How do the Best Traders Think?

Bill Ackman, the CEO of one of the world’s largest investing firms, has been buying up shares of both Freddie Mac and Fannie Mae. It’s a very interesting choice, especially because these are two companies that focus on mortgage origination.

As you probably remember, mortgage companies suffered in a big way in the aftermath of the housing crash in 2008, but these two companies did survive with government help. Having them in an investment portfolio right now, though, is strange, especially because of the uncertainty that everyone has been talking about with the U.S. economy. If this were what Ackman honestly believed was the case, taking on a risk like this would be too big, especially because his company manages $18 billion in funds. He seems to know something that other investors and traders don’t.

This is one of the reasons why watching the world’s most successful traders can be beneficial. They have a lot more information than we do, and they have the resources to interpret it more accurately. These are people that never make trades without thinking them through, and this is definitely something that Ackman has invested a lot of time and thought into–in addition to his money. We might not understand the reasoning behind it, but that doesn’t mean that there’s not a perfectly valid reason that was acted upon.

Fannie and Freddie did receive major bailouts from the government a few years ago, and are now being heavily regulated and watched over by the U.S. government. However, Ackman has commented that he believes that the government will soon see that less regulation in this sector is better for the country’s economy. If this does happen, he sees the stocks going up as high as $47 per share. What makes this even more interesting is the fact that the stock is currently just above $2 per share. It’s a huge difference in price and it indicates that there will likely be a slow and steady push upward, but over a long period of time.

How do we interpret this information? First, remember that other people–and not just famous and successful traders–have information and experience that we don’t. This can be used to expand our abilities and increase our profits. Second, keep examples like this in mind. Ackman is expecting Fannie and Freddie to increase in price, and they are in a good spot to do so. It might take a while to get to that point, though. You probably don’t have the same need to keep your money in the market tied up like this. But, you can remember that a situation like this one has been set up and you can wait for it to start rolling before you hop onto the trade.If you are looking at a bigger, more popular asset, you can do this without sacrificing profits by using binary options. Otherwise, you will just need to act quickly to avoid losing money by entering the party late. Set watch alerts on your brokerage page to help manage this. Also, subscribing to various news services can allow you to gain more information and stay on top of the things that are relevant for your assets of choice.

This particular trade is very risky. Freddie and Fannie could get huge a gain, but they also could lose even more. However, the housing sector does have more potential to go up than to go down simply because of the growing population in the U.S. If it does work, it could take many years. But that doesn’t mean that the opportunity isn’t there. Spotting things like this and filing them away for later use is a sign of a good trader.

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Selecting the Best Binary Options Site

There does exist both a right way and a wrong way to go about selecting a binary options broker. Furthermore, the wrong selection could prove costly. There are well over one-hundred online brokers in operation at this time, which can make the task of selection seem daunting. However, once you know what you’re looking for, the process instantly becomes much easier.

First and foremost, reliability of payments much be considered. One of the easiest ways to determine whether or not a site is processing profit withdrawals as agreed is to do an online search. Do not stop at only reading reviews, as those can sometimes be biased. Go one step further and read the comments posted in forums and on social media. The occasional misunderstanding is going to take place, but numerous complaints could be a sign of real problems.

The second most important consideration is the trading platform. This is the area in which all trades will be executed. There are several different platform providers, but most brokers choose to go with the more popular providers such as SpotOption and Tradologic. Due to the nature of this form of trading, most platforms are inherently similar. This tends to be a good thing for the trader, because each interface is usually very user-friendly.

While you will want your binary options broker to be providing a straightforward platform, this does not mean that there should be any lack of variety. There should be several trading instruments to choose from, along with a wide variety of expiry times and assets to choose from. A smaller selection will most definitely limit the number of opportunities that you have to earn each day. Such limitation could also lead to losses should you feel compelled to choose from less appealing daily opportunities. Clearly, variety is one of the keys to profiting.

Additional areas of consideration include customer service, educational tools, and supplemental trade features. Customer service should be offered most hours of the day, and should be accessible via telephone and email at a base level. Live chat may also be offered. Do take the time to contact your chosen site before making a deposit. If they are difficult to reach or are not willing to answer all of your questions, you may want to consider taking your business elsewhere.

