Frankly speaking, I don’t consider binary options as a trading process. It’s gambling. Though it becomes very popular and more brokers offer it.
If I remember rightly, there was a video on YouTube that went into the mathematics of binary options. If memory serves me correctly, the take home message was that you needed to be right better than 55% of the time into order to breakeven.
I also saw that video and after that I created a calculator on my website where I can easily enter numbers of particular broker because they are not the same. One of them offers 80% in the money payout but no refund, next one 75% and 10% refund if your trade ends out of the money.
After playing around with it and entering different broker offers I did get the same number on average. So you’ll need to be right in at least 55% of your deals to gain profit.
Binary options is more like gambling because you do not own anything when entering a deal, you just place a bet on a particular asset price change, however it is also not fully gambling because you’re not dependent on some machine or lottery. You can analyze the market and take a solid decision. Of course, risk is involved but if you’re willing to invest, there are no options where you won’t find any risks. I like that I always know the maximum amount that I can lose and these deals are quicker than other trading methods.
If u r not profitable from Forex trading no matter of what reason, then DON’T even consider can make fortune in Binary Option. In forex u predict price, in binary option, u need to predict Price + Expiry Time.
I been in forex for 8 years n becos of curiosity try on binary, most broker dont have free demo account , unless u deposit in real account, then only they provide u demo account. After i had a demo account n try out my forex strategy that profitable along the way, but disaster in B.Options, BECAUSE U STILL NEED TO PREDICT THE TIME. most of the time my prediction price reach target but after the expiry time. :46:
So take care for those in BOption
Sorry, but I can’t agree with you. BO are in my opinion the same hard work and dedication thing as Forex. Yes in forex you care only about price changing your side, but in forex you may loose all your mmoney from just one hard price change, Bo giving you chance to control your every move. Also brokers are different also in forex, because choosing a broker is one of the most dificult aspect in that field, I’ve seen plenty of Forex brokers who are scaming people of too… So BO or FX are the same for me, you need to understand that you will have to work hard to get any profits here.
Like a casino, binary options’ odds are stacked against you because the brokers can be shady (if you’re experiencing too much success). However, I wouldn’t call it gambling. I think just like forex, if an amateur trader comes in taking silly risks then it can become gambling. But with careful analysis and discipline, you can take calculated risk: this is what all trading is. After all no one can predict the market. I trade binary options in a similar way to scalping forex–in and out. I trade 2 five-minute candles on average at about 70% accuracy. Like someone said, you generally need to be above 55% to be ITM. No one can predict any market for 5 minutes, 5 hours, or even worse, 5 days. Its all about having the probability stacked in your favor when you place any trade. One way to help yourself in binary (if you don’t know how to trade it) is to subscribe to a good signal service (although only few are out there); and trade the same amount on each trade (from 1% to maximum 5% of risk capital). If you’re not having success, simply move on to another investment vehicle.
Hi everyone, there are lots of questions about binary trading and whether or not its like gambling, I’d just like to say first off the only binary broker I’d ever consider using is Nadex being that they are regulated by the CFTC and they are an exchange and really not a broker and secondly as far as the gambling thing gos I really can’t see any reason why someone who is good at interday trading wouldn’t far well trading forex binaries. But if you suck at spot you’re going to suck at binary also! Anyway I do have a practice account with Nadex and last night I posted a couple of trades I did till they expired and talked about some of the advantages and disadvantages to trading binaries and spot on Forex Peace Amy. Use the link below if you are interested. My posts are the last ones at this time on pages 11-12.
Binary Options - What are they and how do they work? - Page 11
Well i have been trying to succesfully trade binary now for a year or so, i have lost in total around 1.500€ spreaded out over different accounts. The only one i put to blame for that loss is me, myself and i.
I had live accounts up to 6.000€ that sprouted out of a single 500€ deposit growing in a week or three- four and sometimes even in a matter of days. But my greedyness and lack of discipline in money management and most of all thinking i could trade at any given time regardless the hour and market condition made me blow my whole account every single time.
Is it betting? Yes ! But… its an equal bet and in my eyes a lesser bet % risk as opening a position of the same amount u would do in binary then in forex or any other market stocks indice… u take a call, long or a short put. U have exactly the same choices with exactly the same parameters to tweek then on forex.
