ADVANCED

BINARY OPTIONS
STRATEGY
AUTOTRADER SIGNAL TOOL
Everything You Need to Know
About Binary Options
If you have looked into any type of investing recently chances are you have seen the words
binary options come up. Binary options trading has been around for awhile now, but it is
still considered to be a rather new form of trading option for investors.

What Are Binary Options?

Essentially, binary options are simply estimates of an underlying assets performance
during a set time frame. In order to understand binary options trading, it is important to
look at how trading in other markets typically works.

In most types of investment an investor purchases the asset that they want to invest in and
the value of the loss or profit is determined by the changes in price of that particular asset.
If the investor sells the asset when the price is higher than what they purchased it for they
make a profit. If they sell the asset for a
lower price they have lost.

For example, investor one purchase asset A

for $20 a share. The price of asset A after
one year has gone up to $40. The investor
sells his shares of asset A and makes a profit
of $20 per share. In the same example if the
price of asset A goes down to $15 per share
after a year and the investor chooses to sell,
they will lose $5 per share.

This type of investing requires traders to worry constantly about when they should sell their
assets and get out of the market in order to avoid the entire account of being exposed to
the volatility of the market.

Binary options trading is different because instead of trading in the market, investors are
actually trading futures on the market. Essentially, binary options trading involves
predicting the movement of an asset in a predetermined amount of time.
The word binary means having 2 parts. In binary options trading all you have to do is
predict either a call or a put. Essentially, there are only 2 investment choices for
traders to predict and to choose between.

The first investment option is expressed when a trader predicts that the price of an
asset is going to rise. This investment is referred to as a call option. The other
investment possibility is when the trader predicts the price of an asset is going to fall.
This is called a put option.

The first step in binary options trading is choosing the asset. For example, if you are
interested in gold prices you may choose to invest in it. The more familiar you are with
an asset, the better off you will be in predicting its future price. Once you have
researched an asset you can then decide whether or not the price is going to go up in a
set amount of time.

Binary options can be traded in 60 second intervals or even day and month intervals,
depending on the broker that is chosen.

While the practice of trading binary options seems rather simple, the binary options
market is actually quite volatile and making money trading binary options will take time
and experience as well as a good binary options trading strategy.
How to Trade Binary Options
When it comes to how to trade binary options, it is really quite simple. The binary options
market offers a way to trade with a capped risk and a capped profit potential. These bets
are based on simple yes or no propositions.

For example, the question may be, Will the

price of silver be above $17.51 at noon
today?

If you think that the price of silver will be

above this at noon, you will purchase the
binary option. If you think the price of silver
will be below $17.51 at noon you will sell
the option.

The price of all binary options is between

$0 and $100. Just like any other financial
market there is a bid price and an ask price.

In the above example the binary might be trading at $22 for the bid and $24 for the offer at
11:30 am. If you purchase the binary option right then you will pay $24 and if you decide to
sell at that point you will sell at $22.

If we assume that you are going to purchase the option at $24 and the price of silver goes
above $17.51 at noon, your option will expire and it is worth $100. Your profit is $100
minus $24 or $76 minus broker fees. This is referred to as being in the money.

However, if the price of silver is below $17.51 at noon, the option will expire at $0. This
means that you will lose the $24 that you invested. This is referred to being out of the
money.

The bids and offers fluctuate until the

expiration time. Traders can close their
position at any time before the expiry in
order to lock in a profit or to reduce the
amount of the loss when compared to
letting the option expire out of the money.

Essentially, binary options trading is a zero-

sum game. Each option is going to settle at
either $100 or $0 no matter what. If the proposition for the binary option is true it will be
worth $100 and if the proposition is false it will be worth $0. Thus every binary option is
worth $100. This is a zero sum game as what one trader makes another trader loses and
what one trader loses another trader makes.

Each trader has to place capital for their side of the trade agreement. In the example above
you purchased an option for $24 and someone else had to sell that option. Your maximum
risk for that option is $24 if the trade settles at $0. The person who sold the option has a
maximum risk of $76 if the option is in the money and settles at $100.

