Binary
options are an easy and popular way to trade the https://www.linkedin.com/pulse/insider-binary-bot-review-kumar-raj markets, without the
complexities of regular trading. Plus, you don't need tens of
thousands of dollars to get started. You can achieve returns of 60%
to 500% in less than an hour! We will focus on the simple,
fixed-payout binary options offered by brokers such as AnyOption,
StartBrokers, Binarix and others. We'll use AnyOption in our example,
since they have the best payouts of any fixed-payout binary options
broker we've found. You can trade stocks, indexes and commodities
with binary options, but we will concentrate on the forex market, due
to the ready availability of free charting packages and technical
analysis tools for currency traders.
In
a standard fixed-payout binary options trade, a profitable trade pays
out between 60-70%, while a loss will result in a return of 15% of
your investment. This equals a total loss of 85% of your investment.
A potential gain of 60-70% versus a potential loss of 85% does not
put the odds into your favor. However, I will share with you a
powerful hedging strategy that creates a "profit zone" with
an overall positive expectation. By placing a Put (sell) option above
a Call (buy) option, it is virtually guaranteed that at least one
trade will be profitable. Due to our negative profit expectation, a
simultaneous win and loss will result in a loss of 15%, while a win
will result in a profit of 60-70%!
A
potential gain of 70% versus a potential loss of 15% is a lot better
than a potential loss of 85%! Here is an example of how we can do
this. Let's say we're placing a Call option in an uptrend. As long as
the uptrend continues, we'll realize a profit at the expiration time.
But what if the trend reverses? This is the perfect opportunity to
place our profit zone trade. Simply place a Put option in the
direction of the trend reversal. As long as the expiration price is
above our Call option Insider Binary Bot Review strike price, but below our Put option strike
price, we'll receive an overall profit of 60-70% of our investment.
If one of the trades finishes out of the money, we'll see a loss of
15%, assuming that both trades are the same size. With these odds, we
only need to win about 25% of our trades to make a profit. Without
this strategy, we would need to win well over half of our trades.
This setup won't happen all the time, but as long as you always trade
into a strong trend, and keep aware for potential reversals, you
should see an overall profit trading forex binary options.
