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What are Binary Options?

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What are Binary OptionsBinary options are essentially simple, and can turn into a profit source for an inexperienced trader even. Many traders call them "financial spread betting” and they are partially right. Pay attention that we used the word "partially”! In fact, this form of trading requires traders making a prediction on a certain asset’s (for example, crude oil) price direction – high or low – at the particular time. This means, that the traders must make bets in a way. These bets can return up to 71% of the investment. If you stake on $100, the right prediction may bring you back $170. Fell free to use end-of-hour (EOH) or end-of-day (EOD) strategy developed for short-term binary options trading. The long term trading comprises such strategies, as end-of-week (EOW) and end-of-month (EOM) ones. 

What are the Differences between Binary Options and Financial Spread Betting? The difference is obvious since betting means making a bet, depend on luck, while binary options suggest depending on either fortune or your own knowledge of the market, logic and famous Forex analysts’ forecasts. 

Observing all analysts sharing one opinion that the Euro exchange rate falls the nearest week, feel free to log into the random trading platform and buy a put option (the option making the profit from falling prices). Being able to make all possible bets or so-called "investment”, you should keep in mind that the higher is the bet, the greater is the potential win. For example, if you stake on $100, the right prediction may bring you back $170, but if you bet $1000, you may get a return in $1700. 

However, remember the high bets may lead to greater losses. So, make deals in case you are fully confident in your prediction and keep a cool head. This is true for cases when all analysts agree that the price’s fall or increase will surely take place. 

Finally, I want to give you one more piece of advice: do not turn trading into gambling and avoid making random decisions. Choose your own binary options strategy (no matter whether it would be based on technical, fundamental analysis or social trading). The most important thing is to pick up the strategy suiting you best that will lead you to lucrative trading. 

Have a good luck!

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