Greetings all, thought I would throw my 2 cents in here.
Before I even toss my opinion out on Binary Options lets keep in mind that 95% of individuals attempting to trade in the long run fail for one reason or another. (I think this is the accepted %) Top that with when trading binary options your risk reward ratio is by default in favor of the broker, 1 loss in binary options takes almost 3 wins to recover with proper money management. To make things even better the Binary Options industry attracts a lot of 1st time traders who quite honestly have no clue what they are doing and opened up an account with a shady broker because they saw some BS video on YouTube promising riches. Combine all that with the fact that as a mostly unregulated industry (progress is being made) the majority of individuals by default are going to lose there money, and the few that actually do make some money probably picked a shady broker and then get screwed out of it. So keeping all that in mind let me get away from all the doom and gloom and lets look at some of the positives about Binary Options. (Yes there are a few)
Binary Options for someone learning to trade IMO is a great place to start as long as you head in with the expectations that you will not get rich just like traditional trading. You have to be prepared to build your account slowly over time and control your self when draw-down hits and not revenge trade. If you do you homework there are a few brokers out there who offer no deposit demo accounts, I would highly advise you to get a demo account and trade with that until you hit a bare min of 60% ITM (In the Money aka a winning trade.) As the avg payout from a Binary Options broker is 70% or higher that is your goal to hit before you even consider going live. If you can not hit it then you have no business trading Binary Options, or you are a glutton for punishment and want to feed your broker money. I see to many people think because trading Binary Options does not involve setting a SL or TP that it will be easier and for some magical reason they will be successful. That is 100% completely untrue, as a Binary Options Trader I use the same chart for my “BO” trades as I do for my short term scalping, so if we look into it a little bit that means I am using the same principles for scalping and trading BO’s. That right there should set a light bulb off that you need to know your basic fundamentals about the market before you even attempt to trade Binary Options, and if your a unsuccessful traditional trader, you are going to most like fail at Binary Options. The chart I trade of does not magically change when I do a scalp or a BO trade and become easier because I am trading Binary options. I will say the number one thing Binary Options has helped me improve upon is my entry point when intra-day trading. If i had to guess I on average pick up an extra 1-3 pips a trade due to binary options helping me refine my entry. With Binary Options a bad entry will get you a OTM (Out of the Money aka a loss) more often than not.
So on to the shady part of binary options, once you can hit a 60% ITM on your DEMO account then its time to start looking for a broker. If you are a trader from the United States and prefer longer term trades then go with NADEX, they are 100% regulated and legit, and if you fall into that group you can stop reading this post now and head on over and open a Demo account and demo until you have doubled your account with proper money management, and once you have do it again and for good measure do it a third time then go live.
Now if your into shorter term trades 5 mins to 30 mins welcome to the world of shady brokers, aka the bucket shop. Your first step will to be to research any broker you may want to invest with, and if possible find someone who is using them and has withdrawn funds. Picking the wrong broker at this point and getting screwed out of your money really sucks. Once you have selected your broker then my advice is to deposit the minimum amount they require to get the account going trade for a bit and make a withdraw, if all goes well then ramp up the deposit a little bit. Unlike traditional trading if you have 10k in capital you do not have to deposit it all with a broker to use proper money management, if you are trading 2% of your capital deposit 2k and keep the other 8k safe in your bank account. You can still trade based off a 10k account but the broker only has 1/5 of your capital.
Some brokers are going to offer a bonus with your deposit, DO NOT TAKE IT. They will lock you into a trade volume that you have to hit that is ridiculously high and you can not withdraw ANY of your money till you do. I go as far as to get a email from the broker stating stat I will be depositing 2k with them and there will be no bonus, free trades anything attached to the account and I am free to withdraw at any time. There are a few brokers out there who offer a segregated bonus if they do feel free to accept those just make sure there are no strings attached. A segregated bonus does not effect your initial deposit and is only made available after you hit a pre-determined trade volume, but you are free to with draw your money at anytime with no restrictions.
Last bit of advice is when dealing with brokers that is the time to put your foot down don’t let them pressure you into depositing more money that you want to its there job to weasel as large as a deposit as they can out of you, its your job to protect your money.
I hope you enjoyed the little bit of info I provided and if you have any questions please feel free to ask.
I apologize for any typos in advance. And parsifal23 nice to see you here