You can have profit from buying stocks and from waiting for the value of the stock to grow or to decrease, and then to close the binary position. This way, you will obtain a positive difference, meaning that your binary position will be a winning one. The fact that you can trade binaries for one minute and even for one hour allow you to make many transactions during a single day and thereby allowing you to roll the money several times.
How much money can you earn if you trade stocks in binary options?
The possible income of a binary option has been known since the start. When you open a binary position on a pair of stocks, you know how much money you can win. Usually, this is 70-80% of the sum, meaning that you can win $80 with an investment of $100. As you can see, the possibilities to earn some good money are huge, but there are also risks involved.
It is possible to earn $20 000 in a single month starting from an investment of $1000, but this means indulging in risky transactions. For example, you can use the one minute strategy that allows you to buy pairs of stocks 100 times a day, but beware some of those positions may not be winning ones.
What Statistics say?
Simple calculations say that you are allowed to lose one transaction out of three. If you start with $100 and you earn $80, and then you win another one, you have a profit of $160 from two transactions, and if you lose the third one, you will still be a winner overall.
Considering that this $60 can be made in three consecutive one minute transactions, we can say that $60 is a good profit for five minutes work, isn’t it? It is possible to make money from binaries even if you are a beginner, but basing your trading strategy fully on intuition is not a good idea, because it will cheat you eventually.
The money management strategy is the most important one in this case. When you trade stocks in binary options and you are not as experienced as others, a smart method to manage your money will allow you to have comparable results. The money management strategy is something that you should stick to. You are bound to be unhappy when you lose five transactions in a row. But if your money management strategy tells you that you should stop trading for the respective day, then this is probably what you should do.
Trading stocks in binaries is an art. Before starting to trade on a real account, you need to know your qualities and disadvantages. On the demo account, you can overcome your greed, anger and fear, which are the most dangerous enemies for a trader. It is acceptable to make mistakes on a demo account, and this is the platform where you should make those, if you don’t want to make those later, with your real money.
Technical analysis in binary trading
The trading strategies of binary options traders are based on technical indicators. Those try to anticipate the evolution of prices for the next few hours. The traders are not interested about the price of the currency in one month to obtain profits. However, this means that Binary Options Indicators must be used on the short term, and this is difficult especially for beginners.
Making an estimation for the next month is difficult compared with making estimations on the short term. This is why the binary traders prefer the short term positions that are rarely affected by the macro events. What is the chance for the US government to announce bad expectations for the US dollars, ruining your 15 minutes strategy for USD/EUR? You must be incredible unlucky if this happens while you have an opened position on this pair.
When to enter and when to exit
A trader must know how to use the Binary Options Indicators to trade binaries effectively. You need to make the right estimations about the change in currency and stocks trading. If you want to obtain profits, you need to make the right estimation at the perfect time. If you are not able to do this, you will lose some money. This is why you should start with the free demo platforms where you can test your strategies, and you can apply those for real trading only when you are sure that you can master those.
Trading smartly on binaries
It is important for each trader to elaborate his own protection method, and to calculate all the Binary Options Indicators that can affect the position. This is made with a smart money management strategy. If you have a smart strategy of this kind, you will not avoid loses, because it is impossible, but you can be sure that those will be limited in case they appear.
Learning binary trading
The best place to learn about the Binary Options Indicators is the websites that offer this kind of trading, which usually have a training section. Here, you can read about all the indicators, and then, you can use the demo version of the website to try and to test those strategies. There are short and long term indicators, and each one of those is important in a certain way.
For More information about How to trade Binary Options, visit http://www.BinaryOptionsTops.com