Binary options: is it possible for beginners and advanced to make money?

Binary Options
It's no secret that today binary options occupy not the last place in the ranking of all kinds of ways to make money on the Internet. Some consider them an excellent option for quickly increasing their investment deposit, while others, on the contrary, consider them the best way to get rid of it.

Despite such a controversial reputation of binary options, today quite a lot of brokers offer them to their clients, since their level of popularity is quite comparable to many derivatives exchange instruments.

Why opinions about binary options differ so much and how realistic it is to make money on them, we will try to figure out during the course of this article.

• Binary options - a scam or not Binary options - a deliberately losing instrument?
• Trading options is like walking on thin ice
• Will it be possible to withdraw what I earned from binary options?

Binary options - scam or not

Is it possible to make money on binary options
? People who are not very familiar with this topic most often consider binary options to be one of the types of trading in exchange-traded assets. However, there are fundamental differences between these two concepts.

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When trading on an exchange, you purchase securities, deliverable futures, cryptocurrency and other assets that you can own. With binary options, you are not buying anything - you are simply betting that the price will rise or fall.

And since we are talking about bets, it is not difficult to come to the conclusion that the trading platforms of binary options brokers are designed like casinos - sometimes they allow you to win, but in general they are set up so that the majority of clients end up losing.

Watch the video to see what an active trader thinks about this:

Binary options - scam or not

Are binary options a losing instrument?

Chances of making money on binary options
Unlike margin trading, where a user can get 100%, 200%, 500% or more percent of profit from one transaction, there are no such figures in binary options.

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The standard bonus for a successful bet most often does not exceed 80% (in some cases 90%). At the same time, an unsuccessful transaction with binary options brings a 100% loss - the entire amount invested in the bet is withdrawn in favor of the broker.

As you can see, the rules are not entirely fair, since one profitable trade (with the same bet size) is not enough to compensate for one losing trade. And it’s not at all difficult to calculate that in the long term, binary options trading is a game with a deliberately negative mathematical expectation.

For example, you make 100 trades worth $10 each. If the forecast is made arbitrarily without a well-thought-out trading strategy, as happens with most beginners, then according to the theory of probability, the ratio of profitable and unprofitable bets will be approximately 50/50 (as when tossing a coin). In this case, losing trades will cost you 50*10$ = 500$. But for winning bets, the result will be slightly different - 50 * $8 = $400 (multiply by $8, assuming that the option premium is 80%). In total, after 100 trades, despite an equal number of wins and losses, you will still be at a loss of $100.

A wonderful scheme, isn't it? It’s just wonderful for a binary options broker, but not for his clients.

Trading options is like walking on thin ice

Risks when trading binary options
In addition to the fact that the trading premium is always lower than the potential loss, there is another unpleasant aspect associated with this parameter in binary options.

The fact is that the percentage of return may vary depending on the selected asset, the volatility of its exchange rate and other factors. Moreover, for many brokers this can happen at any time, even after opening a transaction.

This means that the rate at which at the beginning there was, for example, 80% profitability, by the time of expiration it may well be “blown away” to 20%. It turns out that the trader seems to have made a profit, but the size is not particularly encouraging. Especially when the bet was made with the expectation of covering a loss of a specific size from past transactions.

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Unfortunately, there is no way to find out the reason for the change in profitability - maybe it really happened due to natural market processes, or maybe it was done by the broker on purpose to prevent the client from earning a serious amount.

Binary options rate manipulation

Also, on some binary options platforms, manipulation of asset prices may occur. After all, no matter how much they insist that prices are read in real time from third-party exchanges, such platforms are always an internal “kitchen” where you can do whatever you want.

For example, when a client of a binary options broker begins to make noticeable progress in trading, the so-called “slippage” mode may be activated for him. At the same time, right before expiration, the rate makes a sharp jump in the unfavorable direction, which is why the transaction is closed at a loss. The deviation occurs very briefly, and the price immediately returns to its normal state, but this no longer plays any role.

For such situations, brokers always have a prepared answer in the style of “there was an uncontrollable surge in liquidity at the supplier’s site.” That is, the blame is shifted to a third party (often non-existent) and the trader is made to understand that he will have to come to terms with what happened.

Of course, not all binary options brokers use the methods described, but those who do not play fair are enough to ruin the reputation of this entire industry.

