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All About Binary Options Robots
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Binary options robots, often known as binary trading software, are automated or semi-automated trading programs that traders can use for more convenient trading. In our binary options robots guide, we will answer many questions that are common among traders of all kinds. In detail, we will take a look at these questions:
- What are binary options robots?
- What is the difference between binary options robots and binary trading signals?
- What is the difference between various binary trading software?
- How much does trading with binary robot cost?
- Why do I need a binary broker to use the binary trading software?
- Are binary robots worth the money?
- What is the best binary software on the market?
Once you know the answers to these questions, you will be able to make an educated decision on whether to use a robot, which robot to choose, and how to use it.
What are Binary Options Robots?
Simply put, binary options robots are computer programs that find the trades you. A robot can analyze the market, find profitable trading opportunities, and allow you to make trades on the same dashboard. As a trader, you can control crucial settings on your preferred software, for example, the investment per trade, the money management strategy, and the assets the robot monitors.
It is important to understand that there are binary trading robots that cost money and robots that are completely free of charge. Which one will you choose is only up to you but keep in mind that trading with more expensive software does not mean you will achieve better results and more profit.
In order to actually place a trade, every trader needs a binary broker. Not all binary trading software are compatible with all binary brokers. This limitation is due to technical compatibility issues, which are not that different from a European trying to use their power plug in the United States and vice versa but are little more complex.
As long as you trade with a trustworthy broker and with a good binary options software you can expect to have a better trading experience than when you are trading with scam binary products.
What is the Difference between Binary Options Robots and Binary Trading Signals?
In the past, the difference between binary options robots and binary trading signals was quite distinctive. While binary trading software provided completely automated trading experience, binary signals required more manual action. This means that binary options robots were offering more dynamic trading environment. Unfortunately, this also means that there were many binary scams that placed trades even when the trader was offline.
We highly suggest avoiding auto trading robots that are reducing your level of control during the binary options trading process. It can be somewhat difficult to resist the urge to rely completely on auto trading software, but keep in mind that you are the one who made a deposit, and you should have the last vote on which trades should be placed.
Now, the difference between binary options signals and binary options software is less and less significant. Binary signals providers allow traders to place a trade directly on the dashboard, and binary trading software is more oriented on semi-automated trading that requires from trader to be online and understands the process of trading.
What is the Difference between Various Binary Options Robots?
There are hundreds of different robots out there. To find the right robot for your needs here is what you have to know about the differences between robots.
Computer programs vs. human traders
Most robots use computer programs to analyze the market for you, some use real-life traders, and some use a combination of both. Each type of robot has its advantages and disadvantages, and which one you should choose depends on which type you feel the most comfortable with.
Top Binary Options Broker 2020!
Perfect For Beginners and Middle-Leveled Traders!
Free Education How To Trade!
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Computer programs are the purest way to perform technical analysis. Undistorted by human interference, they can analyze the market all day long, create the most signals, and monitor the most assets.
Real-life traders offer a plus in adaptability that many traders like. They can choose which strategy suits the market best at every time and do not tackle every situation with the same strategy, as a robot sometimes would. While they can execute fewer trades in the same time and might make mistakes, many traders prefer the human element over computer generated signals.
Combinations of real-life traders and computer programs try to combine the advantages of both methods. The important thing is that you are aware of these differences and choose a service that fits your needs.
Free robots vs. paid robots
It is no secret that competition in the binary industry is pretty tough. This means that many binary products are faced with the issue of forming a lucrative price. Traders will face free binary options robots and paid binary software. Unfortunately, there is no unique advice regarding the question which binary robot to choose.
Price is not a sign of quality, and we always encourage traders to research whether or not the product is worth the money. Besides, there are many free binary trading robots that require no additional payments. Why pay something you can get for free?
Online Robot Trading vs. Offline Robot Trading
Some binary options robots can take over your entire trading process – they find trading signals and execute them for you. They will trade for you even when you are offline. Sounds like an amazing opportunity? Think again. This means that you lose all control over your binary options investment.
On the other hand, there is binary trading software that encourages traders to perceive and make a decision on every trade. It is impossible for them to place a trade without the manual action. The trader has to, one way or another, accept or decline every trade delivered. It is impossible for a robot to place the trade without a prior approval. Of course, there are many once popular robots and signal providers that shut down due to not being able to adapt to new trends: BinaryRobot.ws, ForexRobot.ws, OptionRobot, Automated Binary, Simple Auto Trading, Binary Copier, Binary Signals Trader, SignalSamurai, Quantum Binary Signals, John Anthony Signals, Winning Binary Signals, Auto Binary Signals, Binary Options Pro Signals, Trader’s Buddy.
How much do Binary Options Robots Cost?
As already mentioned, prices for binary options robots can vary greatly. Also, the payment principles may vary. There is binary trading software that charges only a one-time fee, and binary robots that charge a monthly fee. If you decide to trade with such binary options robot, make sure to understand that it is an additional investment in your trading. This fact can be somewhat demotivating for beginners and traders who don’t have significant funds at their disposal or simply want to start with smaller sums.
Why do I need a Binary Broker to use Binary Trading Software?
Many traders believe that it is possible to execute binary trades simply by using the robot. However, robots are only platforms that are welcoming both binary brokers and traders in the trading process. They deliver the trade but they don’t offer it. The broker does.
To put things simply, binary brokers generate hundreds if not thousands of trades. Traders sometimes find it difficult to find the right one. With binary trading software, the entire process is much easier, as they select trades and deliver them to you. The trades, however, is still placed with the binary broker.
