Trading binary options can be fun and exciting, especially when a broker gives you bonus money to help you get going. So before you start trading and wanting to make your mark as an online trader, lets look at 3 things that you want to know about binary options.
1. Receiving Bonus Money
A broker will usually give you an option to receive bonus money when getting started. As an example, lets say you deposit $100 into your trading account. The broker could match your $100 and now have $200 to trade with. Although this sounds great, make sure you read the rules of how bonus money works. Most brokers will have a stipulation where you might have to do “x” amount of trades before you can withdraw that money. Remember you don’t have to take the bonus money, if you don’t want it.
2. Binary Options Are Fixed Return Options
On any given trade, you will always know what your return is going to be if you win that trade, and if you lose, you know what amount you lost. Brokers usually have a fixed return rate between 70%-90% on all winning trades. For example if you have a $100 trade and win with a 70% return, you will receive $170, with a $70 profit. If you lose the trade, you lose your $100.
3. All Binary Options Have A Strike Price And An Expiry Time
A trader picks an asset, and then chooses which direction it’s going to go (call option means it’s going up, and a put option means it’s going down) at a certain time. That time is going to be your strike price. When your trade is over, it will have an expiry time. This can be different time frames ranging anywhere from 60 second trades, 5 minute trades, to 5 hour trades.
Remember to take your trading seriously. You will not become an over night success when you first start. It sounds easy to pick a direction, put your money down and win, right? Not necessarily. Most brokers will give you a demo account for free to practice your trading before you use real money. Practice your trading, and learn how to read trends when you are looking at your charts. Most importantly, make sure you do your research and have a balanced appetite for risk, when it comes to trading binary options.