How Are Bids

Determined?
Bids and asks are determined by traders
directly. Traders will assess the probability
of whether or not the proposition is going
to be true or not. Simply put, if the bid and
the ask for a binary option are at 85 and 89,
traders believe there is a good chance that
the binary option is going to finish in the
money and it will be worth $100.

However, if the bid and ask are closer to 50, traders are not sure whether the binary is
going to expire in the money or not, so the odds are even.

When the bid and ask price are low, around 10 and 15, this means that traders think that
there is a low chance that the option outcome will be yes. Buyers of this type of binary
option are looking to take a small risk for a large gain. Those who are selling are taking a
small, but likely profit for a large risk.

Where Are Binary Options Traded?

Binary options are traded through binary options brokers. There currently is no regulator
that oversees all binary options and forex activities throughout the world. There has been
an increase in this type of trading over the years, which can be linked to the advances and
accessibility in technology around the world. For this reason, there have been several
regulatory bodies that have been formed in order to try to regulate forex and binary
options activities.
In many of these cases, these regulatory bodies operate within certain regions and the
main task is to monitor binary brokers in certain areas as a way to protect traders and
monitor the different brokers practices.

Many of the binary options trading brokers have enticing trade platforms as well as many
attractive bonuses for their traders. While many brokers look good, it is important to note
that all brokers on the market are reputable.

In the United States there are strict regulations imposed for brokers to accept traders
based in the United States. It is these regulations that make some brokers not accept
traders from certain areas.

Choosing Binary Options Brokers

Binary options trading offers many exciting opportunities for investors. These opportunities
are best enjoyed when the right binary options broker is chosen. Choosing the right broker
for your particular trading needs can be a daunting experience.
However, it is necessary if you want to succeed at trading binary options. Brokers can help
traders perform better during the trading process and also can provide information on how
to get the best returns for their investments.

There are many binary options brokers who are ready to help you as a client. It is
important to remember when choosing your binary options broker to be detailed in the
process and make sure that you find a broker that can perform all of your necessary trading
tasks. Here are some tips for simplifying the process to help you find the right binary
options broker to best meet your needs.

Deposit Bonus
One thing to consider when looking for a
binary options broker is the amount of the
deposit bonus that the broker provides.
Some brokers are quite generous with
deposit bonuses while others only provide
bonuses for their top investors. There are
also some brokers that only provide a bonus
on the initial deposit while others give
bonuses for redeposits as well.

Payouts
There are varied payouts produced through binary options trading. There are some brokers
that present variable options which allow exiting of options before the expiration date.
There are also some brokers such as 24Option that provide payouts of as much as 91% per
trade.

Since the ultimate goal for most traders is making money with binary option, choosing a
great binary options broker is necessary in order to succeed. In addition to payouts other
benefits to consider are: various payment options, quality customer support, and high
bonuses.

Maximum Percentages
Along with payouts it is important to consider maximum percentages. A dependable broker
will supply their traders with a maximum payout percentage. When searching for a broker
try to find a platform that present payouts of 75 to 91 percent. This will ensure that even
unsuccessful trades will generate a return of 5 to ten percent for investors.

Banking Options
The deposit methods and withdrawal
options are important when choosing a
broker. Each trading platform offers
different ways to deposit and withdraw
money. It is important to make sure that
the broker you are considering for your
trading needs allows you to deposit and
withdraw money in a manner that you
prefer.

Minimum Deposit Amounts

Each trading platform has a minimum deposit amount required in order to open up an
account. Typically, binary options brokers require a minimum amount of $200 to $250. It is
important to find a broker that allows a minimum deposit amount that you are comfortable
with.

Trading Tools
There are some binary options trading platforms that offer different types of tools that can
be used by their investors. Some of these tools include binary options trading signals or
automatic trading services. Make sure to choose a platform that offers the tools that you
prefer.

Demo Accounts
One of the best ways to learn more about a binary options broker is through the use of a
demo account. Many brokers have designed demo accounts for potential clients to use in
order to get comfortable with the software and trading platform offered by the broker. If
the broker you are considering for your trading needs offers a demo account option, make
sure to take full advantage of it as this is a great way to practice binary options trading.
Customer Service
When it comes to any type of investment
platform, customer service plays an
important role. You want to make sure that
you are going to be able to get the help you
need with your account when you need it.
Before investing money with a broker,
contact their customer service to ask
questions. This will provide you with
answers about how well they treat their
clients.