If you dont believe me then keep on reading…
So if u argue about the fact that no one can forecast the market direction/position in time to come
…then my question to all the hardcore forex traders that refuse to study in the new oportunities this instruments give us to play the market…
think deeper about why woud u place those positions in any other market whilst calling options betting and your game ‘speculating’ or trading… remember u admit… forex/stock market … no one can 100% correct predict its outcome.
U forex traders that point fingers to the binary options are as big of a gamblers as the ones u assumingly point your fingers too. To this excent that most of the forex traders nowadays simply rely on signals and EA’s wich are all very unpredictable in behaviour + u need constant monitoring, and instead of putting the decsion to take a trade or not in your own hands, u put responsability on the machine afterwards. So what where you betting on while installing that indicator or EA? Or better said hoping/believing in? A robot that trades for u? everyone would be millionaire…
Nevertheless currency ecxhange and stock investments have been around from the moment the first roads or sea routes connected the ancient world. Spreads, shorting and options followed in the years after, tools created to allow outsiders to ‘speculate’ on the markets in any given direction. Speculating itselve is allready a form of ‘gambling’ but phrased in an intelligent way. Now let me explain u… in binary you can always ( with a good broker ) ‘open trades’ longer then 5min and with a longer expiry time those positions can be resold to the market at any given time ex. the last 6-7 minutes before expiry.
Meaning u can ‘speculate’ in exactly the same way as a classic forex trade,
- u decide the entry point. oR when u enter the market.
- u decide the stop loss and in the binary trade, the the stop loss simply is the amount of your ‘bet’,
unless u do an insured trade for 5-30% incase of OTM. But…
… u dont need more money then your initial bet to cover eventual drawdown while ‘speculating’ on a reverese !!
… u know exactly what u can loose or win and most important of all the re-sell before expiry to the market is
nr… - u decide when u take profit and execute its close at any given momentum and not 3-6 pips away from current position as in forex… and why would u always aim for the 80%-100% return on a binary option trade?
4 If u trade wise, u do not await the expiry time but u 'take ur profit once u have 50%-60-70% and u dont feel it going further up or down anymore.
…and for the record… 80-90% of the forex 'pips revenues i see in history of traders are not even 10-20% of the risked position, ok… the risk was covered by a stop loss, but that can be adjusted in the trade to allow further drawdown whilst ‘betting’ - or should i use ‘speculating’ on a reverse in the market before u draw down too far too feel good… is’t this an expiry time on itself? The stop loss in forex ? Yes and its the biggest bet on itselve,… how much will the market go down before you reach your goal position? Thats a bet u cant predict only guess for…
so it can be very well that a minute after opening a forex position the market makes a last reversal movement and rallys down 100 pips and u had a stoploss of 80 !!!
… Well there u have it, u missed out " again " on a perfectly do-able trade because two minutes later it shoots up again , bam to +220 pips and it would v hit ur take profit level… but it didnt… cause u have put your own expiry time / stop loss , " to secure your BET " let that be clear… based on the amount u were prepared to loose in this “BET”…
So please be honest and without prejudice about unfamiliar trading forms, and explore all new ways of using these trades in existing strategies, to cover losses or as extra tool to make money on exactly the same direction u were already hoping for. Why not make an EA that triggers a long term binary trade based on good analyses up or down with an expiry lets say end of day or till u take profit with your forex posotion.
Why not trigger reverse 1- 2 - 5 minute trades whilst your position is drawing down to cover losses or simply on top of your exisiting position semi or automatically done by the same EA that triggered your trade or by another one u create to monitor the ‘actual’ ongoing trade, then u start using another time frame to compare the market with, u use the timeframe of the ongoing trade, how fast its going up where it came from, where u predicted it to go etc… and it calculates 30 sec or 60 sec call or put trades that react on the movement on the market during your ongoing position…im only throwing a few ideas to look into. Why not use end of the day binary trades that are not sensible to drawdown limits to cover a loss trade due to a stop loss… etc… etc… i think it’s time to get creative…
Don’t know if any of u saw this movie about floor traders, its a must watch!
but as a reply to your post:
Floored: Into The Pit - Epic Trader Movie!
please ffwd to the minute 14 and 20 sec
Listen to the commentary Pete Najaran cnbc analyst and co founder of optionmonster.
about going to his job on the floor of the chicage exchange in the 80’s.
