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The binary options
The popularity of financial markets in recent years has increased substantially, and binary options and is breaking all records for growth of interest in the marketplace. High interest prompts to tell more about how binary options. I think that this article should start with the most dynamically developing financial market.
Begin with the story, but hard to "smear" will not, because the most important thing need to mention is the formal adoption of binary options by Chicago Board options exchange (ITS) in 2008. You can say that after this event binary options started their way to glory, gradually becoming the most convenient speculative instruments in the financial markets.
What is a binary option? Is an electronic contract on certain asset, having known in advance the exact time of completion. As assets most often are:
• shares of different companies
• currency pair
The main features of binary options:
• known in advance the time of completion of the transaction with an option (end time);
• the yield on each binary option is fixed and does not depend on the difference between the purchase price of the contract and the sales price;
• risks always strictly limited to the option price that we paid for it;
• to trade binary options you do not need to install any additional software (all actions are performed in client Cabinet on the website of the broker).
Read more about the main issues:
• the essence of binary options
• how to register for an account
• is it possible to make money on options
The principle of binary options trading
As mentioned earlier, binary options can be purchased on a large number of assets, for example, in Gazprom shares, the currency pair USD/RUB, oil and so on (generally brokers provide 100-200 options of assets). All transactions are in real time directly in the trading platform, which is located in a private office.
How to construct binary option that it is possible to earn? Our task is to determine whether the price of the chosen asset is above or below the current market price value.
Give an example. For example, we opened a price chart of crude oil in my trading platform:
We see that during the day the price of black gold is declining, and the media reported about the increase of production volumes in different regions. Usually this kind of news is not played by the market in a matter of hours, so the probability of further rate fall of black gold.
Now we need to capitalize on the apparent decline in the market price. We execute following actions (on the example of one of the market leaders, company 24option):
• open schedule of asset (if previously not done);
• ask yourself the value of the option (profit is calculated as a percentage, so the more expensive the option, the higher the income of money);
• select the time option from the proposed options (for example, after 1 minute, maybe 3 hours - the trader decides);
• assume that the price will fall, then click "price below", thereby determining the direction of the transaction;
• "buy" button to purchase a binary option exposed us parameters.
If the prediction was correct, we immediately after the end of the option get back the amount spent on the purchase contract (in the illustration above is $30), as well as the profit, which we known in advance (73% = $21,9). By the way, the selected asset (the oil) not the most profitable on the binary options, for example, per trade on the EUR/USD (Euro/dollar) you can get 83% of the value of the option.
I think now more clear how to construct binary options, and work with them. Nothing complicated from a technical point of view here, can understand almost any person for one hour. Another thing is how difficult it is to correctly predict the behavior of market prices. To analyze the situation experienced traders use special (free) trading system here is a description of a few such techniques:
• Strategy on news
• Simple trading strategy
The principle of operation trader with binary options trading revolves around the need for correct definitions, will go up or down the market rate of the asset to the selected point in time. Even if the price will move one penny to the side, which we have identified, it will be enough to get a profit in full, for example, 83% of the asset EUR/USD.
Ways to withdraw profit the abundance, ranging from electronic payment systems, QIWI, Webmoney, etc., ending with the Bank transfers. Depending on the choice of the broker company, the trader transfer money from 1 up to 7 days.
|Category: Binary options | Added by: (07.11.2017)