Many traders seem to like to select the broker first, and then the binary broker, but that is not the right way. In order to trade with binary software, the trader first has to open a binary trading account with the robot, and then select a binary broker offered. The opposite process, where the trader first registers with the broker and then looks for a binary trading robot hoping to find one that is suitable is not possible. There is a technical limitation in connecting your trades, binary software and binary broker that requires from binary traders to open an account with the binary trading software first.
As always, binary options broker that will be used for trading with the binary robot should also be reliable and trustworthy. Trading with regulated, safe, trustworthy brokers who have clear terms and conditions can always be recommended. As in life, in binary trading users should also rely on services that are already proven to be superior and reliable in every aspect of their business.
Are Binary Options Robots Worth the Money?
It is impossible to provide a unique answer to this question. Every trader is different and has different goals and needs. There are traders who place the trades only to experience the trading rush, the excitement fast paced trading brings. There are also traders who are calculating, developing strategies and are very studious in their approach. Of course, there are also traders who rely only on luck.
For this reason, it is impossible to say whether or not the binary robots are worth the money. However, this dilemma can be avoided if traders choose to trade only with free binary software. As there is no cost, traders can simply decide to open an account with a reliable and free binary robot, such as Binary Options Robot, and trade with one of the brokers supported on the dashboard.
There are also traders who firmly believe that binary trading software will bring them easy money and help them become millionaires overnight. Such traders are often victims of different scams that are lurking around for naïve and confused users. No matter how advanced the binary trading robot might be, we strongly recommend traders to understand all the features, risks and opportunities before they start trading. Also, don’t believe any promises regarding high profits, unless you calculated them by yourself as past performance is not the indicator of future success.
How to find the Best Binary Options Robot for Me?
Every day dozens and dozens of new binary options robots appear. They all claim to be the best, so it is completely understandable that traders often feel like they are in front of the wall. If every binary robot claims to be a perfect choice, then which one really is?
Even though it may seem that there is no solution to this process, there is. Traders simply have to learn how to recognize a high-quality product.
Trading Terms and Conditions
Legit binary options trading software always have a document called Terms and Conditions (also known as T&C, or Legal). This documents defined the relationship between the trader and the binary trading software. It is of crucial importance to find a binary robot with clear terms and conditions. And if you don’t understand something, don’t be afraid to ask!
Good products will have good reviews, and their users will be happy to share their experience with others on forums and social media. Still, it is important to accentuate that some traders don’t understand the binary trading process and simply feel disappointed even if the product is good. Be objective when it comes to users’ experience and try to find the optimum solution.
Great binary trading software always has an amazing interface that easy to understand even for beginners. A good overview is very important for binary options traders who want to know what is going on in every moment. Also, good customer support is something that many traders consider to be utterly useless. However, customer support is the first stop when they look for help.
Great customer support can help you understand all the features and benefits that your binary options software delivers you. Make sure to ask them what you need.
Educational materials can be helpful as well. They can increase traders’ knowledge and help them be more successful binary options traders. It is impossible to make progress without the understanding of binary options markets and movements.
Every trader should be in charge of their own trades! This is a basic principle that should always have the priority over the others. While there is some good fully automated software, it is always better to choose a semi-automated trading solution that will help traders be in charge. Find a binary trading robot that offers you customization possibilities and many different features, as well as the benefit of approving your own trades.
Avoid software that trades without you or even if you are offline.
Binary options robots can change your trading and be your helpful friend on the way to profitable binary options trading. Still, as always, be realistic and focused during trading to avoid any misunderstandings and scams. Binary options robots are a way better solution when the trader understands the basic principles of trading than when the trader is focused only on easy money. Robot trading is only a tool and not the complete solution.
Best Binary Option Robot Review 2020
OptionRobot is one of the popular binary options trading software available today. But given that many auto trading software available often turn out to be scams, does OptionRobot stand out as legit software? Read on for a best binary option robot review 2020 plus tips and FAQs regarding the software.
This binary options trading automation software is the first of its kind to work on leading online brokers like Binary Online, Option500, Plus Option, Greenfields capital, 72Option and Stockpair.
The software design implements up to 6 different technical indicators that include trend, Stoch diagrams and CCI indicators. Many scam trading software will often mask their inefficiency by claiming use of a complex algorithm. Users of such software often discover too late that they invested in fake software which doesn’t deliver returns as promised.
Getting started with OptionRobot
Option Robot usage isn’t limited to citizens from a specific country or specific brokers. This makes it easy for you to use the software to make trades from anywhere on the globe. One of the things that stand out on the signup page copy is the lack of overhyped marketing material. Unlike many binary options trading automation platforms, you won’t get guarantees about earning over $1,000,000 by just running the software. Instead, the copy provides enough information regarding what it is and how to get started.
OptionRobot is easy to use. Despite being a binary options trading automation software, control largely remains in the traders hands. This makes it easy for you to place trades based on your chosen trading strategy. You can also easily turn the auto trade option off. In addition, you can customize the software to place and exit trades at predetermined time intervals.
If you’re not ready to invest in binary options trading software, you’ll be glad to know that Option Robot is free to use. Unlike competing software which requires you pay upfront before using them, Option Robot can be used by anyone with or without money in their trading accounts.
General Risk Warning! your capital may be at risk
Best Binary Option Robot Review 2020
The OptionRobot binary options trading robot has set itself apart as one of the few legit trading automation platforms available today. In an industry where software creators try to trick traders into buying poor quality scam products, Option Robot focuses on transparency and credibility. Here’s the complete review of this software.
Unmatched user control
One of the major shortcomings you’ll find in common trading bots is the limits they place on user control. This means that traders often find themselves trusting bots with complex algorithms to manage their entire trading accounts.
