How to Make Money on the Binary Options
How much can you earn on binary options? As a rule, if you choose the right trading strategy and will strictly follow its rules, you can earn about 100% - 300% of the investment per month. That is, if you make an investment of 1,000 USD, in a month you will already have 2000-4000 USD on your trading account. However, you should not cherish vain hopes if you do not truly understand the essence of binary options. Binary options’ trading is the same work as the work of a taxi driver, builder, doctor or accountant. The only question is the method of this work, as well as the fact that binary options will bring you much more profit than any other ways of earning money. However, binary option’s trading is not a game, but it is a highly profitable financial activity which, at the same time, is associated with high risks.
What Should You Start with?
There is a common algorithm of action which you should use while starting your work on binary options. Here are the necessary steps without which you can’t start binary trading.
Choosing a Reliable Broker
To begin with, you need to decide on the brokerage company that you will trade with. This choice will depend on several important points: If you have sufficient funds to start trading, choose a broker who offers:
- good choice of options (classical binary options, 60 seconds options, Range options, One-Touch options, the long-term options, etc.). This is important because you need to have a choice of ways to trade with good conditions during the trade;
- sufficient choice of financial assets. Please note that the brokerage firm should have a lot of tading tools to choose from in terms of selection for trading asset. You need a broker with a selection of assets not less than 50 items. Of course, you won’t need all the proposed list. However, before you start trading, you have to decide what 3-4 kinds of assets you should choose for continuous trading.
- availability of quality training. Choose a brokerage company with a sufficient package of training materials and do not be lazy to learn them. Only in this way you will be able to improve your professional skills. In addition, the presence of a good training confirms the status of the company. The better is the training, the better is the image and professionalism of the company.
- the presence of a demo account. If you want to start your career as a trader, trading directly in the real world, discard this thought out of your head. To start trading on a live account is a quick method of loosing the deposit. Find a broker company with the possibility of using a demo account and work on your strategy, try to understand the market and the characteristics of the price movement. You must trade in the demo mode for at least 2 months. Resist your greed and try not to "break" in the market to make money fast - it is a utopia.
- trading terminal. Today, there are 3 main types of trading terminals which are provided by the brokerage firms to trade binary options, namely: TRADOLOGIC, SpotOption and Meta Trader4.
- do not invest a lot of money at once. Choose a brokerage company which will add its 100-120% of the deposit amount to the sum of your deposited funds. It is possible. Thus, since you deposit 200 USD on your account, you will have 400-450 USD using the bonus program. That is, choose a broker with the best bonus program;
- get a brokerage company that offers no deposit bonus. So you can try yourself in option trading without investing a single penny from your own funds;
- select a brokerage company which requires a minimum deposit to start trading and the minimum deal for trade. There are companies that allow to trade binary options starting with 10 USD on your account. In this case, the minimum transaction is 1 USD;
- start trading with a demo account. Essentially it has no differences from the real one, except that the funds in it are not real but virtual.
Choosing the Trading Strategy
Once you have chosen a reliable brokerage company based on the amount of cash you have or for some other reasons, it is time to stop on the trading strategy which you will trade with. At the same time, if you are going just from time to time enter the shopping area of the broker and intuitively make some deals, you can save your time. Binary options trading requires strict strategy. Not just a strategy, but a profitable strategy, which can be used every day to replenish your trading deposit.
There are the following trading strategies:
- with the indicator;
- without the indicator;
- counter trend,
- as well as strategies that are based on the types of options that they use.
If you are, on the contrary, a prudent and calm person with a mathematical turn of mind, a mathematical strategy or medium-term trading strategy may fit you. Once you have picked up some strategies for trading, proceed to their testing.
The testing of strategies
This is quite extensive and serious question. You can read here how to do this.
However, we can assure you that you need this testing for the following reasons:
1. Some of the strategies that worked a year ago are now no longer working, as the markets have a feature to change (for example – the market had previously been trending, which lasted for six months, and now it is flat. With this fact the trading strategies for these markets are different).
2. There are strategies that will never make a profit. Such strategies can be placed on Internet resources by the traders to discuss the improvements of them.
3. During the test you will better understand all the nuances of this strategy, its profitability, as well as the fact whether it is necessary to apply this approach in trading.
4. It is through testing you can find out whether your direction in trading is correct or not, will it make a profit or lead to "nowhere" in advance.