What Are The Advantages Of Binary Options Trading Over Forex Trading?
If you want to make more money through trading, there is a pretty good possibility you will first have to decide what trading form is the best for you. Believe it or not, this is not a simple decision. Some options are simply better for some people and the final choice you make can drastically influence whether or not you will be successful.
When binary options trading first appeared, it quickly gained a lot of attention. This was when people of literally all experience levels and knowledge levels started to enter financial trading. Up until then, trading seemed to be reserved just for some firms and individuals.
Binary options trading does have some pretty clear advantages when comparing with Forex. While with Forex trading you definitely have a higher earning potential, the learning curve is also really high. Most people move towards binary options trading because of the following advantages.
When you invest in binary options, you know exactly how much you could win and lose. This helps a lot in cutting losses. Defined and limited loss does influence the trader, who knows exactly what will happen even if they lose or win.
In Forex trading it is possible to use Stop Loss signals. There are actually many types you can use. However, in order to properly use them, you do need a lot of discipline. This is much easier said than done. Many traders actually remove this feature whenever they see that the market is going exactly in the desired direction. Unfortunately, this always leads to higher losses than what was initially expected.
When you use binary options trading, the loss is fixed. You cannot lose more than what you already know you will. At the same time, market volatility will not impact binary options.
This advantage practically means that you can be involved in the market as you trade binary options for really short periods of times. Some operators even allow you to buy options for 30 seconds. In Forex trading this is not actually possible as the market does not really move much in minutes. A good profit can actually be made in just minutes, as opposed to hours or even days.
One of the biggest advantages of trading binary options is that your goal is to finish “in the money”. In Forex trading you want to have price levels leave specific marks. These marks can be a large distance from the current value. Basically, in Forex trading, a bigger market movement is needed in order to get the profit you can see in binary options trading.
For the trader, it is much easier to make educated guesses about whether or not prices go down or up, based on the current price. In Forex it is more difficult to figure out how much a price will fall or go up.
All business ventures have advantages and disadvantages. This is true for every single trading option available. With binary options, the main advantages are the ones that are mentioned above. It is quite obvious that beginners have a much higher chance of being successful with binary options. However, this does not mean success is guaranteed. You need knowledge in order to predict what happens with prices so you can make high profits.