Option Robot doesn’t limit the amount of control you have over your finances. In fact, you can easily adjust the software settings to match your preferred trading style. Features you have control over include trade expiry, trade amount and ability to allow the software enter and exit trades automatically.
Free to use software
Using OptionRobot will not cost you anything. To get started, simply create a new account. Once complete, you’ll find a “TRY DEMO ACCOUNT” button within your user interface. Clicking on this button directs you to the free account that’s initially credited with $1000 virtual cash.
Implements familiar technical indicators
Which are your favorite technical indicators? Having easy to read indicators is one of the factors which can affect the profitability of a trade. Option Robot implements 6 different technical indicators that include CCI, MACD and the RSI indicator. The platform is designed such that if you set more than one indicator during a trade, the bot will only generate a signal when all indicators are identical.
What’s more, this platform also offers three popular money management systems including the Fibonacci, the Classic and the Martingale system. Each trading system makes it easy for you to easily adopt your trading style to the software. For example, if you love to minimize the risk involved in every trade, using the classic system is recommended. If accuracy is you primary concern, the Fibonacci system will be your best bet.
Link with 9 different binary options brokers
Broker compatibility is one of the major challenges traders have to overcome when dealing with binary options trading automation software. Option Robot software can be linked with 9 different binary options brokers. These include Opteck, binary Tilt, Stockpair, ZeusOption, BD Swiss, Dinero Libre, BinaryMate, Binary Online and 10Markets..
Being able to link the software to different brokers has several advantages.
– You can use the software to automate your trades from anywhere in the world. That is, if a specific broker doesn’t accept traders from your country, you can easily switch to a different broker that accepts traders from your country as well as supports the OptionRobot software.
– You have more control over trades including the trade size amount and trade expiry periods.
– Switching from one broker to another one doesn’t require you close your Option Robot account.
Excellent trader support
OptionRobot staff has gone to great lengths to ensure that any trader using their software is fully satisfied. Their free account is a true testament to this. However, there are additional customer support features that stand out.
Simply visiting the OptionRobot website triggers a live chat app where you can easily ask questions. The chat feature is available 24 hours and messages are replied to almost immediately. You can also access their customer support team via email.
The platform also offers a detailed FAQ section as well as a blog which can be used as a trader’s resource.
Only trade currency pairs
Option Robot seems to be totally focused on forex currency pairs traders. This means that you cannot use the software to trade other asset types like commodities and indices. In addition, the software can only be used to trade 8 different currency pairs.
Enter simultaneous trades
To maximize profit potential, you’ll want to have several trades running concurrently. Option Robot makes it easy for you to enter into 1 to 8 different trades at the same time. You can also set the trade amount through the software’s settings section. The minimum trade amount is $5 while the maximum is $1250.
Option Robot advantages
– Option Robot software is free to use. The only requirement is that you have an active and funded trader account with one of the brokers that support the software.
– Ability to link to 9 different reputable online brokers makes it easy to switch between brokers
– Up to 6 different technical indicators and 3 different trading methods make it easy to use your preferred trading strategy
– Easy to customize the software to match your trading strategy through the settings section
– Excellent customer support with live chat and email accessibility
– Browser based software doesn’t require downloading anything and is accessible through different internet enabled devices
Disadvantages of Option Robot
– Some claims of demo account being designed to provide unrealistic returns and entice traders to sign up for real account
– Software only allows for trading in 8 forex currency pairs shutting out traders interested in trading other assets
Overall, Option Robot is one of the top binary options trading automation tools on the market today. As a trader who wants to use this software, you’re probably wondering how you can best leverage the software to maximize profit potential. Here are 8 tips to help you out. General Risk Warning! your capital may be at risk
OptionRobot usage tips
Trading automation software should not be used to completely replace your trading strategy. Many traders make this mistake and end up losing their entire account balances. Binary options bots are never 100% accurate. This fact alone means that as a trader, your input before executing any trade will be necessary. If you’ve signed up with Option Robot, your chance for profiting is significantly higher compared to using other competing software. Why?
OptionRobot gives you a lot of control over its settings and therefore won’t have to rely on pre-set algorithms which can easily lead to trade losses. But how can you actually leverage the Option Robot software to increase chances of winning majority of your trades? Here are 8 tips.
1. Do not over rely on the auto trade feature
The auto trade feature might come in handy when you’ve learned how to use the software and have come up with a solid trading strategy. Even then, the auto trade feature needs to be used sparingly during the first months of trading. Initially, your focus should be placed on learning how to use the different software settings and see how they affect your trades.
2. Always conduct fundamental analysis before trade entry
The technical analysis tools offered by OptionRobot are meant to give you a glimpse about the movement of a particular asset. These are supporting tools and they should be used alongside fundamental analysis to get a clear picture about possible asset price movements. Fundamental analysis involves identifying news or events that might affect change in an assets price movement. Such information can be sourced from news, market reports and press releases. Unfortunately, trading software isn’t designed to perform fundamental analysis and it’s therefore up to you to do it manually.
3. Avoid investing in neutral markets
Neutral markets are characterized by little or no price movements. This means that entering a trade will most likely result in zero or no profits. To make the most profit, set your software to enter and exit trades when the signals indicate a bearish or bullish trend.
4. Always try to invest in low volatility fx currency pairs
Option Robot has done a great job by allowing traders to invest in only 8 of the leading currency pairs. However, you’ll also need to play your role in distinguishing between the most volatile and least volatile pairs. Remember that price volatility can change in an instant for example, in the event of a natural disaster. It’s therefore essential that you keep track of a specific currency pair’s history and if it has seen low volatility for a good amount of time, you can go ahead and trade in it.
