Binary options trading – is one of the fast growing types of trading. The number wishing to try their forces on this new financial instrument grows in the geometrical progression. Approximately the merged deposits are growing with the similar speed and in the identical quantity. If you don't desire to join harmonious columns of unfortunate traders - study this section attentively.
The theory of binary options trading
For realizing how to trade on the binary market it’s necessary to learn what it is foremost. People with various level of qualification come into trading and what is clear for the experienced trader can’t be clear for the beginner. It’s a closed book for him. Where through we won’t delve into the specifics of tricky phrasing and try to take out the simplest formula and show it as an example.
Binary options - it’s the particular kind of transaction, which affords the trader to earn stock returns specified in advance by the predetermined time.
The quite simple picture of trading disappears under this while knotted determination. It's necessary to specify for the trader whether the cost for the asset with which he plans to work, will turn out higher or lower than its current value by established time. Respectively, in the event of the right forecast the trader gets profit which is specified in advance. Everything is simple!
How it happens on practice
The trader needs the trading platform for consummating a transaction. Today there are 50 Russian brokers’ companies at the market which offer the platform for binary options trading. You can look through these companies and the work principles in the section Brokers for details.
Using the platform, The trader can buy options for longing the course or scale trading of any assets (goods, stock items, forex currency pair). The size of transaction is fixed beforehand by the trader and the broker indicates the percentage of draw (typically it ranges from 70 to 90 percents from made rate). Trade essence in the correct forecasting (notice, not guessing, namely... forecasting) is in the assets rate movements.
The sample of the platform - company 24option
- Choice of option type: Modern brokers provide us a good few of binary options’ types among which each trader can choose that type which suits his strategy of trade as high as possible. Generally it is possible to mark the following key types which can be met on the majority of broker platforms:
- "one touch"
Choice of underlying asset: All large traders provide the traders with a big variety of underlying assets types, which it’s possible to buy binary options on. These types can vary depending on broker and the type of the auction itself, but all brokers afford traders to trade currency, stock items, commodities and indexes. Choice of underlying asset is very important moment, because every asset has its own features. You can study out the main underlying assets and its features in details in section Underlying assets.
- Choice of option expiration time: Plotted against the chosen type of the binary option the trader is allowed to adjust time of its expiration, or otherwise, finishing time of the option. As a result everyone can set the certain time of trade finishing. The only restriction-the broker sets the minimum and maximum time within which it is possible to make setup. In certain cases expiration of an option is fixed and isn't taken to setup.
- Choice of the investment amount: Each broker sets limit of range within which it is possible to establish value of the invested amount. Actually it means the availability of the maximum and minimum amount of an investment (rate).
- The choice of the trading direction and the conclusion of contract: any binary option can be bought in two directions: up, if you consider that the market will grow up, or down if you think that the market will decrease.
Forecasting in binary options trading
As binary options are the part of the financial markets, their trade is connected with the analysis of the current market situation. It is possible to turn everything into a fascinating roulette, and spend time hazardously but if the purpose of the trader consists in earning money, he should start forecasting movement of the price, the chosen asset. It is possible to use various tools for these purposes but the following enjoy the greatest popularity:
The fundamental analysis. This type of analysis concerns studying the main macroeconomic indicators which will have the impact on the market inevitably. It's "heavy artillery" in the binary options trading which allows doing high-quality forecasts for long time frames. Works with the fundamental indicators demand the certain knowledge of economic world processes from the trader. You will be able to examine the basic principles and methods of this analysis type in the section the Fundamental analysis.
Technical analysis. This analysis type is more widespread, in comparison with fundamental, and is based on using of the peculiar situations study which arise in the exchange markets. The majority of traders, who trade binary options, rely on indications which are provided by the tools of the technical analysis to them in the work. You will be able to examine these powerful and effective tools in the section Technical analysis.
Carrying out the high-quality analysis of the market situation is impossible without use of the basic principles of the fundamental and technical analysis. Any other mechanisms which don't rely on these analysis types, are inclined to creation the false analytics.
How to learn trading on binary markets
Knowledge and experience are necessary for becoming a professional. Therefore we strongly recommend to beginning traders to leave searches of wonderful strategies, super - indicators and confidential signals. Believe it won't bring anything except loss of money and time to you.
It is much more than advantage of the theoretical approach. In our section Training in Binary Options, you will find a fine selection of object lessons for any level. Begin with an introduction course and constantly raise your level. Almost all information on the binary market is collected in our encyclopedia. Study it attentively and trade in binary options will become not only fascinating, but also profitable occupation.