Advantages of binary options trading-
The advantages of binary options are multi-fold:
- Low speculation and Easy accessibility: When compared to the tradition trading technique, binary options trading has evolved into an open trading platform with transparent, simpler and safer trading modes. Online trading has made it possible for individual investors to trade from their homes without having to wait for the markets to open.
- Fixed returns: One of the greatest advantages of binary options is that the payoff is fixed and the investor is completely aware of the amount he may stand to lose and the exact profit that he will receive at very beginning. The risk involved is less and return high.
- Short expiry times ensure quick returns: Conventional trading contracts span over several months and the fluctuating asset prices influence the traders to either buy more stocks or sell the existent stocks making it a highly speculative and risky transaction. In Binary options however, the time frame is short and the traders are not required to purchase the stocks; rather they purchase options that determine whether the prices will shoot up or fall below the expected strike price.
- Increased trading flexibility: The digitalisation of trading has made binary options trading possible over a broader range of assets with increased flexibility over the trading variables like contract options, expiry times and trigger prices.
- Beginner’s paradise: For beginners, the various online trading the platforms offer a great opportunity to try out their luck and gain considerable hands-on experience with minimum expenditure before entering mainstream trade markets.
- Short term investment option: Binary options have become a lucrative option for making easy money in short time. For Instance a trader following a stock may be aware that the prices may rise or fall in the next half hour and he can purchase a contact on the cal or put option and make profit even if the stock has crossed the strike price by a value of 0.1. What more, the betting is not restricted to just a rise in the price but is also applicable to fall in prices.
- No 100% loss: one of the most popular advantage of binary options trading is that even if the prediction is incorrect, the trader gets to keep at least 10% of his premium.