What is Binary Options Trading?

What is Binary Options Trading?

Almost everyone has at least a preliminary understanding of what Forex trading is. You open an account and begin buying and selling commodities, forex & Stocks in order to (hopefully) turn a significant profit.

However, relatively few people are familiar with the underlying concept behind trading binary options. Really, though, you should start familiarizing yourself with the basics of binary options trading, especially if the main reason that you have so far avoided buying and selling commodities, lies with the fact that you have relatively little capital or are particularly risk averse.

Binary Options Trading Basics

To summarize what trading in binary options is in the simplest terms possible, a binary options trade does not necessitate purchasing stocks, shares, or even investing significant money upfront.

What binary options trading is, is you betting on a simple yes or no question in regard to whether the price of a specific commodity will rise or fall within the scope of a predetermined time frame. A binary options trade, in this case, could take the form of you placing a trade in which you speculate that the price of gold or oil will rise or fall over the course of the next sixty seconds.

The Benefits of Trading in Binary Options

The benefits of binary options trading are simple. Any risk is fixed. At the same time, you can trade much smaller amounts than you can in conventional Forex trading. Even better, trades themselves are ridiculously easy to understand. After all, with binary options trading, you literally are betting on a yes or no trading outcome.

If a commodity price falls like you expect it might, you win. If it rises but you have bet the other way, you lose. It’s really that simple. This being the case, if you are looking for a way to make a passive income online, binary options trading might well be for you. Just remember to open an account with a reputable broker first, and like with any kind of trading, always learn how to interpret market signals so that any trade which you make is more likely to go in your favor.