Will it be possible to withdraw what I earned from binary options?

How to withdraw earnings from binary options
Even if the user is able to adapt to the operating features of his binary options broker’s terminal and starts trading profitably, another unpleasant situation may happen to him.

We are talking about withdrawing money from your account balance - if these are small amounts, most often there will be no problems. But if you receive a decent income, many times greater than the initial deposit, the withdrawal may well be frozen.

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The most interesting thing is that the broker most often has the right to do this, since the terms of use usually stipulate the possibility of suspending trading, rolling back already closed transactions, blocking an account, etc. This once again proves that the initial goal of many binary options platforms is to select client's money in every possible way.

There can be quite a few reasons why brokers block the withdrawal of money. Most often, the client is informed that bonuses for successful transactions were received as a result of a “technical failure of the trading system.” He may also be accused of “detecting an error in the operation of the terminal and using it to enrich himself.”

There may also be a requirement to prove the origin of the funds that were used for trading. Although general phrases like “You have violated the terms of the user agreement” are often heard, without specifying what exactly was violated.

The worst thing about such situations is that there is essentially nowhere to complain. Most often, binary options brokers are registered in offshore countries, so they are not subject to the influence of local regulatory authorities.

A complaint can only be filed with one of the international commercial organizations involved in resolving disputes between traders and brokers, for example, Finacom

. However, their instructions are rather advisory in nature.

This means that even if the broker’s actions are recognized as illegal, he can still ignore the regulator’s decision and not return the client’s money. In such cases, Finacom “shrugs its shoulders” and simply publishes the fact of accepting the claim and making a decision on it on its website.

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In general, you understand that you can make money on binary options by relying either on luck or on a very cool trading system, but you always need to be prepared for the fact that your winnings will literally have to be knocked out of the broker.

Why are options needed and who uses them?

Binary options can be called a simplified version of regular options. The latter represent obligations to buy or sell a product after a certain time at a certain price. The main difference between binary ones is that there is no need to actually complete a purchase and sale transaction - we are only talking about fixing changes in the price of an asset and the consequences of such a decision.

As a result, it is possible to achieve several significant advantages at once, including:

1. Minimum entry threshold. To participate in the auction, a small amount is enough, on some sites – only $5-10. And serious volumes of transactions can be achieved with an investment of $300-500. Almost any alternative stock trading options require a much larger investment.
2. Efficiency . The duration of most binary options is from a minute to several minutes. This is fundamentally different from both classic options and trading, for example, on the traditional Forex market. Due to the intensity of transactions, a high turnover of funds is achieved and, as a result, the possibility of making serious profits. It is important to remember that failure leads to similar numbers, but negative ones.
3. Simplicity . Although there are several variations of binary options (discussed in more detail below), they are all much simpler than alternative trading instruments. Even compared to Forex, where currency pairs are traded taking into account swaps, spreads, stop losses and other complex and obscure aspects to the average investor, binary options require a minimum of technical knowledge. And it takes a little time to master them.

As an intermediate conclusion, it makes sense to again recall a very important point. Trading using binary options is simple, fast and convenient. But all this does not guarantee profit and is accompanied by serious risks. The probable income is high, as is the chance of losing existing funds.

At the end of this section, it is necessary to answer the question of who is interested in trading binary options. The first thing to note is investors who do not want to wait a long time for a return on their investment or who do not have serious investment resources. For them, the above advantages of a trading instrument become especially relevant.

The second category of interested participants are brokers. They are interested in increasing the volume of any transactions in the financial markets, as they receive a commission from the turnover.

Don't forget about the third category of binary options trading participants. We are talking about scammers, the number of which is very large both among brokerage companies and those involved in conducting operations on online platforms. The general ambivalence towards binary options was mentioned above. It should also be noted here that regulators of financial markets in different countries - the USA, Canada, France, etc. – react harshly to unfair actions of auction organizers. In a number of countries, for example, Belgium and Israel, binary options are simply prohibited

What are binary options

What are binary options
Binary option

is a financial instrument that can be used to generate income (or loss) as a result of the fulfillment (or non-fulfillment) of a certain condition by the end of a predetermined period (expiration date). Most often, we are talking about the price of an asset rising above or below the contract opening level.