The reason why trading in low volatility currency pairs is recommended is market changes usually won’t result in huge price movements. As such, you can easily protect yourself from incurring huge losses due to a small market change.
5. Using Option Robot doesn’t mean you throw your account management strategy out the window
Use the OptionRobot free account to test different account management strategies. For example, consider investing a maximum of 5% your account balance on a single trade while you get accustomed to using the software. This means investing a small amount per trade if you open multiple positions at a time.
6. Avoid the lure of opening multiple trades simultaneously
Option Robot allows traders to place up to 8 different trades simultaneously. This could lead to overtrading. That is, you might be tempted to open a high number of trades in anticipation of huge profits. Huge profit potential is always accompanied by huge loss potential. It’s therefore recommended that you have 2 to 4 open trades at any given time. These are easier to keep track of.
7. Always test before executing any new trade strategy
With binary options trading and especially software, nothing is cast in stone. You might easily come across new hot trends and tips regarding a specific currency pair or even a profitable strategy you can implement using OptionRobot. Never execute any hot tip without testing it first. Option Robot is free and testing out new strategies and tips is one way to make the best use of the software.
8. Be wary of using the Martingale trading system
The Martingale trading system is designed to allow faster profits generation from successful trades. However, the risks involved are unusually higher compared to using the Classic system or the Fibonacci system. Analysis of the Martingale system shows that it goes against prudent trading account management strategies and should therefore be avoided if you’re to grow your trading account steadily.
Practical example showing how to enter a profitable trade using OptionRobot software
Before entering a single trade, always make custom settings on the OptionRobot settings panel. Using the aforementioned tips, here is a practical example you can copy.
How long a trade will run really depends on your trading strategy. However, I’ll usually hold a position for 60 seconds to 10 minutes. My preferred trading method is Fibonacci due to the accuracy it offers.
I’ll usually have more than one indicator chart running simultaneously. This will further ensure that the software only enters a trade when it receives an identical signal from all open technical indicators. My favorites are the RSI, MACD and Stochastic indicators.
I will usually use a maximum of 5% of the total account value on a single trade. In addition, I never have more than 2 open trades running simultaneously. With regard to the currency pairs I select to trade at a particular time, my choice is largely determined by the currently open market. For example, if the London session is open, I ‘ll usually choose to trade European currencies as opposed to the USD or CAD.
This example seems pretty straight forward. However, sticking to a specific strategy and only changing it after testing out a new strategy isn’t quite easy. There’s always the emotional element of the trade to contend with. For example, what do you do if you enter into three consecutive losing trades? A good strategy would be to stop trading for the day, go back to the drawing board and analyze the trade histories. Then come up with a trading strategy for the next day. However, this is easier said than done. Most people will try to reverse their losing streak by placing new trades which could lead to more losses.
General Risk Warning! your capital may be at risk
Option Robot FAQ
Q: What is OptionRobot?
A: OptionRobot is a browser based binary options automation software. Opening an account with Option Robot is free. The software works by entering and exiting trades on your behalf on a number of selected online brokers.
Compared to competing binary options trading bots, traders will find it easier to customize the software to match their trading styles. It offers 6 different technical indicators and 3 different trading systems to choose from. In addition, the software can be linked to 9 leading binary options broker platforms.
Q: Is Option Robot a scam?
A: OptionRobot offers several features which indicate that it’s legit software that traders can use to make profit. Opening an account doesn’t require that you invest some money. In addition, it includes a demo account which allows you to test the platform without investing your own cash.
This software doesn’t place limits on users’ ability to customize it to match their trading preferences. Like with other trade automation software, using OptionRobot doesn’t guarantee that you’ll profit from all of your trades. However, it includes unique features which if leverages properly, can see you profit from a huge percentage of trades entered.
Q: What devices can I use to access the software?
A: Option Robot is browser based. This means that you can access it via any internet enabled device including your smartphone. Also, you don’t have to download any app to access the platform.
Q: Do I have to pay to access Option Robot?
A: No. opening a new account is absolutely free. The free demo account comes credited with $1000 virtual cash. Switching between the demo mode and real money mode is as simple as clicking on the “TRY DEMO MODE” button or “REAL MONEY MODE” button.
Q: Can I trust the online binary options brokers that support OptionRobot?
A: Option Robot can be linked to broker account held by 9 different brokers. Many of these brokers are licensed and regulated by leading financial authorities. In addition, some of these brokers have built a good reputation for providing quality options trading platforms.
It’s worth noting that some brokers might not offer their services to traders from certain regions. It’s always advisable to check with each one of the 9 brokers that support OptionRobot to ensure that the one you invest your money with is actually permitted to operate within your region.
Q: Per day, how many investment signals can this software generate?
A: Theoretically, Option Robot software can generate well over40 different trading signals. However, it’s usually recommended that you don’t open more than 10 trades per day. This way, you will minimize the number of trading signals generated. Fewer trading signals mean it will become easier to track and analyze asset movements. It also makes it easier to follow through on your trading strategy.
Q: Why are the percentage return and payout different in the demo account and real money account?
A: All the signals available on the demo account are identical to those on the real money account. The differences between percentage payout and return are usually due to the effective return and payouts offered by individual brokers.
Q: How can I customize trade settings on the OptionRobot software?
