Binary option is a part of financial markets that is traded by quite a large number of financial investors throughout the world. What is a binary option? What do you need to know to start making money on binary options? Well, in the financial markets, a binary option is seen as a trading mechanism where the payout is known well ahead of the trading. In other words, the payout is a fixed amount that only depends on your size of investment. Binary options give you the opportunity to speculate and bid on a certain asset by determining whether it will rise or fall at a particular period of time. In order to be successful in binary options, you need to learn basic facts about this fantastic market. Let us examine these basic things you must be familiar with to start making money on binary options trading online!
1. Binary Options Trading Directions
Having described what binary options stand for above, you need to proceed to learn what some traders will call “trading instruments.” Basically, in binary, we use “Call” or “Put“. In BO trading, there are just two outcomes. You can predict that an asset will rise in value at a given time and place a trade that reflects your prediction. This type of speculation is referred to as “Call” option. If at the expiration of the “call” trade you placed and the asset you chose actually rise in value, you win the trade and you get the fixed payout. If it did not rise, that mean you lose the investment. On the other hand, the second outcome you can predict is that the price of the asset will fall. This type of speculation is referred to as “Put” option. If you predict that the asset will fall and it actually fall, you win the trade and the fixed payout will be given you.
2. Binary Trading Platform
In order to start making money on binary options, you will need to make use of the platform provided by BO Brokerage Company. You will find a host of them online if you do a little search. Brokers make available trading platform online that will enable you to participate in the market no matter where you are in the world.
3. Registration and Regulations
Another important fact you need to know is that there are brokers that are not regulated or registered. These platforms do not necessarily keep their clients’ investment in a trust account. It is hard to monitor transactions by a third party and with this, fair play is non-existence. However, some brokers are registered and monitored by third party and one of these regulatory authorities is Cyprus Security and Exchange Commission (CySEC). In Cyprus, a binary options broker should within six months of startup receive a Category 3 Investment Services License and should meet minimum capital requirements. Other countries are following in the footstep of Cyprus today.
4. Assets that Can Be Traded as Binary Options
What you can trade on BO are many. There are Indices that you can trade such as FTSE, Nasdaq, Dow Jones, FTSE, Nikkei, Dow Jones among others. You can also trade currency (forex) combinations such as AUD, USD, EUR, JPY, CAD etc. in addition, you can trade stocks like Coca Cola, Google, Yahoo etc. Or, you may choose commodities such as silver, gold, oil and others.
5. How to Learn to Trade Binary Options
Before you can start making money on binary options, you need to educate yourself on necessary steps in trading. Many brokers provide trading education on their sites and you can also get a lot of free materials online to begin. You can also check our strategies guide in order to get more familiar with binary options trading.
Binary Options Hub hopes you enjoyed these top 5 binary options tips. If you are interested in binary options trading, check out our starter\’s guide and get started!