Educational tools are not of the utmost importance to experienced traders, but they can certainly benefit new traders. Most brokers now provide basic instructions for how to trade binaries, along with instructions for how to use the provided platform. Some even go further, providing videos, webinars, and one-on-one training. In most cases, these things are offered at no cost. However, some do ask for a larger upfront deposit before providing individual training due to the time commitment involved.

Supplemental trade features are elective features that can be used along with live trades. These may provide options such as the opportunity to extend an expiry time, instantly replicate an open position, or exit a trade early and lock in some amount of profit. There is no obligation to ever use these tools, but should you feel that they may benefit you at some point, you’ll need to seek out a broker which is offering them. Do be sure to read the rules for use and find out if there are any associated costs.

Lastly, consider withdrawal fees. These costs tend to be the only costs that traders have to pay. Many sites do offer one or more free withdrawals each month, while others are simply not willing to absorb the cost of processing payments. If you really like what a broker is offering, but note that there are fees to be paid, it may be wise to select that broker anyway. A small fee for withdrawal may very well be worth it if the broker is providing an otherwise stellar binary options trading service.

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Tips for New Traders to Trade Binary Options

From earning a little extra money to making a full time living, or making a lot of money in a short span of time, binary options trading is an excellent way to achieve all of this. As it slowly gains popularity all throughout the world, thousands are making good money with little or no prior knowledge of the subject, however, binary options trading isn’t a cake walk: success can be achieved and risks can be minimized by following the tips mentioned below:

The first and foremost advice to be given to any beginner trader is to select a good binary options broker for your help in this field. A good broker, who knows his work, makes all the difference. There are various comparison websites available to make this choice easier for new traders, so one can quite easily consult these websites and choose a good binary options broker of their choice.

Secondly, it is advisable to increase your knowledge in the field of binary options trading and to know that there is always more to learn. There are training courses available for imparting binary options trading knowledge to new traders. Reading new books on the subject matter and discussing with other traders about the matter also adds to the benefit. This type of trading is a constantly-evolving experience, hence knowledge on the matter is ever expanding.

Thirdly, trading long term serves better returns, and binary options trading is a long term activity. Developing a long term plan for your binary trading and playing the right cards will ensure that you ultimately come out on top. Resist the temptation to get drawn into fads that do not fit into your overall strategies and strictly stick to your drawn plans.

Fourth is to reduce your risks by resisting the urge to over-invest. Beginners tend to get carried away to make that one big score but they must employ some self control as that may be a game changer. New traders lose more money by getting carried away and over investing. Binary options brokers advise to invest not just with courage but also with rational thinking.

Fifth, it is essential to keep a clear head while making any decisions about binary options trading. Beginners should avoid trading when they are emotionally disturbed, as emotions can create havoc with your trading. It is very easy to make the wrong decisions in an emotional state, so it is advisable to stay away from any form of trading until you’ve calmed down and cleared your mind.

Prepping yourself before trading in binary options is the sixth advice. Studying the market and viewing graphs over time can help new traders predict behavior of any binary options asset, thereby helping them to make well-informed decisions.

Another very important piece of advice would be to keep apprised of trading news. Keeping ears and eyes open to catch breaking news about the market condition can get the binary options trader a clear view of current situations, making it easier for him to trade during market crashes. By understanding the root cause for market changes, the new trader can help corner the market when it rallies or crashes.

Hedging trades against each other just ends up decreasing the statistical probability of earning more profits as opposed to increasing them.

Last, but not least, it is very important to have fun while trading binary options. Beginning binary options traders must ensure that it does not become a bore or a drag; if a trader has fun while trading, then he or she will be naturally inclined towards it and will pay more attention and make better decisions, thereby increasing profits.

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List of Trusted Honest binary options brokers: Regulated Binary Trading

You are going to have access to plenty of online Binary Options Broking sites, however you need to be 100% sure that the site you are using offers a trading platform that is reliable and will offer you the exact type of trading options you are seeking.

There are a lot of honest Binary Options Broker around and when checking out any site is it always a good thing to checkout where they are based, if they offer 24 hours a day customer support, and also find out just what other people are saying about them.

Word of mouth is very important in the Binary Options trading world, and if a site is not offering everything they can and should be then word soon gets around!