A: Once you’re logged in to your account, click on the “settings” button. On the new window, you can make custom settings by making changes on:
– Number of simultaneous trades (1 to
– Trade method (Fibonacci, Classic or Martingale)
– Currency pairs (8 different currency pairs)
– Trade expiry (60, 90 seconds,2minute 5 minutes)
– Trade amount ($5 to $1250)
– Technical indicators to use (MACD, RSI, SOCH, Trend, CCI and William)
Q: Can I link my existing broker account with my new Option Robot account?
A: Unfortunately, OptionRobot accounts can only be linked with broker accounts opened through the OptionRobot official website.
Why you should consider using OptionRobot for binary options trading
Many binary options traders agree that learning to trade currency pairs lays the foundation for learning how to trade more complex assets. If you want to accelerate the learning process, it might be necessary to use supporting tools such as trade automation bots.
OptionRobot sets itself apart from competing software by offering a free demo account. This makes it an attractive option for beginner traders who don’t want to invest a lot of money on expensive software. Experienced traders will also find the software a great tool to try out different trading strategies for free before investing their cash.
Option Robot also offers useful tools and features that you won’t find in ordinary commercial binary options trading software. These features include 6 different technical indicators and 3 different integrated trading methods. In addition, the platform links to some of the leading online brokers.
Getting started is fairly easy. Once you’ve created you account, you can easily start testing the demo account which has $1000 virtual cash. Customizing the bot to match your trading style is also quite easy via the “settings” button found on your account interface.
Overall, if you’re looking for a legit and unique binary options trading software, OptionRobot is worth considering. You’re not required to spend a dime to purchase the software. The only money you’ll need to invest is topping up your trader account balance with one of the 9 brokers supporting the software. General Risk Warning! your capital may be at risk
How to Succeed with Binary Options Trading 2020
Welcome to the largest expert guide to binary options and binary trading online. BinaryOptions.net has educated traders globally since 2020 and all our articles are written by professionals who make a living in the finance industry and online trading. We have close to a thousand articles and reviews to guide you to be a more profitable trader in 2020 no matter what your current experience level is. If you wish to discuss trading or brokers with other traders, we also have the world’s largest forum with over 20 000 members and lots of daily activity. Read on to get started trading today!
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What is a Binary Option and How Do You Make Money?
A binary option is a fast and extremely simple financial instrument which allows investors to speculate on whether the price of an asset will go up or down in the future, for example the stock price of Google, the price of Bitcoin, the USD/GBP exchange rate, or the price of gold. The time span can be as little as 60 seconds, making it possible to trade hundreds of times per day across any global market.
Before you place a trade you know exactly how much you stand to gain if your prediction is correct, usually 70-95% – if you invest $100 you will receive a credit of $170 – $195 on a successful trade. This makes risk management and trading decisions much more simple. The outcome is always a Yes or No answer – you either win it all or you lose it all – hence it being a “binary” option. The risk and reward is known in advance and this structured payoff is one of the attractions.
Exchange traded binaries are also now available, meaning traders are not trading against the broker.
To get started trading you first need a regulated broker account (or licensed). Pick one from the recommended brokers list, where only brokers that have shown themselves to be trustworthy are included. The top broker has been selected as the best choice for most traders.
If you are completely new to binary options you can open a demo account with most brokers, to try out their platform and see what it’s like to trade before you deposit real money.
Introduction Video – How to Trade Binary Options
These videos will introduce you to the concept of binary options and how trading works. If you want to know even more details, please read this whole page and follow the links to all the more in-depth articles. Binary trading does not have to be complicated, but as with any topic you can educate yourself to be an expert and perfect your skills.
The most common type of binary option is the simple “Up/Down” trade. There are however, different types of option. The one common factor, is that the outcome will have a “binary” result (Yes or No). Here are some of the types available:
- Up/Down or High/Low – The basic and most common binary option. Will a price finish higher or lower than the current price a the time of expiry.
- In/Out, Range or Boundary – This option sets a “high” figure and “low” figure. Traders predict whether the price will finish within, or outside, of these levels (or ‘boundaries’).
- Touch/No Touch – These have set levels, higher or lower than the current price. The trader has to predict whether the actual price will ‘touch’ those levels at any point between the time of the trade an expiry.
Note with a touch option, that the trade can close before the expiry time – if the price level is touched before the option expires, then the “Touch” option will payout immediately, regardless of whether the price moves away from the touch level afterwards.
- Ladder – These options behave like a normal Up/Down trade, but rather than using the current strike price, the ladder will have preset price levels (‘laddered’ progressively up or down).These can often be some way from the current strike price.As these options generally need a significant price move, payouts will often go beyond 100% – but both sides of the trade may not be available.
How to Trade – Step by Step Guide
Below is a step by step guide to placing a binary trade:
- Choose a broker – Use our broker reviews and comparison tools to find the best binary trading site for you.
- Select the asset or market to trade – Assets lists are huge, and cover Commodities, Stocks, Cryptocurrency, Forex or Indices. The price of oil, or the Apple stock price, for example.
- Select the expiry time – Options can expire anywhere between 30 seconds up to a year.
- Set the size of the trade – Remember 100% of the investment is at risk so consider the trade amount carefully.
- Click Call / Put or Buy / Sell – Will the asset value rise or fall? Some broker label buttons differently.
- Check and confirm the trade – Many brokers give traders a chance to ensure the details are correct before confirming the trade.
Choose a Broker
Options fraud has been a significant problem in the past. Fraudulent and unlicensed operators exploited binary options as a new exotic derivative. These firms are thankfully disappearing as regulators have finally begun to act, but traders still need to look for regulated brokers.