User Interface
All dependable and professional trading programs provide simple user interfaces for their
clients. These simply designed interfaces help conserve time and effort for traders. Most
binary option software programs are web based and should be simple programs that offer
interactive controls.

Multiple Asset Investing

When professional software is used investing will not be restricted. A dependable binary
options broker will provide a way for investors to make several investments in a number of
different assets such as stocks, commodities, and forex. Multiple asset investments will
increase the overall profit margin for the trader.

Information About Expiry Dates

A dependable broker will provide expiry dates at least once each week. There are some
brokers that offer expiry date information on a daily or even hourly basis as well. In order
to have maximum control of your trades, there is a need for the maximum amount of
details about expiry of options.
Supported Languages
Technology has opened up many global trading options and because of this it is important
to consider the languages that are supported by the broker. Many platforms are offered in
several languages, which makes it easy to
find one to meet your personal needs.

While many binary options trading

platforms have a lot in common, the way to
make trades on each broker will differ in
some ways. Looking at the initial deposit
amount, the amount and types of bonuses
that are offered, the maximum payouts
from the broker as well as which deposit
and withdrawal methods are supported can
help you determine which broker is right for
you.

A broker that offers a free demo account can be a great way to learn more about the
platform without spending any of your money.

Creating a Binary Options Strategy

One common misconception about trading binary options is that it can only be done by
binary options experts. However, there is no requirement of having to have a binary
options education or other type of financial
trading in order to begin trading binary
options.

Most investors who are successful at

trading binary options utilize simple
methods and trading strategies that can be
learned in a short amount of time.
Essentially, traders of any skill level will be
able to grasp the concept of trading and can
create a binary options strategy that works
best for them.
Minimizing Risks
The first step in creating a trading strategy for binary options is to learn how to minimize
your risks. There are certain binary option signals throughout the market that you can look
for. These signals will be discussed in further detail later. When it comes to reducing risk
there are several principles of trading that can help. In order to lower the amount of risk
involved with trading binary options consider the following:

€ Do not invest your entire capital at once

€ Before investing carefully review the dynamics of the trading asset

€ Only invest 5 to 10 percent of your current equity for each placement

When it comes to assets, there are several from which to choose when investing in binary
options trading. One of the most effective ways to minimize your risk is to focus your
research on one asset. Only trade assets that you are familiar with, such as the dollar/euro
exchange rate.

Making consistent trades on one asset will help you become more familiar with it and
predicting the direction of the value becomes easier over time.

There are many different strategies that can be used in order to become a more successful
trader. Below you will find an outline of 6 different strategies that you may consider using
during your trading career.
Trend Strategy
This is a basic strategy that is used by both experienced traders and beginning traders.
Often times you will hear this type of strategy called the bull/ bear strategy. It focuses
on monitoring the rising and declining trend lines of a traded asset.

If the trend line is flat and it is predicted the asset will go up, using a no touch option is
recommended. If the trend line shows an asset will rise, choose the call and if the trend
line shows an asset falling, choose a put.

The trend strategy is the same as a call/put option except that you will choose a price
that the asset must not reach before the selected time period. For example, the current
share price for Google is $540 and the trading platform is at the no touch price of $570.
The percentage for returns is 77%. If the price of Google does not reach $570 after the
allotted amount of time there is a gain.
Pinocchio Strategy
Using this strategy is recommended for when the price of an asset is expected to go up
or down drastically in an opposite direction. If it is expected that the value will go up,
choose the call and if it is expected to drop, choose put. It is best to practice this strategy
using a free demo account from a broker.

Straddle Strategy
The straddle strategy is best used when the market is volatile. It is also good for when
there is breaking news about a specific stock or when the predictions for the experts are
afloat. This is a strongly regarded trading strategy throughout the global trading market.
The straddle strategy allows a trader to avoid a call or put selection, but instead using both
on a particular asset.

The idea is to use the put when the value of the asset increases, but there is a belief that
the price will drop soon. Once the decline starts you will place a call option on the asset as
it is expected to bounce back quickly.

