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The following article was published in our article directory on October 29, 2013.
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Article Category: Finances
Author Name: Bill Williams
Binary option trading is revolutionary in the way that it offers a simplified version of trading ideal for novice traders, while also offering experienced traders the tools to properly capitalize on their expertise.
Binary means one or the other, and it is this simplicity that has been one of the major reasons for the popularity of binary options with new traders, whether they come from a financial background or have no trading experience at all.
The very simple nature of this new way of trading means that it does not matter whether you have experience or not in trading; binary options levels the playing field for all traders - no matter what their background.
In essence, binary option traders are simply attempting to successfully forecast the future direction of everyday stocks, commodities and currencies. In its simplest form of up or down, all that a winning trader is required to predict is either the upward or downward movement on a financial market chart. Therefore, binary options, as the name suggests, have only two possible outcomes:
Binary options are the perfect investment vehicle for event trading. With so much complexity in the fundamentals of every asset, the simplicity of executing a binary options trade allows investors to immerse themselves in asset research, and trade only when they feel they have isolated a profitable entry point.
Also, because binary options tend to be short-term investments, they allow traders to get in and out of markets at times of high volatility and make profits that other investment vehicles simply cannot match.
Simplified Trading
Binary options' streamlined approach to trading provides some interesting advantages over other investment vehicles. The removal of bid/ask spreads, leverage, and hidden fees makes it extremely easy for binary traders to keep track of their risk capital and open trades. Also, with only two possible positions in any given binary trade, it couldn't be easier to take your knowledge to the markets.
Essentially, a binary options trader has only two things to consider:
i) Whether the asset in question will rise or fall in value in a given period of time
ii) ii) How much to invest in the position. Once these choices are made, and the trade is locked in, there is nothing more to consider. The magnitude of a price rise or fall is irrelevant. Simply put: you stand to gain the same if the price of the asset you are trading on is one pip up (or down - depending on whether your trade was a CALL or a PUT), as you do if it expires 1000 pips up (or down).
There are no stop-losses to manage and no way for an open position to leave you over-exposed. All the information a trader needs is available before they commit to any given trade.
Keywords: traderush review, binary option broker, best forex broker
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