Choose a market where you can excel
Binary options markets offer a vast number of underlying assets which can be overwhelming for new traders looking to try to make some of the vast profits available in binary options trading. To prevent new traders simply gambling on any options it is important to understand that binary options trading platforms basically incorporate all types trading asset in one place. This means that currencies, stocks and commodities are all available on the same interface, rather than conventional trading platforms which is likely to only focus on one type of asset.
Due to the large amount of choice that binary options offers, it is advisable that traders begin by focusing on one single asset class. For those that already have reasonable knowledge about the financial markets, this may be a relatively easy choice of stocks or currencies. For those who are unsure what they will be most effective at trading, it is worth doing a bit of research and to really try to focus on trading something that interests you.
The first step to excelling in one particular market is to ask yourself when it is going to be possible to trade binary options. Whether this is the morning, afternoon or evening will greatly affect which markets are available to you to provide the best trading opportunities. For most, any of the daytime trading hours will allow active binary options trades in the stock and currency markets. For those who are only able to trade during the evenings, unless you are interested in trading foreign stocks, either the currency or commodities markets are going to be where you will look to specialise.
Binary options markets run for 24 hours through the working week but there are key times to trade some and key times to avoid others. Researching which markets will be most active during the time you have available to trade may be the key to your success.
Selecting an expiry time that is suitable
So we know that binary options can be traded across a whole host of assets including commodities, currencies and stocks. They can also, however, be traded across multiple timeframes which really is the most essential element of any successful binary options trade. The expiry time on binary options is the time chosen by the trader before the trade has been placed. This is part of the deal and will be the precise time that the broker decides if the binary options have closed in or out of the money.
Binary options expiry times range from days to just 60 seconds. Just as choosing an asset to specialise trading binary options is important, the choice of expiry time is also critical to making consistent trading profits. Although 60 second trading may be the most exciting way to invest in binary options, trying to do this whilst at work is not going to be the most ideal scenario. Binary options traders with limited time and access to the markets will find much more success trading hourly or even daily binary options. The returns will be similar to 60 second trading, approximately 80% profits on successful trades, but the additional time to purchase the options and undertake critical research before taking the trade will also be available.
Learn how to use some of the helpful tools that platforms offer
Binary options platforms offer some of the most advanced trading technology available and is one reason why it is becoming so popular. As the industry becomes more competitive, new and useful tools have been made available to traders in order to encourage loyalty to the best platforms. Binary options traders can now access tools allowing them to ‘roll-over’, or extend the life of their options, which is particularly helpful when a position is out of the money but needs additional time to become a profitable trade. Additionally, many platforms now provide a ‘close early’ feature which can be used conversely when a trade is in the money but there may be the possibility of trouble ahead. Closing the position early for a lower profit ensures that a winning position does not turn in to a losing one with the original expiry time.