Binary options trading seems to be a perfect choice for beginners who do not have enough skills and experience for advanced analysis and calculations and search for easy solutions. And it truly is. But, in practice, the picture looks not so rosy. Do you want to know how that works for real? Read our expert overview.
First, let us discuss how binary options work. Their characteristic feature is simplicity ― to get a reward, one just needs to guess whether the price of a certain asset will move higher or lower than a specified point within an agreed period. In other words, one should predict only the direction of a movement. So, it is not surprising that such trading enjoys popularity among beginners who have limited experience and skills in terms of data and chart analysis.
So, you probably want to know whether it is possible to make good money on it and how to achieve that. We must highlight right away that binary options success stories do not look like making a fortune overnight with minimum prior education and research. A truly successful strategy usually involves several months of studying and practicing with virtual money via a demo account and, then, months (or even years) of daily trading with small sums, which allows forming a capital slowly but persistently.
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Let’s provide you with practical recommendations:
- Start from basic self-education. Your goal is to get a clear idea of how binary options work and the most advantageous related strategies.
- Get an account on a broker service, such as Binary.com or Pocket Option.
- Try your hand at demo trading. Test and polish your strategy and skills with virtual capital.
- Switch to a real profile (only after you make sure your personal strategy is effective).
- Execute your first trade. Do not risk more than 5% of your budget. If you see that your results are not so good after a few deals, return to demo trading and improve your strategy.
- Focus on a single asset for a start and study it thoroughly.
- Utilize varied sources of information: charts, expert forecasts, news, trading signals.
- Try different types of binary options.
In sum, binary options trading can lead you to great success even without a large initial capital, but you should devote much time to education, research, and market analysis and keep the risks minimal by sticking to small trades.
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