The forex market has caught a lot of attention in past couple of years. Maybe because the promises seen on the sales pages of forex brokers and vendors seem to point to it as a way of easy money. However, because this market has some peculiarities which traders must be thoroughly at home with, many unprepared traders have seen themselves at the wrong end of the market.
Investments vary in degrees and conditions. Some people will only invest with reputable institutions in order to reduce risk. With the use of popular online Search Engines, one is able to look around and search for the options that best fit them. On the flip side; with Search Engine Optimization, financial institutions (and other entities that perpetrate as such) can now search for customers who want what those institutions have.
Bitcoin is what some online investors have been using since its creation in 2009. With that and the introduction of binary options, some investors consider these crypto and cyber currencies as a litmus test of how the “normal” (or legal) markets are doing; while some have yet to approve the entire scene all together.
Pros and cons of Binary Options
One advantage of binary options is that payouts are higher, fixed and known to you before you begin trading. Another significant benefit is that you can earn money regardless of the magnitude of the price change in the stock, commodity or index you chose.
The binary options market allows traders to trade financial instruments spread across the currency and commodity markets as well as indices and bonds. This flexibility is unparalleled, and gives traders with the knowledge of how to trade these markets, a one-stop shop to trade all these instruments. Bitcoin, on the other hand, is no more arbitrary than derivatives or credit default swaps. Given that regular folks (if they’re nerdy and interested in Bitcoin) can use the currency for all manner of things, including illegal things; it’s arguably a far less arbitrary instrument.
The major drawback of high-low binary options is that the reward is always less than the risk. This means a trader must be right a high What are binary options? percentage of the time to cover losses. While payout and risk will fluctuate from broker to broker and instrument to instrument, one thing remains constant: Losing trades will cost the trader more than she/he can make on winning trades. Other types of binary options (not high-low) may provide payouts where the reward is potentially greater than the risk.