide early closing. This enables you close your option at the last minute’s price. Early departure can maximize profit or reduce loss.

Easy trade execution. Choose your asset, risk, ‘up or down,’ and ‘trade now’

These trading brokers average 70-85% returns.

No surprises – Risk and return are listed.

No financial “expert” needed to win.

You never own the asset. You predict the asset’s price.

Your trade is “either/or” (hence binary)

Design simplifies trading

Launching

 

If you know what a binary option is but want to start trading, see our article on how to trade. This website is a binary options primer.

 

Binary Options Online Tutorial

Top Binary Options Brokers

Register with one of our top brokers to leverage your new binary knowledge. These brokers have been tested to be safe, fair, and profitable. Each binary broker is described below. Register for a demo or live trading account once you’ve selected the suitable one.

IQ Option is a top-tier CySEC-regulated broker. They provide binary options with up to 95% profits. Start trading for $1 or setup a free trial account with $10,000 virtual money. IQ Option offers binary options, FX options, digital options, forex currency pairings, and over 250 CFDs from commodities to cryptocurrencies.

Visit our IQ Option review to learn how to trade binary options securely.

RaceOption is a prominent worldwide binary broker with a great trading interface. With cutting-edge technology, you can enjoy nonstop trading, fast withdrawals, and speedy execution. RaceOption’s $250 minimum deposit and $1 minimum trade size are great for newbies. Bonuses, sweepstakes, and promos are available.

Join RaceOption to trade quickly.

Binarycent offers easy-to-use trading platforms for options, FX, and CFDs. With $250, you can open three account types. Each account has a deposit bonus, fast withdrawals, 24/7 support, and a demo. Trades start at $0.10 and the broker promises 95% returns.

Binarycent offers a 100% bonus.

ExpertOption serves consumers from 48 countries. With a mobile trading platform, you may access over 100 assets anywhere. ExpertOption provides six accounts, including a $10 Micro account. The broker’s social trading platform lets you analyse VIP transactions.

Join 50,000,000 ExpertOption customers

Forex For Dummies

Trading binary options is easy. Anyone may win a binary transaction. It’s either/or, thus it’s hard to be incorrect always.

 

Long-term success requires developing your own approach and plan. Win more transactions than you lose to continuously profit. Risk implies you need a plan to succeed. Study our winning techniques and methods and practice with a no-risk trading account. Learn candlestick chart reading to determine price activity.

 

If you want to learn more about binary trading, see our lesson list. Read classes and tutorials. Learn to understand candlestick charts and pick a good broker.

 

Marketsworld offers risk-free demo trading accounts (details within link).

Top Binary Brokers

Binary Options 101

60-second binary options

2021’s most-read Forex reviews

Review Hotforex

Review FBS

Review EasyMarkets

Leave a Reply