Binary options first appeared in 2008 on the Cboe exchange in Chicago. However, they became an officially recognized financial instrument only after CySEC (Cyprus Securities Commission) began issuing licenses to brokers to provide relevant services in 2012. Today, binary options are considered a derivative instrument for short-term trading, but in terms of the level of risks present, they are equated to gambling.

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In simple terms, options are a kind of bets on changes in the price of exchange assets (stocks, indices, futures, cryptocurrencies, etc.). If the bet is successful, the trader makes a profit, otherwise he loses the invested funds.

Typically, the amount of premium a user can receive when trading options varies depending on the asset chosen, the rules of the particular broker and the volatility of the exchange rate. The amount of possible income from binary options does not depend on the degree of change in the value of the asset. It is fixed at the time the transaction is opened and usually does not exceed 80–90%.

Most often, on sites where you can trade binary options, you can find the following types:

1. Up/down (call/put)
   are classic options in which you need to bet on the price movement in one of the directions relative to the rate at the time the order is opened.
2. One touch
   - a forecast is made that the exchange rate will reach a certain level during the transaction (in this case, further price changes do not solve anything).
3. Inside/outside the range (in/out)
   - a bet that the price will be within (or beyond) the selected price range by the time of expiration.

Real reviews

I like what Warren Buffett said about derivatives. In his opinion, this is a financial weapon of mass destruction. Of course, he was not talking about BO specifically, but about the concept in general. And he's right.

The money that circulates in the binary options market has nothing to do with real business, investing in companies and the like. This is “dead” money that flows out of the economy and hangs around in an unknown place. Everyone loses except the binary options broker.

The chief lawyer of Herbert Smith Freehills, Denis Morozov, has the following opinion: binary options by law do not have the right to be called an investment instrument. The buyer of an option is essentially betting on an event. And this is a clear sign of gambling. In the USA, by the way, they came to the same conclusion and equated trading in them with gambling.

The head of the strategic department of Dukascopy Bank SA, Daniil Egorov, stated that with all their ambiguities, binary options are a trading instrument and cannot be equated with the gaming business.

The investor knows the risks, the conditions too, and acts voluntarily, which means there can be no claims. Although practice shows that as a financial instrument, a binary option is untenable.

How to make money on binary options

Making money on binary options
How to make money on binary options:

1. Select a broker that supports this trading instrument.
2. Decide on the type of binary option and the asset whose rate you can predict.
3. Weigh the risks and open a deal, waiting for the right moment.
4. Wait until expiration to lock in your profit.

In reality, of course, everything is not so simple, since in order to carry out profitable transactions with binary options, you need to take into account quite a lot of nuances.

Firstly, when choosing a broker, you need to pay attention to its reliability in order to reduce the risk that you will not be allowed to withdraw funds after trading. Preference should be given to those sites that have been on the market for a long time, have a license from financial regulators and a good reputation among traders.

Start trading options

It will also be a plus to have awards from well-known brokerage events. You can also study broker ratings compiled by major thematic publications and websites. One of these lists is present a little lower in the text.

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Now, regarding the types of binary options and trading pairs, to reduce risks, beginners should choose classic up/down contracts and open transactions only on those assets for which high premium interest rates are set.

You cannot choose a point to enter a trade at random, since in this case trading will turn into a game of roulette. Therefore, first you need to undergo at least basic training (often available on the broker’s website), as well as study and select a trading strategy that is most suitable for the current situation on the chart. Their varieties will be presented in the following subsections.

In addition, to select a trading pair and entry point into a trade, you can use ready-made signals - sometimes they are found in the functionality of brokers’ websites, but most often you have to turn to third-party services. Typically, such services are paid and, unfortunately, rarely contain truly effective analytics and advice. Therefore, it is still better to undergo training and make decisions about entering trades yourself.

Another important point when trading binary options is that you should adhere to financial discipline and not invest your entire deposit in one trade, even if it seems 100% winning. Ideally, you should use no more than 5–10% of the funds in your account to open an order, so that if you receive a loss, you still have many chances to cover it.

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Also, you should not trade binary options during periods of increased volatility in the market, since the chance of a successful forecast is reduced significantly.

And of course, you should not enter into trades while in an unbalanced emotional state, for example, when there is anger due to receiving a large loss and you really want to “win back” quickly (tilt).

