Trading binary options might be confusing for most individuals, who have no economic and/or financial orientation. Online trading on the financial markets is usually common for people working in the financial sector, who are familiar with the markets.
Fortunately, online binary trading opened up this world to individuals who are interested in extra earnings by making it available in a simple and intuitive form. Now, anyone could be a trader and you only need to know the basics in order to trade binary options.
The basic steps to follow binary options trading are:
• Open an account and make a deposit: the minimum deposit varies depending on the broker and commonly starts from just $100. A decent first deposit for an amateur trader is around $500, this bankroll allowing you make enough trades just to understand how it really works without risking too much. The most popular deposit methods are credit/debit cards and wire transfers.
• Buy options: in the trade area of the online platform is a list with the available binary options for each asset. For ready-made options you only need to enter the amount to be invested, choose “Put” or “Call” and click the “buy” button.
For customized options you also need to choose the asset and select the expiry time (e.g. 5 min, 1 hour, etc.).
Note: “Put” is for the option in which you predict that the price at the expiry time will be lower than the price at the time of purchase and “Call” is for the case in which you predict the expiration price will be higher than the price level at purchase.
• Verify the outcome: when the option reaches the time limit it expires. There are two possible outcomes: “in the money” – if your prediction was correct and“out of the money” – if the option was unsuccessful. If the option expires in the money, the payout is made instantly and you can see the money in your current balance. Several brokers offer a refund for “out of the money” options that could be as high as 15%, so even if you lose, you still receive a small amount of money for your options.
• Withdraw you earnings: once you earned a significant amount of money and you want to see it into your bank account you just ask for a withdrawal. The money should reach your personal account in a few days but remember to check out the broker’s policies.
The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.