Note! Don’t EVER trade with a broker or use a service that’s on our blacklist and scams page, stick with the ones we recommend here on the site. Here are some shortcuts to pages that can help you determine which broker is right for you:
- Compare all brokers – if you want to compare the features and offers of all recommended brokers.
- Bonuses and Offers – if you want to make sure you get extra money to trade with, or other promotions and offers.
- Low minimum deposit brokers – if you want to trade for real without having to deposit large sums of money.
- Demo Accounts – if you want to try a trading platform “for real” without depositing money at all.
- Halal Brokers – if you are one of the growing number of Muslim traders.
The number and diversity of assets you can trade varies from broker to broker. Most brokers provide options on popular assets such as major forex pairs including the EUR/USD, USD/JPY and GBP/USD, as well as major stock indices such as the FTSE, S&P 500 or Dow Jones Industrial. Commodities including gold, silver, oil are also generally offered.
Individual stocks and equities are also tradable through many binary brokers. Not every stock will be available though, but generally you can choose from about 25 to 100 popular stocks, such as Google and Apple. These lists are growing all the time as demand dictates.
The asset lists are always listed clearly on every trading platform, and most brokers make their full asset lists available on their website. This information is also available within our reviews, including currency pairs.
The expiry time is the point at which a trade is closed and settled. The only exception is where a ‘Touch’ option has hit a preset level prior to expiry. The expiry for any given trade can range from 30 seconds, up to a year. While binaries initially started with very short expiries, demand has ensured there is now a broad range of expiry times available. Some brokers even give traders the flexibility to set their own specific expiry time.
Expiries are generally grouped into three categories:
- Short Term / Turbo – These are normally classed as any expiry under 5 minutes
- Normal – These would range from 5 minutes, up to ‘end of day’ expiries which expire when the local market for that asset closes.
- Long term – Any expiry beyond the end of the day would be considered long term. The longest expiry might be 12 months.
While slow to react to binary options initially, regulators around the world are now starting to regulate the industry and make their presence felt. The major regulators currently include:
- Financial Conduct Authority (FCA) – UK regulator
- Cyprus Securities and Exchange Commission (CySec) – Cyprus Regulator, often ‘passported’ throughout the EU, under MiFID
- Commodity Futures Trading Commission (CFTC) – US regulator
- Australian Securities and Investments Commission (ASIC)
There are also regulators operating in Malta and the Isle of Man. Many other authorities are now taking a keen a interest in binaries specifically, notably in Europe where domestic regulators are keen to bolster the CySec regulation.
Unregulated brokers still operate, and while some are trustworthy, a lack of regulation is a clear warning sign for potential new customers.
Recently, ESMA (European Securities and Markets Authority) moved to ban the sale and marketing of binary options in the EU. The ban however, only applies to brokers regulated in the EU. This leaves traders two choices to keep trading: Firstly, they can trade with an unregulated firm – this is extremely high risk and not advisable. Some unregulated firms are responsible and honest, but many are not.
The second choice is to use a firm regulated by bodies outside of the EU. ASIC in Australia are a strong regulator – but they will not be implementing a ban. This means ASIC regulated firms can still accept EU traders. See our broker lists for regulated or trusted brokers in your region.
There is also a third option. Traders who register as ‘professional’ are exempt from the new ban. The ban is only designed to protect ‘retail’ investors. A professional trader can continue trading at EU regulated brokers such as IQ Option. To be classed as professional, an account holder must meet two of these three criteria:
- Open 10 or more trades per quarter, of €150 or more.
- Have assets of €500,000 or more
- Have worked for two years in a financial firm and have experience of financial products.
Strategies and Guides
We have a lot of detailed guides and strategy articles for both general education and specialized trading techniques. Below are a few to get you started if you want to learn the basic before you start trading. From Martingale to Rainbow, you can find plenty more on the strategy page.
Signals and Other Services
For further reading on signals and reviews of different services go to the signals page.
If you are totally new to the trading scene then watch this great video by Professor Shiller of Yale University who introduces the main ideas of options:
Education for beginners:
Types of Trades
How to Set Up a Trade
The ability to trade the different types of binary options can be achieved by understanding certain concepts such as strike price or price barrier, settlement, and expiration date. All trades have dates at which they expire.
When the trade expires, the behaviour of the price action according to the type selected will determine if it’s in profit (in the money) or in a loss position (out-of-the-money). In addition, the price targets are key levels that the trader sets as benchmarks to determine outcomes. We will see the application of price targets when we explain the different types.
There are three types of trades. Each of these has different variations. These are:
Let us take them one after the other.
Also called the Up/Down binary trade, the essence is to predict if the market price of the asset will end up higher or lower than the strike price (the selected target price) before the expiration. If the trader expects the price to go up (the “Up” or “High” trade), he purchases a call option. If he expects the price to head downwards (“Low” or “Down”), he purchases a put option. Expiry times can be as low as 5 minutes.
Please note: some brokers classify Up/Down as a different types, where a trader purchases a call option if he expects the price to rise beyond the current price, or purchases a put option if he expects the price to fall below current prices. You may see this as a Rise/Fall type on some trading platforms.
The In/Out type, also called the “tunnel trade” or the “boundary trade”, is used to trade price consolidations (“in”) and breakouts (“out”). How does it work? First, the trader sets two price targets to form a price range. He then purchases an option to predict if the price will stay within the price range/tunnel until expiration (In) or if the price will breakout of the price range in either direction (Out).
The best way to use the tunnel binaries is to use the pivot points of the asset. If you are familiar with pivot points in forex, then you should be able to trade this type.
This type is predicated on the price action touching a price barrier or not. A “Touch” option is a type where the trader purchases a contract that will deliver profit if the market price of the asset purchased touches the set target price at least once before expiry. If the price action does not touch the price target (the strike price) before expiry, the trade will end up as a loss.