This strategy can also be used in reverse by putting a call on assets that have a low price
and then placing a put on the rising value. This will increase the chance of success for at
least on option by producing a trade that ends up in the money.
When the market is up and down, this is a great strategy to use.

Risk Reversal Strategy

Many expert binary options brokers utilize the risk reversal strategy. The goal of this
trading strategy is to lower the risk factors associated with binary options trading and to
increase the chances of gaining a successful outcome to result in positive profit gains.

This strategy is completed by placing call and put options at the same time on an individual
asset. This can be extremely beneficial when trading assets that have fluctuating values.
Since binary options operate on only 2 possible outcomes, trading on opposite predictions
for a single asset provides a guarantee that one will come out in the money.

Hedging Strategy
The hedging strategy is often referred to as pairing. This strategy is used most often by
binary options traders and investors as a way to protect and minimize the associated
risks of this form of trading.

This strategy is similar to the above as it involves putting calls and puts on the same
asset at the same time. This means that at least half of the trades made will generate
successful outcomes. Hedging your bets is one of the ways to help prepare traders for
any outcome that may arise.
Fundamental Analysis
A fundamental analysis is not so much a trading strategy, but more of a way for traders to
learn more about the asset they have selected. Conducting a fundamental analysis of an
asset increases the chances of being able to predict the future prices of an asset correctly.
It is important to look at all of the financials regarding the particular asset or company. This
includes market shares, financial statements, and earning reports.

Reviewing this information will provide the trader with a better understanding of the
asset’s previous activity. Understanding how the asset has behaved in the past will help a
trader make a stronger prediction of how the asset will behave in the future.

Using Binary Options Signals

Once you have studied different binary options strategies and have gained an
understanding of how binary options trading works, it is time to utilize some of the tools
that are available to help you make more informed decisions about binary options trades.
One of the tools that you can use to improve your trading strategy are binary option
signals.

These binary options indicators can be identified on your own simply by monitoring the
financial news. This will require you to be diligent about monitoring the financial news in
order to identify trends in the market.

For individuals who do not have the time to

scour the financial news in order to look for
trends and spot ones that will be beneficial,
there are binary options signals providers.
These are third party services that are often
offered to traders. Sometimes these
services have a monthly subscription fee
and some are provided by brokers as a part
of their services.

The trading signals provided by these third party services are generated through an
automated system that uses an algorithm and analysis of historical trends. Traders who
subscribe the services are alerted with these signals.
When you start identifying binary trading signals you will start to notice that there are
many types of signals found. The most common types of signals are price trending signals,
market signals, and timing signals.

Trending Signals
One of the types of signals are trending signals. Financial assets are cyclical in nature and
tend to move in patterns. By studying the values of these assets over time you can find if
there are any trends that are related to the changes of an asset’s value. Christmas retail
sales, and quarterly earnings reports are value trending signals as they can be used to
pinpoint changes in value as they occur at a set time each year.

Market Signals
Another type of signal are market signals. These can be applied to any type of financial
asset including currency pairs, stocks, indices, or commodities. For example, if a certain
financial asset is historically influenced by new economic data releases such as GDP
growth, or the unemployment rate, this could be a signal of how the asset will react for
the future.

Timing Signals
The final type of signal is related to trends that are identified during certain trading hours
for the financial asset. Since many markets are traded within predefined trading hours,
 there are signals that exist when certain time frames approach. For example, there may
be a trend for a financial asset around the time the market opens for the day or when
the market is closing for the day.

As a trader, identifying the patterns and trends of financial assets are one of the best ways
to improve your trading performance over time. The changes of the value of a financial
asset typically occur in response to something that either provides a negative or positive
opinion about that particular asset. When you begin to identify more binary trading signals
you will be able to notice how they affect your trading success.

Making Money With Binary Options

It is possible for even the beginning trader to make money in binary options. However, with
that being said trading binary options successfully is not easy. It is important to treat binary
options trading just as you would any other type of investing.

You need to study the markets and learn about all of the different tools that are available to
help you succeed. When it comes to making money with binary options, education is key.
The more time you take to learn about the market, the better off you will be.

