What is binary options trading?
Trading binary options trading is a way of simplified, halfway between the classical trading on financial markets and the bet.
Explanation: The classic trading is to buy a financial asset that can be a stock of listed companies, bond, foreign currency, or a lot of raw materials like gold or oil, and speculate on the rise, hoping the sell at lower prices and make a profit. The method is proven, but the gains are generally mild and may take months or years to make big gains, as most traditional financial assets have stable prices. For example, gold has had a rate of change of 12.71% for the year 2011, which is considered a major change!
In contrast, the bet, the casino is to bet an amount on an event on which we have no control in general (a bet on an odd or even number in roulette). However, the gains are then 100% of the amount invested and involved in just seconds!
Binary options are located halfway between the two, since when buying a binary option, we will actually bet on the movement of the value of a financial asset in the short term, all in three easy steps to understand , described below.
Practical example of a binary option trading.
Reading the news online, I read a news and headlines – “AFP: A famous rating agency has downgraded Societe Generale.” So I decided to log on the trading platform of my favorite broker to take advantage of this information and realize a gain on the likely devaluation of the Societe Generale shares.
The binary options trading simply requires achieving the following three steps:
1. I choose a financial asset (eg a share of the Société Générale).
2. I bet on a type of movement (eg, “the value of the Societe Generale shares will decline over the next half hour”), this type of movement is called “binary option”.
3. I put an amount on this binary option (I decide to bet $ 2000 because I am on my shot).
If within half an hour after setting the value of the option Societe Generale fell, I earn a fixed amount set in advance (usually 85%) of the amount wagered, in this case $ 1.700! All in half an hour.
Unlike conventional trading, so I can gain a much higher and much faster, and unlike the game of chance, I have control over my decision since I stay current with economic information an immediate impact on the price of financial assets, all of which are analyzed to know.
If you’re new binary options, you will find our site many articles and general articles about the advanced strategies of binary options trading.
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