“wether people like to admit it or not , this is a form of gambling:
if u buy a stock u are ‘buying’ the idea that sock is going up.
it’s a gamble going down that decision because you risk something.”
really great thread. It makes me know more about binary…
Thanks anyway for this thread. I hope I can be success in binary option.
did you request to withdraw the profit before losing ？ i think all the investment is two way , up and down,
like profit and losses
when profit is already made,don;t expect for more, otherwise, losing will come back to me . it;s kind of scary
The concept of binary options is a great, but the implementation by the binary options brokers is very poor. The issue is that the payouts are terrible, so the “brokers” (not real brokers, they are in fact dealers) keep a big slice of the pie for themselves.
If you like the concept of trading binary options, then trade VANILLA OPTIONS ON AN EXCHANGE. You can construct a vanilla options trade that is almost the same as a binary options trade, except with much better payouts.
Say the EUR/USD is trading at 1.1400 and you think it will go down over the next few days. Buy a put on the CME Globex exchange at 1.1450 and sell another one at 1.1350. During market hours your potential payout will be 95% or higher. One main difference vs binary options is that is the price comes in between 1.1350 and 1.1450, you will get a partial gain or a partial loss, but this has no meaningful impact on long term profitability.
I have been trading various instruments for over 15 years, but I have only been trading vanilla options on currencies and commodities since September 2014. However, in that time I have had 73% winners with an average payout of 80%, vs an average loss of 79%. This is approximately equivalent to a 100% payout in binary options terms.
Other differences:
- The expiry dates are on a weekly or monthly basis, rather than shorter expirations with binary options
- Vanilla options are traded on an exchange, rather than against the dealers you are forced to deal with when trading binaries.
- No conflict of interest when trading vanilla options on an exchange, whereas there is a huge conflict of interest with binary options.
Ian
I think that all people will still winning in binary, about TIME it doen’t matter for me, if you are have many experiences in forex trading and know well about currency volatile, I think its very possible to gain profit there. If you are have too little experience with forex, don’t wish to get profit with…
If you’re trading Forex, you can try Binary too. This relatively equal to Forex but expiry time. However, the main fact is ‘Binary Options is even more riskier than Forex’. So before you jump, try to be technically and fundamentally experienced. You can start your career with CToption, they provide friendly support and effective trading tools.
Hello
I hve been trading options since 1993. Binary options as far as i have seen do not offer you a strategy. The main reason for options is to either hedge a portfolio of stocks by buying puts or writting calls. The other method of using options is to use strategies for making profits (Straddles, Strangels, Butterfly and Spreads) by entering 2 or more contracts at the same.
Example: you expect a huge move in the near future, so you buy a call option and a put option at the same strike price and same expiration at the same time. You paid the premuim for both contracts. If the market stays in a trading range till expiry you lose your investment (which is calculated) if the market moves up or down and starts trending beyond the strike prices then in either way you are ITM and profits are unlimited till the contract expires or till they move back to the original price (unless you sell them once ITM)
I tried to apply any of these strategies in binary options but it seems to be it is not possible and i have to either bet on the upside or downside which does make it more like a gamble.
The idea of buying 1 call option IBM for example, is that is it cheaper than buying 100 stocks IBM. The difference is that by directly buying 100 stocks IBM you can hold your investment for the long run even if it corrects for some time and even receive dividends. If instead you buy 1 call option IBM your investment horizon is limited and so are your profits while your loss is limited to the premium you paid.
If you want to try options i would suggest to stay away from binary and try normal options combined with a stock portfolio. Good luck!
I had a really good experience in binary trading , I worked with many brokers , I worked with 24 options , and optionrally , but the best broker and the best service was in growbinary , they helped work in a professional way , and based on news and financial events , not gambling as everybody thinks ! I have more than 3 years experience in binary trading , I would love to help .
Is it possible to gain playing binary options??? Anyone with profitable trades?? thanks
Good explanation, thanks helpful mate
Its pretty much the same as Forex
More easier than forex trading…