One of the most common questions for all new binary options traders is exactly how much money should you invest in your new venture. Of course, binary options is all about making money and everyone hopes that the initial investment can be quickly reclaimed. Unlike traditional forms of trading, the first deposit need not be a large and risky sum of money so ideally you are looking to start out as small as possible and build up your account with consistently successful trades.
Large or small trading account?
Logically, the larger the deposited cash that you have in your account the more expensive the value of binary options you will be able to purchase. With this in mind, one of the age-old traps for many new traders is to pump a large amount of cash in to a binary options account, take some huge risks and eventually lose it all. Whatever system or strategy you trade this should be avoided at all costs. Look for a broker with a low minimum deposit such as IQOption where you can start trading with only $10 and $1 options – it can’t get any lower than that!
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RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK
It is important to rememeber that, with binary options, you can make money with a very small deposit. Short-term binary options can be traded many times throughout one day giving you multiple opportunities to profit even with a very modest deposit. When you trade for the first time it’s ridiculous to assume that you will make $2,000/month. You should minimize your risk and try something like $100 – an amount of money that will still let you make substantial profits once you become proficient at trading binary options. Well-known brokers like Anyoption allow you to start trading for as little as $100 for example. Click here to start trading at Anyoption and make use of this low minimum deposit.
Comparing Minimum Deposits
As we have established, it is really important to look for a broker that allows you to open a binary options trading account with a relatively low first deposit. However, having stressed the importance of not risking too much on your first venture in to trading binary options, it is also critical to look at the minimum option value when looking for a decent binary options broker. Obviously, a broker offering $50 mimimum investment on each binary options trade is going to make a low deposit of $100 irrelevant. This is also dangerous because it means that there is a high likelihood that you could lose your entire account in just two trades. Instead, look for a broker that can offer you low-cost binary options trades, as well as a low minimum deposit. Those offering around $5 as the minimum investment on each trade, alongside a $100 minimum deposit are going to allow you to trade much easier, safe in the knowledge that you can also afford the ocassional loss.
Small initial deposits improve trading performance
Trading is about reaching goals and personal targets which will be different for each trader. Whilst the initial deposit is important, it is not going to determine your success. Those who deposit large amounts of money are not more likely to be successful than thse who deposit less. On the contrary, with a small deposit you are much more likely to learn the important money management skills essentially to achieving success as a binary options trader.