We are pleased to let you know that all of our listed and rated Binary Options trading sites are honest and reliable, and having handpicked each one of them ourselves and put them to the test we can guarantee that they will offer you everything you are seeking from a Binary Options site no matter when you wish to get online and start trading!

You will also find the mark of a honest Binary Options trading and broking site is one that is fully licensed, and when checking out any site that you may never have come across before find out which licensing jurisdiction has issued them with a licensed to trade!

Trusted Binary Options Brokers

Without doing some research when you are looking to place and trade Binary Options online then you really are at the mercy of some of the poorly run and operated trading sites, with this in mind please do make sure that you have a look around our website for every single site listed has ticked all of the right boxes in regards to what they have to offer their customers and as such are listed as trusted Binary Options Brokers.

Never be swayed into joining up to any Binary Options trading site you come across online for there are many sites that simply offer huge sign up bonuses but fail in every other part of their operation, and as such it is pointless getting a large bonus but then find you have only a limited number of Binary Options which can be traded!

You are never going to find you are limited in regards to the type of Binary Options that you can trade at any one of trusted and listed sites, they offering everything from asset trading to precious metal options trading and will of course offer you plenty of currency pairings if you are looking to trade two different currencies off again each other.

Please do have a good look around as you will not find a bigger or more researched and hand-picked selection of trusted Australian Binary Options Trading sites that those listed and reviewed on our website!
Legitimate Binary Options Brokers

There are many stand out features that you should be looking for from any legitimate Binary Options Brokers and below we have highlighted some of them, when you are in the marketplace for a reliable and legitimate Binary Options Broking site then always stick to those sites offering you all of the below stand out features:

Small and Large Trades: It doesn’t matter if you are a small or large Binary Options trader, you should look for a site that lets you trade any volume of Binary Options, those sites offering a diverse range of purchasing limits are often those offering the best levels of service.
Multiple Payment Options: You do not have to be forced to just use one form of payment option when you are utilizing the services of a Binary Options trading site and as such look out for those sites that have many different deposit and withdrawal options, the more options a site has then the more chances you will have of find a method that is cost effective.
No Limits: Many Binary Option Trading sites will not put into place maximum limits on not only how much you can made as profit per trade but also limits on how much you can actually cash out at any one time!

This is something that no legitimate Binary Options Brokers will make their customer endure, and as such when seeking a good and reliable trading site look out for those who have no or very high limits in regards to how much profit you can make per trade and also those which will let you withdraw all of your profits without any limits what so ever!

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Guide to Options Trading

There is now a brand new way that you can make some significant amounts of money through stocks and shares, currencies and also commodities such as Gold and Silver, and this is by trading Binary Options online.

However, there is one major advantage of trading Binary Options and that is you never have to actually purchase the shares, commodities or currencies that you will be hoping increase or decrease in value during any given time period!

If trading Binary Options online has sparked an interest in you then it can be, at first, a rather confusing way of making money, however once you have mastered the way Binary Options work, which will only take an hour or so, you will be able to master trading them and with a bit of skill you could make continuous profits.

With this in mind we have put together the most comprehensive Binary Options trading guides found anywhere online, and via a step by step range of guides we will explain how you can be online and trading Binary Options in no time.

First step of trading is to choose a broker. Have a look at the recommended brokers from here.

We invite you to have a look through each of the following guides, for when you do you will probably wish to start trading yourself!

Types of Binary Options

There are hundreds of different Binary Options that can be traded online or via mobile trading platform, and as such you really should checkout our guide on the different types of Binary Options that are available, for we can guarantee there will be several of them that will interest you.All of our listed and reviewed Binary Options sites offer a truly massive and constant range of Binary Options and as such you are going to be in full control which ones that you opt to trade and will not be limited to just a handful of different options to trade!

Types of Binary Option Platforms

You are going to be able to trade Binary Options either online via any laptop or computer, or should you prefer the maximum flexibility of when you can place a trade then you ought to consider using one of the many mobile compatible trading platforms that are now available. You really can trade anywhere and at any time of your own choosing and this is why trading Binary Options has proven to be so very popular recently!