What is a profitable strategy and what should it be?

Profit is translated from English as “profit”. This is a system that will allow a trader to trade profitably. You can select it according to the following criteria:

1. The percentage of profitable trades after testing is at least 60%-65%.
2. Simplicity and a minimum number of tools for analysis.
3. Accurate signals without redrawing.

Beginners are often looking for an effective, break-even system and are even willing to pay for it. Advertisements in which a supposedly successful trader says: “I’ll sell an ironclad strategy” are often found on the Internet. But buying such a “grail” is risky. You can run into a scammer, lose the money that was paid for the author’s vehicle and your deposit. Draining strategies under the guise of being profitable are very often sold on the Internet.

You don’t have to give money to get the guru’s secret; you can learn market analysis for free.

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Binary options: training

How to learn options trading
Considering the passions described in the previous sections, it would hardly occur to anyone that binary options can be dealt with without preparation. Unfortunately, this is rarely suspected by beginners, who are lured by brokers with colorful advertising materials on how easy it is to trade options. In this case, of course, we will not be talking about trading, but about betting in the hope of luck.

In order to trade binary options and not rely on chance, it is imperative to study the basics of technical and fundamental analysis and become familiar with popular trading strategies. Fortunately, there are now plenty of options where you can get all this information.

If you type the phrase “binary options training” into Google, the search results will show all kinds of seminars, courses and even schools. Most of them will be paid, so if you are not ready to invest financially in obtaining such knowledge, you can find training videos on YouTube. You can also engage in self-study by studying books on technical analysis and stock trading.

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As a last resort, basic information on trading binary options can be found directly on brokers’ websites - most often they have entire sections dedicated to this with video and text lessons with visual examples.

Regardless of the chosen source, while studying the principles of trading, it is advisable to immediately apply the acquired knowledge in practice. For this purpose, most brokers provide their clients with the opportunity to trade binary options using a demo account

so that they can hone their skills before risking real money.

Long-term strategies

Long-term transactions are preferred by professionals, since such trading requires a large deposit.

“Breakout of the morning flat”

During the Asian session, market volatility drops significantly, and in the last working hours, when the opening of European exchanges is approaching, assets are in flat. To make money in such conditions, you must:

• Set the candlestick chart to the H1 timeframe.
• In the morning, determine the support and resistance levels on the asset in the flat.
• As soon as the first candle closes outside one of the levels, enter into a trade in the direction of its movement.

Sometimes there are false signals when, after opening, the next candle breaks the opposite level. In this case, you can reduce the loss and make a second deal with the same investment in the other direction, or double the second bet and count on profit.

Starfall

This is a strategy for trading company shares. Stock quotes, like currencies, are affected by news. Only here it is not world events that are more important, but those published by the company itself.

Unlike currency trading, when speculating on stocks, short-term transactions are ineffective. The impact of news on a corporation's image can last up to 30 days until the next one comes out. Therefore, the optimal expiration period is 5-12 days.

To conclude trades using the Starfall strategy, you first need to decide which stocks the trader will work with. It is better to choose securities of European and American companies, since they are characterized by increased liquidity.

After this, you need to wait for the report to be released. If its results turned out to be worse than the forecast, then a downward trade is opened. If it's better, get a promotion.

Binary options: trading strategies

Trading Strategies
As mentioned above, in order to make money on binary options, you need to open trades by adhering to certain trading strategies. In most cases, familiarize yourself with them and choose the most effective ones during training, and not only those related to options trading.

Strategies used by stock traders can be used quite successfully.

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The methods that work best for binary options are those methods for determining successful points for entering a trade that are used in intraday trading and scalping.

Effective trading strategies are based on the use of several technical indicators in combination with graphical analytics (interpretation of figures, candlestick patterns and patterns on the chart).

For example, a combination of their RSI, Bollinger Bands and MACD indicators works well on short time frames. Ideally, you need to wait until all three indicators show entry into a trade - the RSI is above 70 or 30, the candles on the chart pierce the boundaries of the Bollinger Bands or confidently cross the moving average, and the MACD indicates a trend change.

Example of a binary options trading strategy using indicators

In addition to trading strategies based on chart and indicator analysis, additional tactics are often used to mitigate risks. For example, on sites where it is possible to close a transaction early with a partial loss of the original bet, you can use the price lock method

. It is based on opening two transactions at once on the same asset for the same amounts, but in different directions.

