Despite some of the criticism that persists within the financial world surrounding binary options, this form of trading can be very lucrative. Binaries are short term in nature, but you can find longer trades, too, sometimes up to a whole year long. There are a lot of binary options brokers out there, and the expiries that you find will be determined by the brokers you use. Some will even have super short term expiration times, all the way down to just 30 seconds long. There are some major advantages to trading binary options of any time length, but you always want to make sure that you are using the best broker service for your specific needs.
Choosing the Right Broker
Start out by figuring out what you need. If you don’t need 60 second options, don’t make them a priority. Instead, list out what you need, then find the broker that best fits those needs. A lot of people have the same general needs: high rates of return, specific underlying assets, specific expiration timeframes, and certain types of options to choose from. A lot of brokers offer these things, but only in certain respects. For example, 24Option (www.24option.com) has a big selection of binary options underlying assets, both U.S. based and foreign underlying stocks available to trade, but not all of them are available for 60 second option trading. If trading binary options on stocks is important for you to be able to trade short term, this might not be the best site unless you want to focus more on 5 minute options as the shortest timeframe you look at. Both can be profitable, of course, but it is still something to consider.
Don’t Buy Hype
Binary option brokers are businesses and they intend on making profits. The unfortunate side of this is that you will sometimes come across a broker with questionable motives. There are a few sites out there that try to make a quick few bucks without taking into consideration the needs of their clients. What these brokers do not understand is that it is in the brokers’ long term interests to keep their clients happy. The longer an individual stays with a broker, the more money a broker will make from that person, even if the trader is very profitable for themselves. So, instead of buying the hype from a promotional advertisement or a semi-clever marketing ploy, do your own research and make sure you put your money only into a site that will work with you and not one that is working against you. Reputable brokers like GTOptions (www.gtoptions.com) and TradeRush (www.traderush.com) do not need to resort to trickery in order to get your business. They have already built a client base and they keep this business. That should speak scores on its own.
Go With the Known
Binary options are gaining in popularity because they let you know more precisely what the risk and rewards that you are taking on are. If a 15 minute option has an 81 percent rate of return and you will lose 100 percent if you are wrong, then you can plan things more precisely and take this into account before you even execute the trade. It’s a major plus for you as a trader. But there is more to it than that. Knowing precisely how much you can profit or lose, and when those things will come to fruition, gives you the ability to use these short term trades and still accurately plot out long term profits in a way that you cannot with any other type of trading.
If you can gain an advantage by going with a trade that presents you with more information, going with a broker that you know more about will also give you an advantage. Even some of the newer brokers, like Redwood Options (www.redwoodoptions.com) have already established themselves as leaders within the industry because of the fact that they give their customers–both existing and potential–a lot more information than other brokers do. Things like an easy way to get market information and better educational resources have quickly become industry standards as brokers realize that these little things help them to retain customers and make more money over time.
Look at the Rewards
We trade in order to make money, right? So why wouldn’t you focus on trading with a broker that offers you bigger bonuses? Again, this is becoming an important feature within the world of options trading, and some brokers offer better rewards than others in terms of welcome and signup bonuses. How much free cash you can get and how easy it is to unlock that cash is dependent upon the broker you look at. Some, like MarketsWorld (www.marketsworld.com), have 100 percent matching bonuses, but for smaller limits. Generally speaking, the bonuses that are easiest to max out will be easier to unlock in terms of withdrawals. A bonus is usually available for trading with right away, but you cannot withdraw that cash to your bank account until you have traded a certain amount. Some brokers have a 20 times threshold. If you have a $300 bonus, you would have to trade $6,000 worth of options before that cash is yours to keep. If you lose it before then, there’s no penalty. But to withdraw the cash, you would need to meet your threshold amount first. This sounds like a huge amount, but many traders will hit that number in just a few weeks without problem.
Binary Options Brokers
There are dozens of binary options brokers out there right now offering demo accounts, and some are clearly much better than others. It’s not really that easy to pick which is best for you, though, simply because each trader will have their own unique sets of what they need out of a broker. Your best choice is to identify what you are looking for and then compare those things to a list of the most reputable brokers out there. Your needs might not match up perfectly, but they should come close. The closer you get, the more profitable you will end up being in the long run.