A “No Touch” is the exact opposite of the Touch. Here you are betting on the price action of the underlying asset not touching the strike price before the expiration.
There are variations of this type where we have the Double Touch and Double No Touch. Here the trader can set two price targets and purchase a contract that bets on the price touching both targets before expiration (Double Touch) or not touching both targets before expiration (Double No Touch). Normally you would only employ the Double Touch trade when there is intense market volatility and prices are expected to take out several price levels.
Some brokers offer all three types, while others offer two, and there are those that offer only one variety. In addition, some brokers also put restrictions on how expiration dates are set. In order to get the best of the different types, traders are advised to shop around for brokers who will give them maximum flexibility in terms of types and expiration times that can be set.
Trading via your mobile has been made very easy as all major brokers provide fully developed mobile trading apps. Most trading platforms have been designed with mobile device users in mind. So the mobile version will be very similar, if not the same, as the full web version on the traditional websites.
Brokers will cater for both iOS and Android devices, and produce versions for each. Downloads are quick, and traders can sign up via the mobile site as well. Our reviews contain more detail about each brokers mobile app, but most are fully aware that this is a growing area of trading. Traders want to react immediately to news events and market updates, so brokers provide the tools for clients to trade wherever they are.
What Does Binary Options Mean?
“Binary options” means, put very simply, a trade where the outcome is a ‘binary’ Yes/No answer. These options pay a fixed amount if they win (known as “in the money”), but the entire investment is lost, if the binary trade loses. So, in short, they are a form of fixed return financial options.
How Does a Stock Trade Work?
Steps to trade a stock via a binary option;
- Select the stock or equity.
- Identify the desired expiry time (The time the option will end).
- Enter the size of the trade or investment
- Decide if the value will rise or fall and place a put or call
The steps above will be the same at every single broker. More layers of complexity can be added, but when trading equities the simple Up/Down trade type remains the most popular.
Put and Call Options
Call and Put are simply the terms given to buying or selling an option. If a trader thinks the underlying price will go up in value, they can open a call. But where they expect the price to go down, they can place a put trade.
Different trading platforms label their trading buttons different, some even switch between Buy/Sell and Call/Put. Others drop the phrases put and call altogether. Almost every trading platform will make it absolutely clear which direction a trader is opening an option in.
Are Binary Options a Scam?
As a financial investment tool they in themselves not a scam, but there are brokers, trading robots and signal providers that are untrustworthy and dishonest.
The point is not to write off the concept of binary options, based solely on a handful of dishonest brokers. The image of these financial instruments has suffered as a result of these operators, but regulators are slowly starting to prosecute and fine the offenders and the industry is being cleaned up. Our forum is a great place to raise awareness of any wrongdoing.
These simple checks can help anyone avoid the scams:
- Marketing promising huge returns. This is clear warning sign. Binaries are a high risk / high reward tool – they are not a “make money online” scheme and should not be sold as such. Operators making such claims are very likely to be untrustworthy.
- Know the broker. Some operators will ‘funnel’ new customer to a broker they partner with, so the person has no idea who their account is with. A trader should know the broker they are going to trade with! These funnels often fall into the “get rich quick” marketing discussed earlier.
- Cold Calls. Professional brokers will not make cold calls – they do not market themselves in that way. Cold calls will often be from unregulated brokers interested only in getting an initial deposit. Proceed extremely carefully if joining a company that got in contact this way. This would include email contact as well – any form of contact out of the blue.
- Terms and Conditions. When taking a bonus or offer, read the full terms and conditions. Some will include locking in an initial deposit (in addition to the bonus funds) until a high volume of trades have been made. The first deposit is the trader’s cash – legitimate brokers would not claim it as theirs before any trading. Some brokers also offer the option of cancelling a bonus if it does not fit the needs of the trader.
- Do not let anyone trade for you. Avoid allowing any “account manager” to trade for you. There is a clear conflict of interest, but these employees of the broker will encourage traders to make large deposits, and take greater risks . Traders should not let anyone trade on their behalf.
Which Are The Best Trading Strategies?
Binary trading strategies are unique to each trade. We have a strategy section, and there are ideas that traders can experiment with. Technical analysis is of use to some traders, combined with charts, indicators and price action research. Money management is essential to ensure risk management is applied to all trading. Different styles will suit different traders and strategies will also evolve and change.
There is no single “best” strategy. Traders need to ask questions of their investing aims and risk appetite and then learn what works for them.
Are Binary Options Gambling?
This will depend entirely on the habits of the trader. With no strategy or research, then any short term investment is going to win or lose based only on luck. Conversely, a trader making a well researched trade will ensure they have done all they can to avoid relying on good fortune.
Binary options can be used to gamble, but they can also be used to make trades based on value and expected profits. So the answer to the question will come down to the trader.
Advantages of Binary Trading
The main benefit of binaries is the clarity of risk and reward and the structure of the trade.
Minimal Financial Risk
If you have traded forex or its more volatile cousins, crude oil or spot metals such as gold or silver, you will have probably learnt one thing: these markets carry a lot of risk and it is very easy to be blown off the market. Things like leverage and margin, news events, slippages and price re-quotes, etc can all affect a trade negatively. The situation is different in binary options trading. There is no leverage to contend with, and phenomena such as slippage and price re-quotes have no effect on binary option trade outcomes. This reduces the risk in binary option trading to the barest minimum.
