Binary options are a special form of online financial trading, because they can not only be traded with the usual brokers, but are also available from some bookmakers. Why are binary options offered where otherwise only bets are placed on horse racing, soccer and other sporting events? Are the popular binary options not a serious financial product, but are binary options gambling? We have dealt with the structure of the binary options in more detail and answer<131 in the following article>All important questions regarding the seriousness and the risk when trading binary options.
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Binary options are structured like bets
When trading with binary options, the trader submits whether the price will be higher or lower after the predefined time than at the time the bet was placed, If he is correct, he wins a fixed amount, but if he is wrong, the stake is lost. This is the same principle as for a bet, for example, where predictions are made which team wins a game or which horse reaches the goal first. In this respect, binary options are financial bets, because they have the structure of a bet. Professional traders and bookmakers, however, are very reluctant to speak of binary options as bets, because this puts them in a negative light. Binary options providers and traders generally want the public to get a better picture of binary options as a serious investment. It is counterproductive to call binary options bets, even if, strictly speaking, they are exactly that. In contrast to pure gambling, binary options can influence the chances that Winning bet.
How binary options financial bets are won
As we have seen, binary options are actually a form of bet. However, it is not entirely a matter of chance how many bets are won by the dealer and how many are lost. If binary options were gamble and there was no chance of influencing the probability of winning, there could not be professional traders, since the profits and losses change earlier according to the laws of statistics or later would distribute according to their probability and thus only the broker would make a profit.
Now there are traders who actually make it with binary options also long-term profit To make. Although these traders also take a high risk, because of the high variance in the binary options there is a great risk of loss at all times, but they make it through a good risk management often often, also assert itself in the long term. Although these traders can by no means win all their bets, they also lose a large part of their trades. The number of won trades is sufficient to compensate for the losses and to achieve a bottom line profit. The professionals achieve this by a good analysis of the price trends and by placing a trade only if it has a positive expected value for them. This means that these traders do not simply "guess" how the price will develop, but use mathematical models and special supplementary programs to find out when the price of the underlying is a
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Binary options at the bookmaker?
Since binary options are actually bets, they can not only be traded with the online broker, but also become also offered by some bookmakers as financial bets. Professional traders, however, trade almost exclusively with online broker, which is related to the significantly larger selection of underlyings. Since the professionals often use tools for automatic analysis of the prices and then only check with a corresponding trade signal whether the proposed trade is worthwhile, they can do a variety in a short time scan of available courses. In order to receive as many trading signals as possible and thus have a better selection of promising trades available, the provider must provide a correspondingly large number of underlyings, which for the Bookmakers are usually not the case. There is usually only a very manageable range of binary options. However, this does not necessarily mean that the bookmaker offers worse conditions. Often the betting odds are even relatively good and can keep up with the brokers. So it is not wrong if beginners take a look at financial bets even with the big bookmakers. For ambitious trading, however, a long-term rather good broker is recommended.
Increase the chances of winning with bonus payments?
Many brokers offer a bonus. Here traders receive additional credit, which they cannot, however, pay out directly, but must first use to trade with binary options.
Such bonus promotions are Basically an advantage for the customers, because whoever receives more credit for their money will of course also make more profit on average than without a bonus under otherwise identical conditions. However, the bonus promotions should always be considered critically, because a broker with a bonus is not always automatically better.
A bonus should always be in connection with the Trading conditions of the broker are considered. First and foremost, it is important how much money the trader receives in the event of a profit. This depends on what percentage of his trades he has to win in order to get a positive balance. With a bonus, the customer can calculate how many trades he has to place in order to meet the required wagering requirements for the bonus and to be able to pay it out. Then he can calculate what percentage of it must win so that he receives a total profit. The bonus must also be taken into account here. If you compare this result with other brokers without a bonus, it often becomes clear that a bonus is a nice extra, but not always the broker with bonus that offers best conditions. The fewer trades that need to be won as a percentage in order to also make a total profit, the more worthwhile is the trade with the respective broker. Whether a bonus is used now or whether the result comes without a bonus offer is secondary.
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Binary options financial bets test for free
Beginners interested in binary options trading do not have to invest money to try trading themselves. Many binary options brokers now offer free demo accounts with which traders can test all functions of the trading platform with play money. Trading takes place at the real prices, only that no own money has to be used and therefore no real losses are threatened.
To open a free demo account, a little information is usually sufficient. A full verification, as required by law for a real money account, is not required for the demo account. Interested beginners can get started with play money trading to get to know binary options.
The free demo accounts are of course offered by the brokers in order to win over customers, Therefore, owners of such a demo account will likely receive an email from time to time, explaining the benefits of a real money account and encouraging them to make a deposit. Do not allow to make deposits that you actually do not want to make or that exceed your financial circumstances. Only binary should be used for binary options trading, the loss of which is not particularly significant for the trader, because a total loss is not unlikely and must be are always taken into account. For many brokers, the telephone number must also be specified when registering for a demo account. Here too, unfortunately, some providers try to persuade users with intrusive advertising calls to open a real money account.
Binary options only place bets with reputable providers
Es Binary options are bets, but that does not mean that trading must necessarily be dubious. There are also differences for other bets: While, for example, the regular submission of a lottery ticket has no negative taste for most people, bets apply in hidden back rooms as dangerous and would not be considered by most people. It is the same with the binary options. There is a large selection of brokers and while many of them are serious and regulated, others have the reliability of an illegal back room betting agency. Therefore, when choosing a broker, make sure that the provider has a valid license from an official tax authority. The brokers are regulated by the competent authority of the country in which the headquarters of the company is located. If the broker has other offices in other countries, there is usually additional regulation by the relevant authorities in these countries.
Professional traders take a very close look at a broker before registering with it, after all, a lot depends on whether they get their profits reliably and no fraud takes place. Brokers with EU regulation are preferred because there are uniform and very strict guidelines that ensure optimal customer security. Should there be any legal problems, comparatively customer-friendly EU law is applied.
Don't risk too much
Binary options are highly speculative and there is always the loss of the entire invested capital. Therefore, think carefully how much money you want to use to trade this financial product! Only with money, the loss of which you can easily cope with, does binary options trading make sense, because this loss can occur at any time and should not get traders into trouble.
Before you register with a binary options broker, find out whether they require a minimum deposit. Fortunately, there are now many providers who only need a low minimum deposit, or who even work without any minimum deposits. Also, don't be tempted by bonus offers or other promises to deposit more money than you'd like.
Conclusion: binary options are bets and not suitable for every investor
The popular binary options are actually bets. The professionals know this, although they are very reluctant to call trading a bet, since the binary options are similar to gambling and do not have a good reputation. It is entirely possible to make money with options trading, because the chances of winning can be influenced to a certain extent. Various mathematical analysis techniques are used for this purpose, which give the trader an advantage in predicting the course of the price. However, the accuracy of the course prediction is very limited, because here too many unpredictable factors play a role. Therefore, binary options are subject to high variance and profits and losses can fluctuate greatly. Critics who claim that binary options are gambling are therefore partially right, because precise control is not possible. Therefore, high losses always threaten and the total loss is quickly possible.
For the reasons mentioned, binary options are not suitable for investing money that is already for others Purposes are planned, or is required to maintain the standard of living. If you want to trade binary options, you should only do with capital, which you separate from other assets and do not plan for. Should there be a total loss of the deposit, this can be coped with without any financial problems.
In any case, be critical of the choice of a broker! There are many good providers, but unfortunately there are always companies in the industry who cheat customers through manipulations or work with other unfair methods. Pay attention to a reliable regulation, preferably by an EU authority and read the general terms and conditions carefully!
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