How to place Binary Option Trades

In this guide we are going to show you just how easy it is to place Binary Option trades online, it is a very easy to understand trading environment once you understand how trading platforms work and operate, so do come and take a look at what is involved and just how easy it is to trade at any time of the day or night.

Binary Options Demo Accounts

This guide will enlighten you on how you can open a free of charge and free to use demo account at all of our top rated Binary Options trading sites and by doing so you can quickly and in a no risk way get used to the many unique features each Binary Options trading site has to offer.

Binary Options Trading Signals

There are many little pointers and signals that you need to look out for in respect to when the value of any commodity, share or currency is going to move one way or the other in value and as such please do checkout our guide which will give you plenty of food for thought in regards to which Binary Options you should be looking to trade and when is the best time to trade them!

How to Make Money with Binary Options

Everyone wants to make money trading Binary Options online and as such why not take a look at our guide which is going to reveal how you can get off to a winning start when you first start to trade Binary Options online!

Binary Options Trading Tips & Strategies

We have several trading hints and tips which we feel will be a lot of interest to many Binary Options traders, if you are new to this exciting and potentially very profitable environment then does checkout our collection of tips and strategies to hopefully allow you to increase the number of winning trades you place online!

Are Binary Options Legal?

As trading Binary Options is a financial based environment there are many licensing procedures each trading site has to adhere too. We only present to you the very best rated Binary Options brokers and sites and as such if you want to find out more about how safe and secure and how this industry is regulated feel free to checkout our guide on licensed Binary options sites.

Binary Options Site Reviews

Once you have read through all of the above Binary Options guides you will finally be ready to find an online trading site at which to open an account at. There are in fact many sites that we have handpicked for our website visitors based on our long experience of trading Binary Options online, so we are more than confident each and every Binary Options trading site we have reviewed will live up to your very highest standards.

If you do decide to join up to any of our reviewed sites then you are going to be able to take advantage of some generous sign up bonuses, that will ensure your trading budget gets a boost in value and this will give you even more opportunities of making plenty of winning trades!

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Trading Tips and Strategies

We will now introduce you to some savvy ways that you are going to be able to trade Binary Options online, these various hints and tips cannot be guaranteed to make sustained profits, however when you take notice of them you may find yourself placing more winning trades than you usually do!

Take Advantage of Bonuses

As you are going to be showered with all manner of welcome and sign up bonuses at all online Binary Option sites you may as well make full use of them, however it can pay dividends for you to utilize all bonuses optimally and here are a few ways you can do this.

Hedge Binary Trades Using Bonus Cash – When you join up to two different Bandy Options trading sites you will of course be able to hedge your trades by utilizing each sites welcome bonus cash and then placing opposing trades at each site. So whilst one of those trades will be a losing one, the other one will naturally be a winning one and as such a guarantee profit will be made with that bonus cash!
Look out for Re-Deposit Bonuses – More and more Binary Option trading sites are now offering their regular and most loyal customers with something known as Re-deposit bonuses, these are offered to you from time to time and whenever you make a qualifying deposit then you will be credited with a bonus into your trading account, and it does go without saying the more cash you have in your account the more chance you will have of making a winning trade!

Questions about Binary Options Bonuses

Below are a few commonly asked questions relating to Binary Options bonuses, have a quick look through them in case you are asking these questions yourself as the answers to these questions will be found below!

How Big Are Binary Options Bonuses? – The amount of cash you will be awarded with as a Binary Options bonus will depend on just which site you are a member of or are thinking of becoming a member of, it is not unusual to be offered a bonus worth up to 100% of your deposited amount, but sometimes from time to time bigger bonuses can be available.
Can I Open More than One Account per Site? – If you are wondering if it is possible to open more than one trading account at one particular Binary Options trading site to be able to take advantage of their sign up and welcome bonuses more than once, then this is not possible if you try and do this you will have any bonuses granted voided!
Do Mobile Binary Option Sites Offer Bonuses? – You will find just the same number of bonuses and the same value of bonuses available at both online and mobile Binary Options trading sites, so you will not be making any compromises should you choose to sign up to a Binary Option site via a mobile device!

News and Information Channels You are always going to have to keep your finger on the pulse of all current news stories for the very second a news story breaks that may affect the value of commodities such as Gold or Silver or any news story that is going to have an effect on the share price of a company or the currency value of any country you need to be able to react instantly and place your Binary Options accordingly.