As a result, when the rate confidently shifts in favor of one of the open orders, the second one is closed ahead of schedule and the trader records a small loss. But on the second deal he receives a premium, part of which covers the losses incurred. For example, both price lock orders are opened for $20. One of them closes with a loss of 20% (–$4), and the second brings a profit of 80% (+$16). Total net profit is 16 – 4 = $12 (60%).

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Even in binary options trading, popular strategies and schemes that were originally used in gambling are often used.

For example, the Martingale method

, based on the implementation of the principle of probability theory, which consists in the fact that a player cannot indefinitely receive a loss and sooner or later will make a successful bet.

In this case, a twofold increase in the transaction amount is applied after each loss until a profit is received that will cover all previous losses. In this case, the initial trade is opened for such an amount that the trader has at least 10-15 doublings of the bet in reserve before the entire account balance runs out.

In the case of binary options, you have to use a modified martingale method with an increased coefficient (x2.2 or more), since if the transaction is successfully completed, the profit will be a maximum of 80–90% of the bet, but the loss will be 100%.

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Despite the popularity of this method among traders, in reality it does not provide a guaranteed advantage due to the limited size of any deposit.

Also, in addition to Martingale, when trading binary options, the D'Alembert, Fibonacci and Labouchere betting systems are used with varying success.

We also recommend watching a video in which a trader talks about the binary options trading strategy:

Binary options trading strategy

Strategies for 15 minutes

Trading with an M15 expiration period combines minimal risks and the opportunity to make quick money, and therefore the methods presented below are among the top 10 profitable binary options trading strategies with stable profits.

Two Stochastics

This method can be implemented in the broker’s terminal if you simultaneously display 2 Stochastic oscillators on the chart with parameters 9, 3, 3 and 21, 9, 9.

Strategy based on two stochastics

Signal to buy - the indicator lines intersect, head up and leave the oversold zone.

Signal to sell - the lines are heading down and leaving the overbought zone.

For accuracy, both indicators must be taken into account. Stochastic with settings 9, 3, 3 usually shows the signal faster. If the slow oscillator does not confirm it, the trade is not opened. Expiration period: 3-5 candles. A timeframe of at least M15 will help you avoid false signals.

Signals on the chart

Absorption

To trade using this strategy, you need to set up a candlestick chart and draw a trend line. When the body of the current candle completely absorbs the body of the previous one, a trade is opened in the direction of the trend movement and the current bar. An example in the screenshot below.

Example of absorption

You can enter into trades when an engulfing pattern appears on a rebound from a trend level. There will be fewer profitable signals, but the number of unsuccessful ones is reduced to a minimum. The expiration period is also standard: 3-5 candles. You can use any timeframe except M1.

Rating of binary options brokers

The best brokers
Below is the rating of the best binary options brokers:

1. Olymp Trade - has been operating since 2014. Popular among traders from all over the world, especially in the CIS. Holder of category “A” certificate from Finacom.
2. Binomo is popular among traders from 130+ countries around the world. Since its launch in 2015, it has repeatedly received prestigious awards at the Forex Expo Awards and IAIR Awards.
3. Alpari is one of the oldest brokers initially focused on the Russian-speaking audience. It currently serves more than 1 million users from 150 countries.
4. InstaForex - has been operating since 2007. It has about 7 million active users worldwide. Winner of more than 30 different financial awards, in particular “Best Forex Broker in Europe”.
5. Binary is one of the world's oldest binary options brokers. Submits to several financial regulators at once. Licensed by the UK Gambling Regulatory Commission.
6. 24option - exists since 2009, mainly popular in Europe. Repeatedly received various industry awards. The total number of clients is more than 10 million people
7. Finmax has been on the market since 2015. Owned by the British company Morris Processing Ltd. Has a reputation as a broker with the least number of complaints about problems with withdrawal of funds.
8. Binarium is the first binary options broker launched in Russia (launched in 2012). Popular in the CIS. The number of clients recently exceeded 1 million.
9. IQ Option is a fairly popular broker in the world, launched in 2013. Licensed by CySEC. He was one of the first to introduce binary options to RuNet.
10. Expert Option - operating since 2015. Serves clients from 150 countries. Popular due to its professional trading platform and variety of options.

