13 August 2012 12:23

What Are Binary Trading Strategies And How To Manage Their Risks?

Binary _options _trading1

As a concept, Binary Options trading is fairly straight forward and simple. It is nothing but predicting whether an asset would rise or fall by the end of a time period. However, it is much easier to earn and maximize your profits if you are aware of the strategies that binary options brokersand experts use. The following are some binary trading strategies you must know about -

Straddle - Straddle, as a general strategy, means that you forecast different levels of price for an asset. The prediction could be that the price would rise above a certain point or that it will fall below a certain point. Because you have set a range, if the actual price is within the range anticipated by you, you would end up on the winning side. In binary options, you buy a call and a put with the same expiration date and strike price to create a straddle.

 Reversal - If your estimates show that the market might change direction, then you follow this strategy. It involves going in the opposite direction of what you have been following thus far.

 Knock On Effect - Some assets affect other assets when their price changes. They are complimentary assets whose prices follow a certain function in relation to each other. So, forecasting becomes difficult in this case because you have to ensure that your estimates take all these future effects into account.


The main purpose of all the binary option trading strategies is to manage your risk. The idea is not simply to reduce risk to a bare minimum but to create the right balance between risk and returns. You might be aware that risk and returns have a direct relationship. This means that your returns increase with your risk and hence, managing risk is important.
Never follow trends and rumors blindly but this doesn't mean that you should not know what is going on in the industry. Even if some rumors are untrue, they tend to have an effect on prices and you must be there to cash on the benefits.
You should always research well before you zero-in on an asset. Guesswork never works in trading, always back your guts with facts and figures and never gamble. This doesn't mean that you would never lose money. It simply means that the chances of losing money would be reduced. Binary Options trading requires utmost patience and determination and you would require these qualities to become successful.

Post comment

Related debate

  • 1 week
  • 1 month
  • 1 Year
23 Apr
BIOPOR
Til dem der måtte være interesseret så har jeg skrevet lidt om Bioporto GF og min efterfølgende snak..
31
18 Apr
VWS
Der har ikke været skrevet meget om hvad det nye MHI Vestas JV vil i Kina. Det har været nævnt kort ..
15
20 Apr
GEN
Jeg er normalt ikke så let irritabel, men nu må det snart være nok. Igennem den sidste måned har j..
14
22 Apr
GEN
Lad nu være med at træde hinanden over tæerne gang på gang i jagten på, hvem som har mest ret. Det e..
12
23 Apr
TOPO
Asymetrisk information i markedet?!     Antagelsen er, at der er foretaget en relativt dybdegående d..
9
21 Apr
TOPO
Jeg er meget enig. Hvis man ser på det tilsendte materiale, så får vi som Topo-aktionærer +50% ift. ..
9
21 Apr
EI
Jeg syntes, at mange af bemærkningerne ovenfor viser, at janteloven stadig er gældende. "Han skal ik..
9
21 Apr
E:BARC
Normal 0 21 false false false NO-BOK X-NONE X-NONE ..
9
18 Apr
VWS
Den overvejelse vil jeg i bedste fald kalde irrelevant. For det første er længder af kyststrækninger..
9
22 Apr
GEN
Hvis GW kun skulle udtale sig om de aktier, han virkelig ejer ville der blive meget tomt på disse si..
8

Tech Companies Send Criticism Along With NSA-Related Data -- Update

04/02/2014 00:06:00
By Danny Yadron Technology companies including Google Inc. and Microsoft Corp. released new figures on the amount of data requests they received from U.S. ..

U.S. Hot Stocks: Hot Stocks to Watch

03/02/2014 14:07:00
Among the companies with shares expected to actively trade in Monday's session is Herbalife Ltd. (HLF). Herbalife Ltd. (HLF) raised its fourth-quarter outl..

Pfizer Study Meets Primary Endpoints

03/02/2014 13:05:00
Pfizer Inc. (PFE) said Monday that a Phase 2 trial of its advanced breast cancer treatment met its primary endpoint. Pfizer said a study comparing the effec..

Most read news

  • 24 hours
  • 48 hours
  • 1 week
1
NUMERICABLE GROUP : 2013 FINANCIAL REPORT NOW AVAILABLE ON GROUP WEBSITE
2
Metso's Interim Review January 1 - March 31, 2014
3
Bavarian Nordic Welcomes Gerard van Odijk as New Chairman of the Board
4
Novartis delivered solid sales and profit growth in the first quarter of 2014; strong innovation reinforces growth prospects as company transforms portfolio
5
Hypo Alpe-Adria (Jersey) II Limited - announcement of publication of 2013 annual report and financial statements
Euroinvestor around the globe: Euroinvestor.dk | Euroinvestor.se | Euroinvestor.no | Euroinvestor.fr | Forexinvestor.com| Wisselkoersen.nl | Valuta.se | Valutaveksel.no | Divisas.es | Valute.it
Copyright Euroinvestor A/S 2014   Disclaimer and Terms of Use
Quote information is delivered by Interactive Data.
Data is delayed 15-20 minutes according to the distribution agreements set by the different exchanges.
 
25 April 2014 00:51:31
(UTC) Dublin, Edinburgh, Lisbon, London
Version: LiveBranchBuild_20140324.1 - EUROWEB5 - 2014-04-25 01:51:31 - 2014-04-25 00:51:31 - 1000 - Website: OKAY