What should the beginners know about Binary Options Trading?
Many people constantly fail in binary options trading. They look for Binary Options Robots, Auto Trading Software to get rich quickly and further lose money. If there were real profit-making trading robots and software, why would the software owner like to sell it? Nobody in this world wants to make some stranger rich for Free or by charging a few bucks. Alternatively, they would create many accounts with different brokers and make millions from these accounts.
Some binary options robots and software generate reliable trading signals while providing a verifiable track record. These may be used with due caution and care while keeping in mind the proper money management.
Now, let us analyze what can bring you success in binary options trading.
1. Trade a small amount (1 or 2 %) in each trade, make 5 to 10 trades daily to make 5 to 10 % profit daily. Although trading binary options trading is available 24 x 7, it's not wise to trade 24 x 7. Trade only when there is good volatility in the market, and technical analysis give good predictions. The best time to trade is usually when London and New York markets remain open simultaneously (1200- 1600 hrs. GMT), similarly when Sydney and Tokyo remain open (2300- 0600 GMT).
2. Constantly follow your money management strategy. Please write down your strategy and investment rules and follow them strictly.
Example:
I follow ADX, Stochastic, RSI, and Bollinger bands to find my trading points and always trade in the trend's direction. ( Trend is our friend).
After a loss-making trade, I wait for the next opportunity and invest a double amount in recovering. This gives my account steady growth. But I stop trading after four consecutive losses and start afresh. For a $1000 account, I start with $5, and after a losing trade, I go for $10 trade and subsequently $25 and finally $50. If I don't recover here, I stop for sure.
By following this money management, I have grown my account significantly in 6 months.
3. Don't make revenge trading after a loss and subsequently blow out your account.
After losing 4th time, as described in the above example, it is never advisable to keep increasing the trade size to recover. By doing so, you are going to blow out your account. (Never do revenge trading)
4. If you follow the above steps strictly, it really difficult to blow out any account in Binary options trading. Most traders usually become greedy and trade with big amounts to get rich quickly, blow out their accounts and make themselves poorer instead.
5. Hence it's actually poor money management to be blamed for every unsuccessful trader. Because if you follow good technical analysis, it's very rare to lose four consecutive trades even if you follow some common indicators and strategies.
Binary options trading has become so lucrative because of its profitability that people simply jump into it without thinking of the risks involved. Yes, it gives a return of up to 95% for a single trade, but its comes with high risks involved. If you are not successful in a trade, you lose all the amount invested in that trade. You must understand binary options thoroughly and practice it in a demo trading account. When you master it and know every aspect of it, you can start trading. Never How to trade Binary Options? invest more than you afford to lose in such kinds of high-risk trading instruments.
Practice Binary Options trading in a risk Free Demo account before trading with any real money. Trade responsibily.
Your Capital is at RISK while trading Binary Options.