Many Binary Options trading sites will have their own daily news stories on offer on specially set aside areas of their website, however it will be more advisable for you to tune into rolling news channels and keep our eyes and ears peeled for any breaking news stories for by getting access to those news stories first you are going to be able to react quicker and place the most well thought out Binary Options trades!
Should I Follow the Money?

Sadly a lot of people can act like sheep when they are trading Binary Options online and they will simply see what other traders are doing and will follow the money and place trades which other people are placing.

Whilst this could possibly see you making the occasional profit, no one ever got rich by following another persons lead and as such you should always be prepared to take a few risks when trading Binary Options and use your own skill and judgement in regards to choosing trades to place online.

Always try and have a mobile device at your side and ready to use for when you need to get a Binary Options trade place and you are out and about the fastest way to do that is to simply access the mobile trading platforms that all of our listed and top rated Binary Options trading sites have available.

Should I Utilize Early Exit Trades? – We often get asked by new online Binary Options traders should they take an early exit from a Binary Options trade they have placed to ensure they can make a profit from that trade. Taking an early exit can be something of a double edged sword for you will be paying an additional fee or commission out of your winnings to allow you to pull out of that trade there and then.

So if you are convinced that the value of your chosen Binary Option trade is not going to stay at its current level and will move in a negative way, then that is the only time you should consider an early exit for by continually taking this expensive option your overall winning profits will be diminished in value and that is something no trading will be wanting!

Should I Use a Pay Per Tip Site? – If you ever come across any sites offering you tips in regards to Binary Options then never be tempted to sign up to them more so if they charge a fee! If the site owners had the skill needed to pick winning trades they would be trading Binary Options and not simply selling tips!

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What Are Binary Options?

It is important to understand what are Binary Options and the basic concepts of trading first before you go any further.

Binary Options are an innovative and relatively new way of trading options. The name derives from there being two possible outcomes (up or down, “in the money” or “out of the money”), hence the name binary. The idea is to predict which way the asset will go after a predefined period of time. For example, you may predict that the USD/EUR will rise to 1.35 in the next hour. If it reaches that point returns of perhaps 85% are possible. If it doesn’t you lose your investment but many brokers will return a small proportion to you of up to 15%.

Binary Option trading is based on research and a certain amount of knowledge of the traded assets. While you don’t need to be an expert, any knowledge you have certainly helps manage your risk. The online platforms available today make trading easy from anywhere in the world once you have an internet connection. All the information and research you need is also available online. You make predictions on the expiry price of your chosen asset and decide how much to invest.

Smart traders use strategies to help them maximise their successful trades. A simple and effective strategy for new traders is the Trend Strategy.

Binary Options can be traded on stocks, stock market indices, forex pairings or commodities. Binary Option trading is straightforward and can be lucrative with quick returns available but nothing is certain and losses can be made also.

To get started I would recommend learning everything you can about this form of trading. Educate yourself and give yourself the best chance of success possible. Sign up with a recommended broker and take advantage of demo systems to practice your strategy before trading with real money. Good brokers also have support staff on hand to give you any help and assistance needed.

There is some terminology used in Binary Options Trading that you will find useful to know. If a trader believes the market is going higher, he would place a “CALL”. If the trader believes the market is going lower, he would place a “PUT”. In order for a CALL to make money, the price must be above the strike price at the time of expiry. In order for a PUT to make money, the price must be below the strike price at the time of expiry. The strike price, expiry and payout are all defined at the outset of the trade. (See Glossary for a comprehensive list of the terms used in Binary Options trading).

One of the advantages of Binary Option trading is that the risk and reward are known from the outset. It doesn’t really matter how much the market moves for or against you, you will win a fixed amount or lose a fixed amount. As you never own the assets you are “trading” on you have no liquidity issues. A disadvantage is that you must be right more than 55% of the time to make money with many brokers.

In summary, Binary Options are a new and innovative way for speculating on stocks, currencies, indices and commodities but come with advantages and disadvantages. However, you can increase your chances of success by smart research and implementing a good solid strategy similar to the ones discussed in in the Strategy Pages.