Most quality brokers will offer an educational site for you to use once you have signed up
for an account. These educational areas can be extremely useful, especially if you are new
to binary options trading. Even experienced traders will often find useful information in
these educational areas.

There are several mistakes that investors make when they start out trading binary options.
Here are a few common mistakes to consider and avoid when you are just starting out.
• Emotional Influence: emotions should never influence your trading decisions. You
need to have calm and rational thoughts in order to succeed as a trader. If you are
angry, stressed, or just simply not in the right frame of mind, take a break from
trading until you can enter with a calm mind.

• Making trades that are too big: it is important to understand you will have losses.
Even the most experienced traders have losses. You should not let one trade affect
your balance in a way that could affect your future trading. A good rule to follow is to
never make a trade that is more than 1/15th of your account value.

• Repeating mistakes: many beginners tend to not learn from their mistakes. Keep a
trade journal in order to keep track of mistakes you make as well as when you learn
something different.

• Quitting: it is important to give yourself a learning curve. You are not going to be
great at trading right away. Keep with it and it is possible to make money trading
binary options.
The main key to making money trading binary options is to control the risk. Here are a few
tips to follow in order to become successful at binary options trading. € Use a signal
service: these services can help tilt the odds of making money in your favor. There are paid
services as well as free services available. Use these tools to help you follow trends and
become better at picking winning trades.

€ Technical indicators: there are numerous indicators out there. When you have chosen
an asset, research it and learn more about any indicators that can help you make
good choices.

€ Try Stock Trading First: trading stocks is less volatile than binary options trading. Learn
about trading stocks first. When you can be correct on over half of your stock choices,
you can take this knowledge and apply it to binary options and increase your earning
power.

€ Performance tracking: one of the best ways to improve your overall trade performance
is to keep track of your trading. Most traders find that they are better at trading
certain assets than others. When you find a number of option trades that you
consistently make a profit from, choose those and increase the size of your trades.
 € Buying the right options: it is important to know your trading style and purchase the
options that work well with it. There are some options that work best in short term
trades while others are best for long term trading. It is important to realize this and
make your trades accordingly.

Making money with binary options is not easy, especially for beginners. However, with the
right tools in place it is possible to earn a decent income from this type of trading. The
most important thing to do is learn as much as you can about the different assets that you
want to trade.

Learning the trends for a

particular asset can help
you reach your goals of
making money trading
binary options. Do not give
up if you are not successful
right away. This is a
mistake that many people
make. Keep trying and
learning and eventually
you will become
successful.

Conclusion
Unlike the forex or stock markets where slippage and price gaps can occur, the risk involved
with binary options is capped. In binary options it is not possible to lose more money than
what you paid for the trade. Even during quiet markets it is possible to get better than
average returns for your investment. When forex pairs or the stock market is not moving, it
is difficult to make a profit.

However, with binary options you already know the payout. If you buy an option for $25
you are either going to make $75 if it ends in the money or lose $25 if it does not. The
reward risk ratio in this scenario is 3 to 1, which is not something that you will find in most
other types of trading.

On the flip side, the amount you can make on any given asset is capped. It does not matter
how much the option moves in your favor, the most that it will be worth is $100. One of the
ways to potentially profit more is to purchase more option contracts for an expected price
move.
As binary options are only worth $100, it makes this form of trading accessible even to
those who have limited trading capital as there are no day trading limits applied. For an
average of $200 you can begin binary options
trading on almost any broker.

Overall binary options are based on yes and

no propositions. Your potential profits or
losses are determined by the price that you
buy or sell the option at. When the option
expires it will either be worth $100 or $0. The
risk and the reward of this type of trading is
capped and most brokers allow you to exit
options at any time before the expiry in order
to lock in your profit or to reduce your losses.

While entering the binary options trading market is simple and has a low cost, this does not
mean that it is easy to make money. You will need to do your research and take your time
learning about binary options if you are going to be successful. You should only trade with
capital that you can afford to lose.

Consider trading on a demo account first so that you are comfortable with how binary
options work before you invest any money. This is the best way to learn not only about
how binary options trading works, but also will give you an idea about the binary options
software that the broker uses and whether or not it works with your trading style.