36537

Trade in options for dummies — advice from Prime Signal

Classical purpose of an option is the right for buy or sale of an asset: stocks, commodity or currency, in a certain quantity, at the stipulated strike price,with fixed in the contract obligation of the seller at a specified date to make a reciprocal purchase (sale). Options are subdivided:

  • Call – to buy, is acquired during the growth of the asset, for its sale at the more highest levels;
  • Put – on the sale of asset is acquired at the time of falling of the price.
    The peculiarity of the option as a financial instrument is that it gives the right to purchase the asset, but does not oblige. In this regard, the holder feels free and can refuse the transaction at any time. Based on this options trading for dummies (beginning traders) can be a good practice.
    Options are divided by belonging to a stock exchange:
    • exchange – when the asset and its other parameters are set by the exchange, there same keep records of transactions;
    • off-exchange- when contracts are freely formed by participants in the process.
    The latter type was the forerunner of the emergence of binary options

 
Binary options

As binary options have evolved from the classical, and the differences between them are not very many. However, there are small features and the key is that they do not provide buy asset. In a binary strategy is important to correctly predict:
• will be at the time of expiration – end of the deal – the price rise or fall relative to the strike price, which took place at the time of purchase. The forecast gives reason to buy a Call or Put option;
• Will reach the price of asset indicated by the level before the end of the transaction or doesn’t reach. Achieving is as touch and purchased in the event of a favorable prognosis option called OneTouch. If the predicted failure to achievement, we are talking about the option NoTouch;
•will the asset price fluctuations remain in the corridor (In) or  beyond its borders (Out);
• Repayment of a specific price index at expiration – Below;
If the only option is purchased, then the forecast is – one of the following, depending of type of strategy. The latest forecast is extremely rare, often not even included in the initial lessons in binary options.
What to begin with?
If you have decided to devote yourself to trading on the binary options, you need to be information educated. Do not buy expensive lessons obscure traders or brokers. To begin To begin with, it is sufficient to draw the necessary information from various sources on the Internet- there is a lot of text and video material. Helpful tips are also available on the popular gaming platform – PremiumSignals.
 
By bringing together the various lessons, you get an idea ​​how correct to play on binary options..
Terminology
Besides those already mentioned in the article words- strike, expiration – in the course of training to meet such terms as:

  • indicators and trading signals are the tools that give orientation how to win on the binary options;
    • upward trend – when the asset price goes on increasing and, according to its course, should be acquired Call-option;
    • downtrend is the situation, anticipating the purchase of Put-option, at lower prices;
    • sideways are not stable oscillation. Enough comfortable to correctly predict the determination price in the hallway or exit (In; Out); beginners are not recommended to experiment with stakes in this state;
    • reversal is a point of change of the price direction from ascending to descending and, on the contrary: in the first case it is convenient for sale of an asset, in the last – for its purchase;
    • timeframe is installed on the terminal and cover the duration of the transaction,which can last from minutes to months. Traders often use multiple timeframes – from short to long in order to provide more than one transaction
    • Rollover is the continuation of the option.

Important tips

Even for those who have more than one year in sale and purchase options, the training continues in practice uninterrupted. Experienced traders use different methods, profiting even from a sideways trend. The combination of risk and analytical flair in a successful transaction is converted into a good income. In view of the riskiness of the transaction willingly accepted the work of the high bonus payments, but in order to successfully complete it – it is necessary to know the market well. Some famous traders do not hide that they use the exact sciences in the game.
All are trained in binary options trading can confirm that at the initial stage is required to trade only with the trend. The first practical lessons are best held on brokerage platforms where are accepted the minimum bets – they help cool the head, correctly operating with money. The minimum bet and following to a trend ­these components must be accompanied by training for binary options trading in order to avoid losses.

Strategy

Binary options have recently appeared, but have acquired a lot of strategy. Many were used in the stock exchange, the classic options and the Forex market currency. The latter factor is particularly important, as foreign exchange trading and quotation on the market of binary options traders an overwhelming majority.
Martingale Method is a strategy which has made a noise in the world of gamblings. It includes work with the clearly marked direction of prices is a recommendation to buy binary options for teapots.
During confident uptrend or downtrend should make a bet when you buy a call or put option. It is necessary to involve trade signals in a complex. If they by appeal to purchase or sale correspond to the movement schedule, so it is appropriate to talk about the high probability that the forecast is made correctly.
For beginners, passing the first lessons, you can choose a minimum amount of time. A successful outcome will serve as a good psychological push. Getting confidence in process of the trend movement it is possible to double the rates , even despite incorrect forecasts – all this will bring high percent of profit at achievement of the maximum point which compensates even wrong rates.
The names of the popular strategies are:
• Bollinger’s Method;
• 4 medium;
• Against the trend;
• 60 seconds;
• Trading on the news and others.
They are divided into short-term, long-term, simple and complex.

Indicators

Use of indicators directly doesn’t prompt how to win on binary options. It’s just a technical support methods, though, is quite effective. At the first stage they help to get advantageous options for teapots, but over time when those become gurus, their own strategy will probably move profitability of automated. In any case, their use consolidates confidence.
There is candlestick, line, oscilloscope, turnouts. Some of them, such as Ishimoku or option light levels have been known for a long time. It is important to use indicators without repainting like ADX, RSG, MACD, Ishimoku, etc. Redrawing is the negative phenomenon, which in the course of the trend shows a different value prices, which shows different values of the price on the trend course that influences forecasts – especially confuses beginners.
It is recommended to use several indicators, such as forward-looking and lagging trends that promotes the exact forecast. Support and Resistance Indicator combines two different properties.

Trading signals

Another means, orienting binary options on profitable, and how to trade is a trading signal. It is available on every gaming platform. Analysts, programmers, traders participate in its development, and they all use a calculated data and indications of many different indicators. During conducting the auction indicators and signals have to be combined, and the latter should not buy from the little-known traders, whatever what fairy tale they tell. It is necessary to take signals only on a platform and only free!

Why it is worth trading in binary options?

Binary options with the right strategy are reliable source of income. Its advantages in the controlled risk: do not be afraid to bet – it is important to identify for yourself the amount which you can donate for the auction for a certain period of time. Popularity of BO is caused also by the fact that people have acquired the rule – not to do the maximum rates. The simple truth is to follow a trend, collecting small profit, better than stake everything. The latter is not available to everyone, but for the majority is risky.