Given the largely technical-sounding nature of binary options trading, many inexperienced investors often shy away from the opportunity of making substantial profits via options trading. However, the truth is that binary options trading are one of the least complex and easily understandable investment options on the market. If you can understand trading stocks or putting money into mutual funds, there is no doubt you only need a few minutes to get the hang of options trading.
Here is a short guide to get you started into one of the most profitable ventures nowadays.
- It all starts with finding a great broker. A broker is the online website that you go to in order to trade binary options. It is basically the equivalent of the New York Stock Exchange except that there are many brokers so selecting the right one is crucially important. Read on reviews so you can check which brokers are worth your time and which ones are well worth forgetting.
- Open an account. All brokers should have a simple guide on how to do this plastered on the main homepage. Follow the simple steps to sign up so you can begin your options trading journey.
- Open signing up, take the time to be familiar with the features if you are new to options trading. Read the resources that are provided so you get the hang of it. If you want a faster way, you can always watch a demo video or better yet, use the demo account feature to make a few practice trades.
- Now you are ready for your first trade. First up, choose an asset to trade. Choose whether you want to call or put. Call means you expect the asset price to end up higher than the current price when the option expires; a put is obviously the reverse of a call. Choose the expiration of the option; 60 minutes is fairly common although there are selections for end of day, end of week or even longer. Enter the amount you want to trade and click SUBMIT or EXECUTE.
- Wait for the expiry! If you are able to anticipate the price movement correctly, you should see your account balance go up when the payout is credited shortly after expiry.
The secret to successful options trading is practicing and paying attention to the latest news on how assets are performing so you have a basis for making sound decisions when placing trades.