The binary options market allows traders to trade financial instruments spread across the currency and commodity markets as well as indices and bonds. This flexibility is unparalleled, and gives traders with the knowledge of how to trade these markets, a one-stop shop to trade all these instruments.
A binary trade outcome is based on just one parameter: direction. The trader is essentially betting on whether a financial asset will end up in a particular direction. In addition, the trader is at liberty to determine when the trade ends, by setting an expiry date. This gives a trade that initially started badly the opportunity to end well. This is not the case with other markets. For example, control of losses can only be achieved using a stop loss. Otherwise, a trader has to endure a drawdown if a trade takes an adverse turn in order to give it room to turn profitable. The simple point being made here is that in binary options, the trader has less to worry about than if he were to trade other markets.
Greater Control of Trades
Traders have better control of trades in binaries. For example, if a trader wants to buy a contract, he knows in advance, what he stands to gain and what he will lose if the trade is out-of-the-money. This is not the case with other markets. For example, when a trader sets a pending order in the forex market to trade a high-impact news event, there is no assurance that his trade will be filled at the entry price or that a losing trade will be closed out at the exit stop loss.
The payouts per trade are usually higher in binaries than with other forms of trading. Some brokers offer payouts of up to 80% on a trade. This is achievable without jeopardising the account. In other markets, such payouts can only occur if a trader disregards all rules of money management and exposes a large amount of trading capital to the market, hoping for one big payout (which never occurs in most cases).
In order to trade the highly volatile forex or commodities markets, a trader has to have a reasonable amount of money as trading capital. For instance, trading gold, a commodity with an intra-day volatility of up to 10,000 pips in times of high volatility, requires trading capital in tens of thousands of dollars. However, binary options has much lower entry requirements, as some brokers allow people to start trading with as low as $10.
Disadvantages of Binary Trading
Reduced Trading Odds for Sure-Banker Trades
The payouts for binary options trades are drastically reduced when the odds for that trade succeeding are very high. While it is true that some trades offer as much as 85% payouts per trade, such high payouts are possible only when a trade is made with the expiry date set at some distance away from the date of the trade. Of course in such situations, the trades are more unpredictable.
Lack of Good Trading Tools
Some brokers do not offer truly helpful trading tools such as charts and features for technical analysis to their clients. Experienced traders can get around this by sourcing for these tools elsewhere; inexperienced traders who are new to the market are not as fortunate. This is changing for the better though, as operators mature and become aware of the need for these tools to attract traders.
Limitations on Risk Management
Unlike in forex where traders can get accounts that allow them to trade mini- and micro-lots on small account sizes, many binary option brokers set a trading floor; minimum amounts which a trader can trade in the market. This makes it easier to lose too much capital when trading binaries. As an illustration, a forex broker may allow you to open an account with $200 and trade micro-lots, which allows a trader to expose only acceptable amounts of his capital to the market. However, you will be hard put finding many binary brokers that will allow you to trade below $50, even with a $200 account. In this situation, four losing trades will blow the account.
Cost of Losing Trades
Unlike in other markets where the risk/reward ratio can be controlled and set to give an edge to winning trades, the odds of binary options tilt the risk-reward ratio in favour of losing trades.
When trading a market like the forex or commodities market, it is possible to close a trade with minimal losses and open another profitable one, if a repeat analysis of the trade reveals the first trade to have been a mistake. Where binaries are traded on an exchange, this is mitigated however.
Spot Forex vs Binary Trading
These are two different alternatives, traded with two different psychologies, but both can make sense as investment tools. One is more TIME centric and the other is more PRICE centric. They both work in time/price but the focus you will find from one to the other is an interesting split. Spot forex traders might overlook time as a factor in their trading which is a very very big mistake. The successful binary trader has a more balanced view of time/price, which simply makes him a more well rounded trader. Binaries by their nature force one to exit a position within a given time frame win or lose which instills a greater focus on discipline and risk management. In forex trading this lack of discipline is the #1 cause for failure to most traders as they will simply hold losing positions for longer periods of time and cut winning positions in shorter periods of time. In binary options that is not possible as time expires your trade ends win or lose. Below are some examples of how this works.
Above is a trade made on the EUR/USD buying in an under 10 minute window of price and time. As a binary trader this focus will naturally make you better than the below example, where a spot forex trader who focuses on price while ignoring the time element ends up in trouble. This psychology of being able to focus on limits and the dual axis will aid you in becoming a better trader overall.
The very advantage of spot trading is its very same failure – the expansion of profits exponentially from 1 point in price. This is to say that if you enter a position that you believe will increase in value and the price does not increase yet accelerates to the downside, the normal tendency for most spot traders is to wait it out or worse add to the losing positions as they figure it will come back. The acceleration in time to the opposite desired direction causes most spot traders to be trapped in unfavourable positions, all because they do not plan time into their reasoning, and this leads to a complete lack of trading discipline.
The nature of binary options force one to have a more complete mindset of trading off both Y = Price Range and X = Time Range as limits are applied. They will simply make you a better overall trader from the start. Conversely on the flip side, they by their nature require a greater win rate as each bet means a 70-90% gain vs a 100% loss. So your win rate needs to be on average 54%-58% to break even. This imbalance causes many traders to overtrade or revenge trade which is just as bad as holding/adding to losing positions as a spot forex trader. To successfully trade you need to practice money management and emotional control.
In conclusion, when starting out as a trader, binaries might offer a better foundation to learn trading. The simple reasoning is that the focus on TIME/PRICE combined is like looking both ways when crossing the street. The average spot forex trader only looks at price, which means he is only looking in one direction before crossing the street. Learning to trade taking both time and price into consideration should aid in making one a much overall trader.
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