Author's systems for trading

The author's ones include unusual strategies for binary options that allow both beginners and professionals to earn money. They are available for free on our website. The methods are not necessarily complex, but they require non-standard indicators that are not available on the broker’s platform.

Orange - for any expiration

To implement this method, you will need a Meta Trader 4 trading terminal, as well as installed indicators and a template. After installation, the graph window will look like this:

Example of how the indicator works

We buy a Call option when:

• Histogram lines of the lower indicator Day Expl. painted white and located above the moving average.
• Day look drew a histogram up (white).
• The slow moving average on the chart (indicated by dots) is colored white.
• The fast moving average crossed the slow moving one from bottom to top.

Time to open a CALL option

We buy a Put option if:

• Day Expl is colored orange and the histogram is above the moving average.
• Day look draws the histogram down.
• The slow sliding one is colored orange.
• The fast moving one broke through the slow moving one from top to bottom.

Example of how the template works

Orange is suitable for almost any time frame, and the accuracy of the signals fluctuates around 70-80%. The disadvantage of this approach is that signals may appear infrequently, but this can be compensated for by tracking several assets at once.

WASP

The author's method, which can only be implemented in the MetaTrader 4 terminal, using non-standard indicators.

This is what the chart should look like after installing the template:

Moving averages and histogram in the terminal

The following indicators are used to determine the signal:

• 2 moving averages. They give the first signal to enter.
• Flettr - shows the presence of flat.
• AOAC Alert - indicates the emergence of a new trend.
• Semaphortrue - shows support and resistance levels (horizontal yellow line, not visible in the screenshot).

You can buy a bullish option when:

• The fast moving average crosses the slow moving average from bottom to top.
• The resistance line drawn by the indicator is far away.
• AOAC showed the emergence of an uptrend.
• Flettr has been redrawn blue.

A Put option opens when the following conditions are met:

• The fast moving average crosses the slow one from top to bottom.
• The level of support is far enough.
• AOAC says a downtrend is beginning.
• Flettr turned red.

The screenshot below shows when to place trades.

Example of how the template works

The minimum expiration period is 5 minutes. But the system can be adapted for any timeframe.

Binary options brokers

Popular binary options brokers
The most popular and reliable binary options brokers are worth considering in more detail.

Olymp Trade

Website of the binary options broker Olymp Trade
The platform for trading binary options Olymp Trade was launched in 2014. Initially aimed at Russian-speaking traders, but eventually gained fame all over the world (more than 20 million clients).

Since 2016, he has been a member of the International Financial Commission FinaCom.

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Since 2019, it has not provided services in the Russian Federation.

Today, Olymp Trade's trading turnover exceeds $170 million per month. The minimum deposit is $10. Premium - up to 92%. There are only classic up/down options.

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Read the full article: Olymp Trade: login, registration, how to make money

Binomo

Binary options on the Binomo website
A popular binary options broker launched in 2015. Currently works with clients from 133 countries ( not available in the Russian Federation since 2022

). About 40,000 people trade options on Binomo every day.

The minimum deposit is $10. You can only trade classic up/down options. Profitability - up to 90%.

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Read the full article: Binomo: entrance, reviews, how to trade

Alpari

Binary options trading platform on the Alpari website
One of the oldest forex brokers in the CIS (exists since 1998). In 2013, he added binary options to his platform.

Today, this trading tool is used by more than 1 million traders from 150 countries. Since 2022, it has no license to provide services in the Russian Federation.

There are 6 types of binary options for the trader to choose from. The minimum deposit is $1.

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Read the full article: Alpari: registration, login, how to trade on Alpari

InstaForex

Transactions with binary options on the website of the broker InstaForex
One of the brokers that became popular long before it began providing binary options trading services. Launched in 2007. Today it has more than 260 representative offices in all corners of the world. Regulated by the British Virgin Islands Financial Services Commission (FSC).

There are only standard “up/down” options. The minimum deposit is $1. Profitability - up to 82%. The number of trading pairs is 72.

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Official website of InstaForex

Binary

Trading binary options on Binary.com
Pioneer of the binary options market. Exists since 2000. In 2007 he received a patent for options trading in the United States. In subsequent years, it expands access to this trading tool for clients from almost all over the world. Winner of many prestigious industry awards.

