An Introduction To Binary Options Trading or Fixed Time Trading
People are frequently looking for methods to invest apart from purchasing stocks, and one method that sometimes comes up is Binary Options Trading or Fixed Time Trading. This type of trading includes a variety of assets like stocks, Forex pairs, Gold, Silver, and other assets. But the specialty of Fixed Time Trade or Binary Options trade is that – it is usually not a long-term investment, and it is more about a short-term guessing game.
How does It work?
Binary trading or Fixed Time Trading is about attempting to forecast the price of an asset at the end of a provided time frame. It is often referred to as gambling or, more particularly, sports betting due to this. When you wager on a sporting result, you’re wagering a provided amount of money in the hopes of getting it back, plus a proposed commission if you’re right. And if you’re incorrect, you lose the whole amount you invested. This is how binary trading works and is why it’s referred to as binary implying an all-or-nothing result. It is also known as Fixed Time trade due to the fixed time expiry of such trades.
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Is Binary Options or Fixed Time Trades a Scam?
There are Binary Options brokers, Binary trading robots, and signal providers that are unreliable and false. The aim is not to reproduce the idea of binary options based only on some fraudulent brokers. The perception of these financial instruments has endured as an outcome of these operators. But, regulators are gradually beginning to execute and find the culprit, and the industry is being cleaned up. The best thing you can do to avoid Binary Options scam is by selecting from the well-established brokers and avoiding the new brokers. These simple tips can avoid anyone from scams:
- Marketing assuring huge returns – This is an obvious warning sign. Binaries are high risk or high reward tools – they are not a “make money online” plot and should not be marketed as such. Administrators making such calls are possible to be unreliable.
- Know the broker – Some regulators will filter new customer to a broker they collaborate with, so the individual has no idea who their account is with. A trader should recognize the broker they are going to trade with.
- Cold Calls – Expert brokers will not make cold calls. They do not sell themselves in that means. Cold calls will usually be from unregulated brokers absorbed only in taking an initial deposit. Continue with great caution if joining a company that got in touch this way. This would include email communication as well or any form of connection out of the blue.
- Terms and Conditions – Read the full terms and conditions when getting a reward or offer. Any will involve securing in an initial deposit until a high amount of trade has been executed. The first deposit is the trader’s cash. Genuine brokers would not declare it as theirs before any trading. Some brokers also allow the option of dropping a bonus if it does not suit the demands of the trader.
- Don’t let anyone trade for you – Never allow any account manager to trade for you. There is a definite struggle of interest, but these agents of the broker will reassure traders to make huge deposits and take higher chances. Traders shouldn’t let anyone trade on their part.
Is It Gambling?
It is a common question that people ask often regarding binary options, and it’s right to ask. The sports betting resemblance makes it seem more like a game of luck and less like an investment. A lot of what we do daily is gambling, including common forms of investment. There is always a danger, the chance of a reward, and opportunity in between. The binary character of this type of trading can surely make it feel a bit more like a wager. But, so long as traders make trading decisions based on market trends and proper analysis, this isn’t anymore more like gambling. A well-analyzed Fixed Time Trade or Binary Options trade is similar to any other form of investment.
This will rely totally on the trading practices of the trader. With no plan or study, any short term investment is going to gain or lose based solely on luck. However, if a trader practicing a well-researched approach, it will guarantee that they have given all they can to avoid depending purely on luck.
Binary options trades are risky in nature, but they can as well managed to make trades based on cost and anticipated earnings. So the response to the question of whether it is gambling depends upon how the trader handles it – purely by luck or well-researched trading.
Finding the best Binary Options or Fixed Time Trade Broker
Options scam has been a vital predicament in the past. Crooked and unlicensed operators used binary options as a new foreign consequent. These companies are thankfully waning as regulators have eventually started to move, but traders still need to look for regulated brokers. Here are some tips that can help you resolve which broker is best for you:
- Analyze all brokers – balance the highlights, profitability, and safety of funds with all recommended brokers.
