To all traders with interest in binary options, the question about what are pros and cons of binary options trading arises by itself.
With plan to make a profit and be able to constantly make money from this online trading type, traders should know the common pros and cons of binary options.
Below in this binary guide, we’ll try to cover the basics of binary options trading and provide detailed information about how what is acceptable and what should be avoided, especially in a role of trader novice who doesn’t have any previous trading knowledge.
Main Pros of Trading Binary Options
In this segment of our trading guide, we will provide interested traders a list of top binary elements which are considered as pros and when taken into consideration, can lead traders into having a profitable binary options trading experience.
Many reviewed and reputable binary brokers claim to offer excellent trading features on their platforms which can be easily used by many traders. Brokers, such as IQ Option, Daweda Exchange, 24option etc usually offer high returns on investment, ranging from 68% up to 90%.
Therefore, it is clear why is binary industry a popular choice for regular people who want to have option to benefit from binary options without being scammed.
Growing Industry of Binary Options
Binary options industry emerged in the same time as financial crisis hit global markets in 2008.
It opens a door to all the people who aren’t connected with online investment nor normally trade with different assets, such as professionals.
This is definitely one of the main pros of binary options trading since traders beginners can participate in it and deposit in order to potentially make money from it.
This rising online industry enables traders across the world to invest is a variety of underlying assets, such as commodities, currency pairs, stocks and indices.
However, pro traders can also find relevant and useful trading tools in binary options industry. For example, different brokers offer various trading instruments and strategies, which might be overwhelming for beginners, but not experts in binary field.
Experience Simple Trading with Binaries
As another of binary options pros, simple trading process is one of the reasons why this online trading is widespread among many people worldwide.
Since majority of traders are new to binary options, easiness of trading platforms and simplicity in registration process comes as important “ingredient” in binary options trading.
On BinaryPreview site, traders can find a list of trustworthy binary brokers by our opinion and read their reviews in order to get a complete overview of what a particular broker can offer traders, regardless they are experts or beginners.
Definition of binary options itself shows how this online trading type is easy to understand since it is based on determining will price of an asset rise or will is fall in predetermined period of time. If the price rises, traders should select Call option, while in case price is falling, there is Put option.
The Power of Demo Account
As a trader, what is the main purpose of trading binaries on demo? There are several answers to that question and will show traders how they can benefit from the industry and increase chances for having better trading results.
Demo account is definitely one of the binary trading pros due to its advantages. The biggest one is the fact no risk is involved. This is possible since on demo account, traders do not deposit real money but instead they are provided with virtual funds from the broker.
Not all binary brokers offer demo accounts on their platforms, but top brokers, reviewed by us, do:
All these brokers offer demo as free trading instrument, which is also significant information for all traders. Demo account is mostly used by traders novice since they lack trading knowledge, which is why they choose a broker who gives them option to practice first and not deposit right away.
Also, demo can be attractive to professional traders since they are able to perform more complicated strategies and techniques which they would most likely avoid in real trading process.
Overall, option to practice how to trade binary options on demo account is very significant and useful, since there can not be any money loss. Therefore, no wonder why it is listed as one of the main pros of binary options trading around the world.
Start Slow and Have more Control over Trading Account
This can be a very good advice for traders beginners in binary options trading since it shows how it is possible to earn profits even without depositing huge money in the very beginning.
Deposit amounts with various brokers range from $5 to $250, which shows a diversity in binary trading and makes it more interesting to traders worldwide. These amounts are minimum deposits, there is of course option to deposit higher amounts of money. It depends on particular trading platform.
Even with basic account, traders can experience different trading tools, as well as access to educational materials etc. There is no rule since each binary broker offers different platforms and account types for registered traders.
Accordingly, it is important to note how traders should be aware of potential money gains and loss during each step. This is also one of benefits when trading binary options since possible earnings should be known even before a trade is placed.
This is a part where funds diversification comes into the “game”. It is advised not to put all trades all at once nor in the same asset.
Cons of Binary Options Investments
In this part of our binary guide, we’ll cover the most significant binary trading elements which can be evaluated as cons. These guidelines can help traders to detect possible scam and segments which could be avoided with purpose to have positive trading experience.
Existence of Scam Brokers
Due the fact there are around 400 brokers around, it can be a challenge to detect the right and trusted broker with whom it would be safe to trade binary options. This is why it is crucial for interested traders to be aware of potential scam brokers who mislead the traders.
The best possible advice for traders would be to carefully go through broker reviews as well as their platforms to get valid information. To have all useful info on disposal, it is important to read terms and conditions, as well as KYC policy and FAQs with explanations of how to trade binaries.
Scam brokers usually have poor T&C and customer support which isn’t friendly towards traders and don’t provide them with useful trading information.
For example, when traders have difficulties in terms of withdrawals and want to contact broker directly. This is when they might experience problems which could be avoided in the early beginning.
Trading with Involved Risk
Trading binary options does involve substantial risk and traders who invest in binaries need to be aware of this fact prior depositing. Since available assets include stocks, commodities, currencies and indices, there can not be any guarantees for absolute returns. Brokers who promise exactly that are most likely to be a scam.
As being a part of online trading investments, binary options trading is attractive to many people by offering them option to gain money quickly but traders do need to bear in mind that risk is involved and it would be a good option for traders not to rely on luck but on sharpening their trading skills.
Lack of Regulation in Binary Options
With plenty of binary brokers available on global financial market, traders should know how they have option to trade with regulated or unregulated brokers.
In binary industry, regulation status is optional and therefore, binary options brokers can choose whether they want to have a regulatory licence or not.
Currently, there are several regulatory authorities which are responsible for paying attention to brokers’ business behaviour and how secure their platforms are.