The current active client base is more than 175,000.

There are 3 types of options available for trading. The minimum deposit is $5. Profitability - up to 75%. It is possible to close transactions early with a refund of up to 50% of the rate.

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Official site Binary.com

History of origin

The official recognition of binary options occurred in 2008 in the most developed stock market in the world - in the USA. Gradually they became more and more widespread. Following the active adoption of online trading tools, binary options are widely used around the world.

Not all experts consider them to be a full-fledged exchange transaction. This is not surprising, since most binary options are more like bets than a serious investment tool. This position is explained by the high risk of such transactions. That is why, in mid-2022, Facebook and Google made a joint decision to ban binary options advertising on their resources.

Despite the position of global digital corporations, the popularity of the trading instrument continues to grow. Including due to the emergence of several varieties of such transactions and the relative ease of participating in them.

Popular trading platforms

Brokerage companies are popular among traders, in terms of cooperation with which it is possible to invest small amounts in the monetary equivalent of several countries, in particular in dollars and rubles. Brokers with reviews from many satisfied clients are also welcome. The best representatives are shown in the table below.

Features of money management

There is no risk-free trading on binary options exchanges or any markets in general. But if a trader knows how to properly manage capital, then he can ensure not only stable, but also profitable trading. Any chosen strategy will not be able to provide one hundred percent profitability from a transaction in a constantly changing market . Aggressive, careless, emotional trading is very dangerous for your own capital. One wrong losing trade can wipe out all previous achievements and earnings.

To exclude the occurrence of such a situation, you need to adhere to the rules of risk management in your work:

• determine the level of risk, it should not exceed 30% of the trading account size;
• You need to risk no more than 5% of your initial investment per transaction;
• do not try to instantly win back after a losing trade, it is better to exhale, come to your senses, rest a little and get distracted;
• at the first stages, open no more than 3 transactions within one trading session.

Such simple rules will allow traders to protect themselves and their trading accounts from significant losses and bankruptcy.

You may be interested in: rules of investing.

Potential income, what it is and how to determine it

The potential profit from a transaction is defined as the percentage of payments under a contract for a specific asset at a given point in time. Its value is influenced by such parameters as:

• the company's trading conditions;
• type of asset;
• market volatility;
• trading session.

The trader cannot influence the amount of profitability. It is not his right to change the parameters of the agreement at his own discretion. The market player selects the investment amount, expiration date and type of contract. Its specification can be adjusted by the brokerage company. It reserves the right to change the payout percentage at any time. Only some financial institutions offer to work with a constant profitability parameter.

The higher the payout percentage under the contract, the greater the trader’s income. Statistics show that 70% of transactions are profitable, and the rest are unprofitable. To reach this level, you need to make two out of three trades in profit.

Case Study

The classic options broker set the profitability percentage at 80%. Having placed a bet of $100, in case of an unsuccessful forecast, the trader loses the entire amount. If the situation develops favorably, $80 is credited to his account, and $20 is the commission of the brokerage company.

Pros and cons of trading BO

The downside of options trading is the difficulty in choosing an honest broker who faithfully fulfills its obligations. Therefore, before replenishing your account, you should carefully analyze the financial organization in all respects, since the trader’s profit directly depends on the accuracy of fulfillment of the terms of the contract.

Among the disadvantages of the earnings format, one can note the incommensurability of the potential amounts of profit and loss in a direction unfavorable for the trader. This requires high quality forecasting, which is difficult for new market players to achieve.

Most brokerage companies offer to make quick money by concluding a contract to purchase an asset with an expiration time from 30 seconds to an hour, and it is extremely difficult to predict price movement within such a narrow framework.

The advantage of options trading is that it is accessible to anyone. To start working you don’t need to have certain skills or a lot of funds to invest. Most brokers have a low threshold for becoming a client.

The technical capabilities of the trading platform allow you to adjust the parameters of risks and profits. The trader does not need to analyze them; at the time of concluding a transaction, they are set automatically, in accordance with the terms of the brokerage company. He is asked to choose from a huge variety of assets suitable for his strategy.

Due to the large number of brokers on the market, a fiercely competitive environment is being formed, and they strive to stand out with their loyalty, offering bonuses on replenishment, no deposit accounts and other options that can be used to make a profit.