Binary Options are a fun and quick way to make some extra cash for a casual trader or a substantial income for a full time dedicated trader,

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How To Choose A Binary Options Broker

When getting started with Binary Options one of the most difficult decisions you will need to make is how to choose a Binary Options Broker. Due to the fact that binary options trading has only been around for a couple of years, most binary options brokers haven’t yet had the opportunity to establish themselves as reliable and trustworthy. Some have recently been regulated or in the process if being regulated which will give prospective traders a level of comfort when depositing funds and trading.

In this new, innovative and exciting market, brokers are competing hard for traders business. To the average investor, this is a very good thing, as it translates to better contract terms and higher quality service. But there are some factors that differentiate binary options brokers from one another.

When researching a Binary Options Platform keep the following points in mind.

  • Always choose the platform that gives you the biggest payout, this is just common sense. When you are shopping online for any other product you go with the cheapest assuming all other things are equal, right? You get the best value for your money. “Shopping” for a Binary Options platform should be no different, choose the platform that maximises your returns.
  • Pick a trading platform that pays out 70%+. You do know in advance what the payout is going to be or indeed what the loss is going to be before the expiration of the option, this is one of the greatest advantages of trading in Binary Options.
  • Choose a platform that pays even when you lose “out of the money”. Some platforms pay back as much as 15% when you are “out of the money” which is better than nothing and looking for “out of the money” returns will help you narrow down the choices.
  • Chose a platform that offers a wide range of assets. This increases the chances of that asset being discussed or reported on. Your chances of finding good research on the assets increase as the variety of assets offered increases. The research you find will help you make the “put” or “call” decision.
  • Watch for “extra” charges such as fees to deposit or withdraw funds. There are some with low or zero charges.
  • The platform should have a good customer service support facility. You never know when you will need help or support. Many have live chat and local helpdesk numbers.

Look for a platform that has good security with 128 bit SSL encryption.

Something many traders over look is the broker’s terms & conditions. It is very important to review closely any contract or terms & conditions when choosing a binary options broker. Look for their rate of pay out, as I said above this should be 70% or more, if a broker is paying less you should consider alternatives.

Likewise any rebate on “out of the money if offered will be in the terms of contract as will the list of assets offered, the range of expiry times offered and any minimum or maximum investment amounts allowed. The terms and conditions will give you a good picture as to whether or not that particular broker/platform suits your needs.

Many brokers offer very attractive bonuses but you should check the terms attached to these bonuses very carefully before accepting. In many cases you must trade a multiple of the bonus offered before you can make a withdrawal, often more than 20 times the value. While it is great to get a sizable bonus, be aware of any conditions attached.

As the Binary Options trading market is relatively new, many of the brokers are new too. It is your responsibility to check them out with research using online resources, forums, recommendations, referrals etc. There are many sources online today which have reviews of platforms and brokers and are worth a visit. If anything at all crops up you should move on as there are plenty to choose from.

In summary, there are many variables and points to consider when you choose a Binary Options broker but overall you are looking for value. You need to try and maximise your returns, get something back if you lose, you need the widest choice of assets to trade and have minimal extra costs to trade and above all you need a secure environment in which to trade. Don’t forget to review any terms & conditions offered and to carry out some research on the brokers’ reputation

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How To Get Started Trading Binary Options

To get started trading binary options firstly you need to sign up with a trading platform and make an initial deposit. Read “How to choose a Binary Trading Platform” to familiarise yourself with what to look for in a good platform.

Once you are signed up play around with the demo system if the platform has one available. This will give you an insight to how the system works.

You now need to decide on which assets to trade on. The current choices are:

  • Stocks (Apple, IBM, GE, Facebook etc)
  • Commodities (Gold, Silver, Oil etc)
  • Indices (FTSE100, DAX, NASDAQ etc)
  • Currency Pairs (GBP/USD, EUR/USD, GBP/EUR etc)

When you have chosen your asset you need to decide whether to choose a Call or a put on that asset.

A CALL option is when you think that at the time of the contract expires, the asset will end higher than at the time when you opened the trade
A PUT option is when you think that at the time the contract expires, the asset will end lower than the time when you opened the trade

To start, trade with small amounts and in an asset you are familiar with if possible. Carry out some research on the asset to see if there are any news updates or historical factors that may influence the movement of the asset price one way or the other.

