Some of you veterans in the financial world have probably heard of binary options. What are binary options? According to Wikipedia, a binary option is a financial option in which the payoff is either some fixed monetary amount or nothing at all. The two main types of binary options are the cash-or-nothing binary option and the asset-or-nothing binary option. Binary options are high risk financial instruments and not everyone is suitable for trading such products.
So the big question you may be asking,” Is binary option trading profitable over the long run?” The simple answer is, “Yes.” The more complicated answer is,” It takes years of experience trading the markets, mentorship from an experienced mentor, some financial losses from your mistakes and past performance is not indicative of future results.” Why is that so? Because the markets are always changing.
Personally, I have explored this route of trading so that I can potentially make more money from my current job. The platform I used is IQ Option and I have paper traded for a few months before giving it up as a money making activity. The reason is because no matter what strategy you are using, whether it is Bollinger Bands, moving averages, RSI or stochastic indicators, there will be some instances in the market where it won’t work. I have also tried trading using the Martingale strategy where you increase your trades to compensate for the previous failed trades. I did make some money out of such strategy in paper trading but there will always be that one day where I would return everything I profited back to the market.
In my opinion, unless you are a seasoned trader or award-winning hedge fund manager with an edge in the markets, I don’t personally recommend retail investors to trade in binary options. First of all, it can be quite a stressful experience trying to beat the market all the time. Also, it is almost impossible to develop a crystal ball to predict which trades you would win and which you would lose 80% of the time to be profitable. You can win some trades in a day, a week or even a month. But to consistently win year after year is no easy task. If you are looking for an easy way to make easy money, binary options is not that option. You could make or lose money very easily in a matter of minutes. Bear in mind that binary options are a all or nothing option and unlike traditional options, you can’t sell them in the market if your trade is losing money. This makes trading binary options a very risky activity. You could lose all of your capital trading them. As a disclaimer, I am not responsible for any poor or stupid decision(s) you make trading binary options and any financial loss you incur on such products should you want to trade.
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