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
26 Oct
VWS
Fra tid til anden lytter jeg til Solveig Bjørnestad’s P1 Business. Hun er dygtig til at lave en 360 ..
36
27 Oct
VWS
Normal 0 21 false false false DA X-NONE X-NONE ..
26
28 Oct
I:SP500
Det ser grundlæggende ganske fint ud makroøkonomisk, hvilket ikke er det samme som at der ikke finde..
16
26 Oct
BAVA
Jeg synes du skulle lade være med at bekymre dig om kortsigtede udsving, og ganske enkelt gå lang i ..
16
29 Oct
VWS
Hej Pokerchamp, det du kalder 'amatør-detektiv'-arbejde er langt mere informativt end dine ukonstruk..
14
28 Oct
VWS
 Fredag d. 3. okt. i år var den norske Olie- og energiminister Tord Lien og næstformand for det nors..
14
30 Oct
VWS
Jeg sad ellers lige og kiggede endnu en ordre i Polen   34 MW Postolin Wind Farm   Den ordre må være..
13
29 Oct
FING-B
Swift - det er jo fuldkommen ligegyldigt hvad vi siger eller gør så synes du og dit slæng det er for..
12
31 Oct
 
Hej alle,   Hermed en lille service mail til alle jer udbytte investorer (ligesom mig selv). Herunde..
11
30 Oct
DANSKE
Og pludselig savner jeg alligevel den der "røde tommel ned"  der endgang var her på EI 
11

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
HEINEKEN majority owned subsidiaries Nigerian Breweries plc and Consolidated Breweries plc issue notice of Extraordinary General Meeting regarding Scheme of Merger
2
USG People acquires stake in Blue Carpet
3
Novartis BNP Paribas Primary New Issues : Stabilisation Notice
4
KATE SPADE & COMPANY TO RELEASE THIRD QUARTER 2014 RESULTS ON THURSDAY, NOVEMBER 6, 2014
5
Christian Dior : Notice of availability of the financial annual report as of June 30, 2014
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.
 
01 November 2014 01:40:28
(UTC) Dublin, Edinburgh, Lisbon, London
Version: LiveBranchBuild_20141028.2 - EUROWEB4 - 2014-11-01 02:40:28 - 2014-11-01 01:40:28 - 1000 - Website: OKAY