- Rewards and Offers – make sure you know the conditions of getting additional money as a bonus or other offers.
- Low minimum deposit brokers – you can trade for real without having to invest considerable sums of money.
- Demo Accounts – test a trading platform live without putting money at all.
- Islamic Binary Brokers – if you are one of the increasing numbers of Muslim investors, discuss Islamic trading account.
Regulation of Fixed Time Trade Brokers
While hesitant to respond to binary options initially, regulators worldwide are now beginning to regulate the business and make their presence known. The major regulators today include:
- (FCA) Financial Conduct Authority – UK regulator
- (CFTC) Commodity Futures Trading Commission – US regulator
- (ASIC) Australian Securities and Investments Commission
- (CySec) Cyprus Securities and Exchange Commission – Cyprus Regulator, usually accepted in the EU and under MiFID
There are also regulators running in Malta, st vincent and grenadines and the Isle of Man. Various other officials are promptly taking an extreme interest in binaries especially, particularly in Europe, where local regulators are sharp to sustain the CySec regulation. Many of the regulated brokers have a separate entity to provide services outside the regulated jurisdiction like Asian, African and other countries. Unregulated firms still run, and while some are reliable, a lack of regulation is an obvious warning sign for potential new customers.
Advantages of Binary Options or Fixed Time Trades
The main advantages of Fixed Time trading or Binary Options are the clarity of risk and reward, and the structure of the trade.
Minimal Financial Risk
If you have some experience in the forex market, or CFD trading involving crude oil or spot metals such as gold or silver, you would have learned one thing: these markets are very risky and can easily blow off your account. The leverage, margin level, high impact news events, slippages and price re-quotes, etc. can affect the trades negatively. Whereas the situation is different in Fixed Time Trades or binary options trading. There is no leverage involved, and slippage and price re-quotes in binary Options trading, it reduces the risks involved in binary options trading to the barest minimum.
The Fixed Time Trades or binary options allow traders to trade financial instruments like currency and commodity, indices, and stocks with low investment od $1 per trade. This flexibility is unique and empowers traders with better manageability while trading. Binary Option is a one-stop solution to trade a wide range of instruments with the flexibility of trading with a minimum amount of $1.
A binary option or Fixed time trade’s outcome is based on just one parameter: the price direction. The trader is actually betting on whether the price od a financial asset will move in a particular direction. The trader also has the liberty to determine the time frame by setting an expiry time. The trader need not worry about huge drawdown, unlimited potential loss, or spotless settings. The simple thing in binary options is that the trader always knows the possible loss or profit before they place a trade. In Binary Options, the trader has less to worry about than if he were to Forex or CFD markets.
Greater Control of Trades
The fixed time trades or Binary Options trades have better control over investment. The trader is always aware of what he stands to gain or lose if the trade is in-the-money is out-of-the-money. This is not the case while trading in the forex market. The Forex trading can bring huge losses because of a high-impact news event, any other global political or financial developments.
The fixed time trades or binary options offer a payout of up to 95% in case of a successful trade. Some brokers offer payouts of up to 90% on a trade. The payout is dynamic in nature and depends on liquidity in the market. The ROI is much higher in BinaryOptions as compared to Forex with the same level of risk.
The forex or commodities markets trading requires at least $500 to $1000 deposit to start trading. The trader should have a reasonable amount of margin money to support their trade in a volatile market. However, binary options or Fixed Time trades have much lower initial investment requirements; some brokers allow traders to start trading with as low as $10.
What Are The Best Trading Strategies?
Binary trading or Fixed Time Trading tactics are different from other types of tradings. We have discussed a few strategies in our strategy section, and there are approaches that traders can test with. The technical analysis is valuable to some traders, coupled with charts, indicators, and price action analysis. Money management and risk management are extremely important while trading. Never trade more than 5% of your capital in any single trade. Various styles of trading will match different traders, and they can modify the strategy and develop a new strategy that works for them.
There is no particular best strategy. Traders require to ask themselves questions about their investment plans and risk capacity and then determine what works for them.