How do you use low-risk binary options to make money?

Trading is among the most popular methods of investment available today. Among countless trading options, binary options are the simplest to trade. The binary options are short-term, high returns, and limited risk contracts. 

Like all other trading options, binary options require commitment, hard work & dedication to deliver profits. You must have a plan and pre-defined monetary goals to make informed trading decisions. 

What are binary options? 

Binary options are fast and simplified options that you’re trading into a simple Yes or No proposition. All investors have a chance to predict whether the price of an asset will increase or decrease on a particular date. 

There are only two results – you will either be right and earn your share of profit, or you’ll be wrong and will lose your investment. Due to its simplification, binary options have become an immensely popular platform. 

Binary options do not give you the option to own an asset, nor do you receive a dividend or voting rights. Following set plans & strategies, the process of trading binary options can be broken down into some easy steps. 

How to make money through binary options? 

Your success rate in making money and gaining high profits through binary options depends on the following strategies. 

Trade with the right asset

Choosing an asset to trade-in will be your first decision as a trader. This will be a difficult choice to make due to the enormous amount of assets available. With the inclusion of stocks, commodities, indices, forex pairs, etc., the binary options market gives its traders a choice of more than 150 financial assets. 

As a trader, you must concentrate on the liquidity and volatility of an asset. The reason for this is – in binary options trading, you make money from the price movement of an asset. Oil, Gold, USDJPY, EURUSD are a few examples of such assets. 

Furthermore, different assets have their specific time for trading. You need to trade your chosen assets at the right time. This depends on when the market is open. The opening hours of the stock markets vary as per the country. 

Follow the market trends

As a beginner, this should be your ideal trading strategy as you know that no market will move in a straight line like up-down or down-up. According to the market speculation, the price of the assets rises and falls. You need to track and recognize the pattern of the price trends of your chosen asset. 

This requires you to consistently follow the market trends, and make predictions accordingly. Events like wars, Elections, Technological advances, International Relations, etc., affect the market trends. To be a well-informed trader, follow the current affairs and understand their effects on the economy. 

Incorporating the news trading strategy

Following the news trends & global events will give you the much-needed information regarding the price variations. You should read and follow the news of all assets you are trading in. This method is easy for those who are unable to perform technical analysis. 

This includes checking on the newspapers, news channels, economic calendars, and online sources as well. The economic data has major effects on the price movements impacting the profitability and risks of the trading assets. 

Trade diversification

Signing up with a broker is a smart choice. A broker will help you in trading different kinds of binary options. Trade diversification will help in boosting the profitability of the market. This involves long-term options, short-term options, Call/Put options, No Touch options, Ladder options, One Touch options, etc. You may even receive returns up to 500% depending on your transaction.

Pinocchio strategy

The pinocchio strategy is unique and easy to implement. In this, you make a deliberate bet against what is trending. Such that, if there’s an asset currently having an upward trend, you can bet in favor of its price decrease. This requires an understanding of the asset to make relevant and profit-focused predictions.

Hedging strategy

This is known as the strategy where you can play both sides. You can bet on both teams to minimize the loss faced by one side. You should calculate beforehand the profit you’ll have at the time of expiration. This helps you in avoiding a lot of risky elements from the trading of binary options. 

Protect your capital

As a beginner, your main focus may lie solely on profits which is dangerous. As a trader, concentrating on risk management is the ideal way to earn profits. You should ensure that you risk 5% or less capital in each trade. Trading more than this may lead to you bleeding money. When you feel that the risk factor has become very high, you should opt for the “Early Close” feature. Through this feature, you can exit your position before the expiration date. You can lock profits through this by exiting good trades and can reduce the loss by exiting bad trades.

Robots and signals

Binary robots are software programs that can automatically create a trade whenever you are not available to do it. Based on your set preferences, the robots will trade in the market.

Binary Signals are the automated notification that you receive when the time to trade is right, or your preferred asset is available. If you have a busy schedule, this service is very beneficial for you. It gives you a chance to take advantage of all available opportunities to trade & earn profits.

Conclusion

The above strategies can help you make huge profits through the use of low-risk binary options. You can even make consistent profits when you follow a proper trading plan. Hard-Work, research, market analysis is the key to enhancing your trading profitability.

The strategies discussed above are beneficial for beginners as well as for experienced traders. You will earn a good level of profits when you follow two simple rules – Trade in the assets you have deep knowledge of and Trade the money that you are prepared to lose. 

About the author

I am an experienced Binary Options trader for more than 10 years. Mainly, I trade 60 second-trades at a very high hit rate.

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