WikiTrader Software Binary options are often known as digital, fixed return or all or nothing options. To trade binary options a trader will have to determine whether the market price of the options will increase or decrease over a specified amount of time. The options that traders will predict prices on include currencies, commodities, indexes and company stocks. Many traders turn to binary options because they are easier to trade, the platforms for trading are all user-friendly, the returns are fixed and you can achieve profits in an hour or a day depending on the option you trade.
Before you start trading binary options finde if because it is important that certain terms are understood. These terms will be used by brokers and it is important that you understand what they are. If you do not take the time to learn the correct terminology you could find yourself trading in the opposite direction to what you want.
• Put option also known as the down or sell option is when the trader profits is an option drops below a certain price.
• A call option also known as the up and buy option is when a trader profits from an option increasing in value above a set point before expiration.
• At-the-money is when the option you have purchased is at the same price as the one used when the trade was opened.
• Out-of-the-money is when the trade is not profitable for example when a trader believed an option would increase in value, but it has since decreased in value.
There are many reasons why you should consider trading binary options. Some of the most common reasons for starting in this market include:
• Easily knowing the risks and returns of the investment
• Not needing a large amount of initial capital to start trading
• There are no spreads on the trades which mean that you get the same price if you place a call or put option
• The positions will expire automatically after a set amount time
• Profit is made whether the market is going up or down
There are a number of different strategies that traders can use to ensure they profit in the binary options market. Some of these strategies are complicated with the wikitrader scam having to complete calculations to ensure that they make a profit from their trade. A simple strategy would be to learn how to determine the overall trend of an option.
One method of looking for a trend is to look at the peaks and troughs in the charts. If you see at least three successive peaks the trend is up and three or more successive troughs mean a down trend. Of course, it is important to note that the markets are affected by economic indicators, news events and major announcements.
While it is possible to easily get into WikiTrader Software binary options trading you need to be careful as there is a thin line between trading and gambling. To ensure that you are not gambling on the markets you need to have clear goals you are looking to achieve. You also need to have a trading strategy and some means of analyzing the binary options market to determine how you should be trading.