The golden rule is never trade more than you can afford to lose.
TYPES OF OPTIONS

The most common type of option is the UP/DOWN option like the one discussed above. You simply need to the option to finish higher if you placed a CALL or lower if you placed a PUT.

The best time to use this type of option is in a trending market.

Another common type is ONE TOUCH or NO TOUCH option. With ONE TOUCH you predict that the price will reach a particular level but may not sustain that level. All you need is for the price to touch that level before the option expires, it doesn’t matter what happens after the level is reached, the price may fall again and you still win. The opposite is the case for a NO TOUCH option, you get paid if the price does not reach a predefined level before the option expires.

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Types of Binary Options

There are a number of different types of Binary Options available for trading. This can seem a little confusing to a new trader and indeed some experienced traders.

Traders can choose the method most suited to their trading needs. Experienced traders choose different methods depending on the current market conditions and how they expect the markets to react to external influences, announcements, results, trends or other conditions.

Digital Option

The most common is the Digital Option or often referred to as the UP/DOWN Option and the CALL/PUT Option.

The trader places a CALL if he/she believes the price will end up above the entry price after the expiration of the contract and a PUT if he/she believes the price will finish below the entry price.

You must simply determine whether the digital option will end at a higher or lower rate than the active trade rate when you entered the trade.

Various expiry periods are available including 60 second, 15 minutes, 1 hour, end of day etc. Once you have committed to the trade, the platform automatically monitors your trade and exits at the appointed time without you even needing to be logged into the system. You will usually be sent an email notification with the closing status of each trade.

You can easily follow the status of on-going trades on the Trading Platform or from your account portfolio page.

Touch Option

The Touch Binary Option is another method of trading Binary Options. It has a number of varieties including TOUCH, NO TOUCH and DOUBLE TOUCH.

It comes with predefined rates needed to win the trade, rather than the trader simply predicting whether the value of the underlying asset will increase or decrease, he/she predicts a level it will reach (touch) or not reach (no Touch). This can be a level that is either higher or lower than the current price of the asset.

Options can only be purchased at the weekend when the trading markets are closed. Then it trades during the week. If the asset touches or has passed the specific level at 17.00 GMT on Monday, the system declares a win, and the trader receives a predefined payout of up to 500% in some cases. If you are out of the money, the trade will continue in the same manner until Friday when the platform expires, continuously checking each day to see if the price has reached the rate needed for a win. This gives the trader 5 days and 5 chances to hit the target.

NO TOUCH – pays when the level defined is not reached and with DOUBLE TOUCH two levels are defined paying out when either level is reached.

One Touch is ideal for traders who believe that the price of an underlying asset will reach the predefined level in the future, but who are unsure about the sustainability of this price.

60 Second Option

This method expires in 60 seconds and is becoming more and more popular. The advantage of 60 second trading is that if the value of an asset is clearly moving in one direction, the trader can take full advantage by conducting a number of successive trades to maximize their profits. This makes the platform ideal for traders who are excited by the prospect of quick rewards, and who are able to respond quickly and effectively to sudden market movements.

60-seconds

Essentially this method is the same as the Digital Option with very short expiry times and used by traders to profit quickly from a trending market.

Boundary Options

This method is sometimes referred to as a Range Option or Tunnel Option and is similar to the Touch option but in this method two levels are defined. Upper and lower levels are defined (the boundary or range) and the trader needs the asset to stay inside this boundary to receive a payout. Some brokers will allow trades on payout on the asset breaking out of this boundary.

The variants of this method are where the asset must stay between the limits (or break out of the limits) and where the asset ends between the limits (or ends outside the limits).

This method is ideal in a stable market when trading inside the boundaries and in a volatile market when trading outside the boundaries.

Other Methods

Some brokers have different methods available or allow the trader to create their own methods. For example, Banc de Binary has a method called BinaryMETA which allows the trader to sell early or double their money mid-trade.

The BinaryMETA method gives the trader analytical tools, allowing him/her to follow an asset’s history from the moment it started trading. To review the history, the trader simply clicks the backwards or forwards buttons for ‘1 hour’ or ‘10 minutes’. In addition, they can see their placed options directly on the graph. This allows them to analyze their options and make real-time decisions the way professionals do.

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