With each passing day people get more and more confused with the different terms and initials traders use to describe what they do for a living.
We tend to think that trading is some kind of a rocket science and have to know all its aspects in order to make money out of it.
Market at its essence is really complicated matter, because it's formed by too many variables and it's hard to predict every outcome. That's where your proper financial education may come to use.
But if you're simply a starter who wants to know what binary option trading is and how can you make money out of it, you came to the right place.
Of course every one of us wants to know that the money we are investing are somehow returned in the future, and most of us keep preferring the safe ground. That has to stay the same. Every binary option broker states that your capital is at risk. And it will be at risk if you take binary option trading as gambling. But how can we possibly predict the otcome?
Let's get to the point.
What is binary option trading?
When we talk about binary the first thing that comes across our mind is the number two. With binary option we only have 2 options. As an example, imagine a question you can only answer with "yes" or "no" or "true" or "false". Except here you'll have to guess up and down.
While the market is moving and many traders are buying and selling different assets, the price of any is constantly changing due to the supply and demand principles. Economics 101 teaches us that the price is related to the supply and demand. As high the demand is, as higher the price is and the opposite. So we can describe the market as a living, breathing creature that is constantly changing based on the performance of the majority of traders, or a single trader who has the majority of stocks of a single company for example.
By buying one out of the two options (put or call) you place your bet whether the price will fall or rise for the time frame you've chosen (can be 1-5 minutes; 30 minutes; 1-12 hours; by the end of the day/week/month or any other time frame your broker provides). Based on market tendencies and some other factors, you make a prediction about the movement of prices of various assets, which are mostly currency pairs, precious metals and stocks. Let's say for instance you placed your 10$ bet that the price of gold with be higher in 5 minutes and you got that right. When the 5 minute period is over and the price at that moment is higher than it was the moment you placed your bet, you win your 10$ back and around 80% of it as a profit. So you placed 10$ and made them 18$. But if the outcome is different, you only lose your initial 10$ investment.
That's how easy it is to trade binary option. You only have to place your bet and result will come soon enough. The hardest is to predict the outcome, but we'll get to there soon. Stay with me and I'll teach you my every little secret how I make money while binary option trading. They are so simple that you'll wonder why don't everyone uses it. Sometimes the solution is right before our eyes, but we don't see it because we keep thinking that in order to make money we must use something very complicated and that is too easy to be true. Yes, it is easy and it's true. Stay with me and I'll show you how to do it by yourself.