Roboforex company had launched binary options – new innovative financial product, it is now available in new Robooption platform. So, let’s go through concept of binary options, it may seem confusing for some traders unfamiliar with it, but in reality this type of trading is easier than trading with conventional currency pairs.
What is binary option?
Binary option - agreement between buyer and seller, it can bring fixed amount of profit to buyer of the option in case some conditions are realized at expiration time.
Everything is quite simple: you define specific time period (from 1 minute to several days, weeks or months), and have to choose if price will be located above or below certain price (strike price). At the moment you execute a trade, you pay a premium for the option (fixed amount of money), in case your forecast is valid you receive payout (it usually covers premium and gives you around 70% profit per risk), in case it’s not – you get nothing, but your losses are limited by the size of the premium paid.
You can watch educational videos here to deepen your understanding of binary options traded in Robooption platform.
First of all, to successfully trade binary options, you have to analyze underlying currency pairs. Binary options are not isolated – they fully depend on behavior of price of underlying asset.
But, there are significant differencies between conventional forex trading and trading binary options. Binary options have limited risk, amount of risk is defined before the trade, also you have predefined size of the profit, even if price is located just 1 pip above or below the strike price.
Binary options trading does not require sophisticated trading strategies – they are simple, easy to execute, trading platform is intuitively understandable and doesn’t have to be installed on your computer.
We have to mention that binary options and traditional options are different financial instruments. Traditional options are much more complicated. We will cover differencies between them in separate thread for the sake of your education.
How to trade binary options on RoboOption
When you execute a trade – say, intend to buy an option, you give away premium (bet). If conditions of this trade are realized at the time of expiration, you receive your premium back as well as payout (up to 85% depending on instrument traded and other parameters). If conditions of the trade are not realized, you are not receiving premium back (as well as payout), but your losses will never exceed your bet.
To start trading binary options, you have to do several simple steps:
1. Register on a website RoboOption, we can open demo account to practice.
2. Deposit cash to your trading account choosing payment system of your favor , or setting amount of money for demo account;
3. Prepare for trading:
- Login to account;
- Choose trading instrument;
- Choose amount of premium;
- Press «Call» or «Put».
Interface of Robooption trading terminal looks like shown below:
Attachment 11606
- at the upper side of the platfrom we choose type of options: Binary options, Long terms, Sixty seconds;
- in the "Asset" field you can choose underlying asset for the options;
- in the field "Expiry" you can choose expiration date and time;
- in the field "Amount" you can choose amount of bet (premium) for your trade;
- also you can view a chart of underlying asset and "Call"/"Put" buttons;
- in the column below "Amount" you can view potential payout and premum;
Originally Posted by Kelv
