Tips to become a professional binary options trader

Your first step to binary options trading is to select a good and reliable broker. While it is easy to start trading in binary options, making money with such operations is not so simple. In this article, we list tips that will help you trade with binary options as successful professionals do.

Research assets: binary options are traded with a large number of underlying assets, including stocks, indices, currencies and raw materials. The key to making money successfully in binary options trading depends on the accuracy with which you can predict asset price movements. To acquire this skill, it is necessary to conduct an investigation into the asset with which you wish to trade. For example, if you want to negotiate a binary option with the underlying asset of the capital of ABC Ltd, consider the fundamentals, recent events, results and problems surrounding ABC Ltd. Similarly, it is important to be informed of the demand, the dynamic supply of the merchandise with which you wish to trade. If you understand the basics of technical analysis, you can complement it with a fundamental analysis and reduce the potential of a winning operation.

Read well: the movement of asset prices is influenced by the global economic scenario to some extent. Therefore, apart from the specific factors of the assets, it is important to read the news and current events worldwide. In addition, reading about the mistakes made by binary options operators will ensure that you do not repeat them.

Know the options available to you: There are different types of operations with binary options that you can perform. Once you know the available alternatives, you can use them to increase your earning potential. For example, a buy / sell option is the most traded. In this type, you must predict whether the price of the asset will have a tendency higher or lower than a predetermined exercise price at the expiration of the option. The 60-second option uses the same rule, except that the operation expires every 1 minute. In the One Touch binary option, you must predict whether the asset price will at least touch the default strike price once during the term of the contract. In the Limit options, you must determine if the price of the asset will remain in a predetermined range at the expiration of the contract. Check the types of binary options offered by your broker on your trading platform. With the knowledge of these, you can decide which one best suits your risky appetite and your comfort by predicting the movement of asset prices.

Mitigate risk: trade in any asset class is full of risks. Fortunately, you can combine two or more contracts to restrict your losses. One of those strategies is the 'matching strategy' in which you match a purchase option with a sale option to mitigate risk and make consistent profits. For example, you enter into a purchase option contract with an underlying asset such as shares of 'XYZ Ltd.' at an exercise price of $ 20. At the expiration of the contract, you are in a favorable position since XYZ is trading at $ 25. However, you anticipate that the price of the shares could fall due to a recent negative event. In which case, all your earnings through this trade will be eliminated. Therefore, buy a 'XYZ' sale option at an exercise price of $ 25. Indeed, you have created a 'safe' range between $ 20-25 by linking the call with the binary option contract put. If the asset price trends in the middle, this maturity range, you can get benefits from both contracts. If it falls outside the range, the losses of one contract will offset the earnings of the other. You can further explore this strategy by choosing your asset, which could be an action and an index, or two rival actions.

Merchant psychology: It is extremely essential that you do not think emotionally while trading. Successful and professional traders know when to reduce losses and move on. Most of the time, operators tend to sign new contracts to compensate for the loss of previous operations. This is acceptable as long as it operates within the capital it has allocated for such operations. Once it operates beyond its allocated capital to compensate for losses, it is taking a great risk.