how brokers make money

Managing Your Cash Flow with Binary Options Trading

Any experienced trader will tell you that if you want to continue trading with binary options, you need to know how to manage your money.

This will help to ensure that, on average, you are making more than you are losing. It will also make certain that you don’t develop any bad trading habits that could cause you to spend all of your money.

Here is a guide to managing your cash flow with binary options trading:

Living Expenses are Primary, Trading is Secondary

You should never give binary options trading more importance in terms of expenses that you need to take care of. When you get paid each month, the first you need to do is to set aside money for you rent, utilities, food, transport, etc.

Think of this as an untouchable fund. Under no circumstances should you ever take money from this fund.

You should also never take out loans or borrow money from people to trade with. This is because there is always the possibility that you could lose that entire money. There is also no guarantee that you will be able to make it back. It is vital that you think of trading as secondary income – it should always make you more money than cost you.

Calculate Affordable Losses

The first question you will need to ask yourself with binary options is, how much can you stand to lose? Now, this is not based on all of the money that you have in total. Instead, it is dependent on how much money there is in your trading account: you can use indicators.

The money that you have there, should be able to last you for a good number of trades.

Also read:

For accounts with higher amounts, you can decide to place no more than one percent on each trade.

If you aren’t starting off with a lot of capital, you can increase this number to around three percent. Whatever you choose, there should still be a healthy sum left in your account.

Adjust Investment According to Strategy

Each strategy has its own level of risk attached. The risk is usually offset by the profit that you stand to make.

The strategies that have only minimal risk may not be able to make you as much of a profit. At the same time, the riskier strategies can also result in you losing all of your money. A good way to balance the risk and your strategy is to increase investments for the less risky endeavors and reduce money for the riskier ones.

If you are wondering how to determine the risk involved with your strategy, just look at its win percentage. How much of the time does your strategy end in in the money trades?

Be Flexible with Your Trades

It is foolhardy to continue to only place a set amount of money on each trade. You need to know when to increase your investment or to decrease it.

If you are in a rut and happen to be losing trades consecutively, you should decrease how much money you are placing on the trades. However, if you do see a good opportunity, you should elevate the investment somewhat.

It is important to avoid being too extreme in either of these directions, however. It is important to analyze each trade and to determine whether your original formula works or if it can stand to be tweaked.

This is a good guide to managing your cash flow with binary options trading. Don’t be afraid to reevaluate your money management system every so often, however, if you feel as though it is not working for you.

binary options indicators

Binary Options Indicators

If you are one of those traders that go all pear shaped when asked about binary options indicators and how to use them, you have come to the right place.

Probably the reason for this is that there actually are quite a lot of binary options indicators to refer so much so that traders are liable to be overwhelmed by a lack of information and invariably end up using the wrong set of indicators. Definitely an inconvenience.

The indicators are typically used for stock markets or the Forex but they are equally applicable to binary options as well. Binary options indicators are for all intents and purposes, arithmetic values on charts.

The values in question are obtained from formulas centered on price which has four categories here: the Open (opening price), the High Low, and Close (closing price) which can be abbreviated to OHLC.

Types of binary trading indicators

As we delve deeper into binary options indicators we will find that they branch out into a number of categories and sub-categories. Here the main ones:

  • Cycle indicators – These tend to be confused often with oscillators since they appear similar to each other and invariably traders pass them up as overbought or oversold. The slight complexity of this indicator lies in the fact that it tends to plot the retracement dips, rallies, peaks and troughs of the price in cycles. They are often employed to identify the beginning and end of retracements. The most famous example for this type of binary options indicators is the Schaff trend cycle indicator.
  • Oscillators – As the name suggests, these indicators tend to oscillate between certain levels. Plotted in a separate window, they are used to verify retracements in price and usually to denote overbought or oversold conditions of stocks. The most common examples for oscillators include but not limited to Stochastics or MACDs.
  • Volatility indicators – These indicators are plotted on the chart and are typically used to find the High and Low and sometimes the Open and Close prices too. Once plotted on the chart, they are overlaid on price. The most common examples for this kind of indicator are Bollinger bands, envelopes and other bands based indicators.
  • Trend indicators – This type of binary options indicator is also plotted on a chart and overlaid on price. The norm this type when the existing price is either above or below the average price; either the existing price is a trending up or down. A typical example of a trend indicator is a moving average.

No one really knows for certain where the market will go. It is speculated that for less than a fifth of the time the markets trend while for the rest, they range or move sideways. So what does this mean for a trader trying to select the best indicator in binary options?

Of course if the markets are trending, the trend indicators are your best option. For instance an accurate idea of the existing price relative to the average price can be obtained from a moving average indicator.

Similarly, a market that is going sideways warrants an oscillator to pinpoint overbought and oversold levels so they would be the preferred choice of traders in that scenario.

Sometimes it is possible for a trader to find themselves at a loss to decide which binary options indicator to use. The most common solution here is to select an indicator that is specific to the purpose.

As mentioned earlier, these are only the main categories of binary options indicators. Afterward they branch out into various subtypes. However keeping an acute memory of them will better your chances of making accurate predictions and receiving a profit.

zulutrade

Binary Options Brokers with ZuluTrade

ZuluTrade is a binary options trading platform that is quite unique. Here, traders have the choice of following some of the leading experts on the market.

They are then able to mimic the trades that these traders are making, thus increasing their probability of being successful as well. ZuluTrade focuses on the trades taking place across the forex market.

This particular platform is ideal for individuals who are only just starting out with binary options trading. It is also useful for those who are unable to constantly monitor the market and observe emerging patterns.

However, due to its uniqueness, there are not all that many brokers that offer this platform. Here are the few binary options brokers that actually do:

AAAFX

AAAFX is one of those brokers that has a wide variety of options when it comes to trading platforms. One of these includes the ZuluTrade platform. One of the advantages of this broker is that it is based in Greece and regulated by the EU.

For those who wish to begin trading with binary options, you can open an account for as little as $100. Once this is done, you will then have the option to begin copy trading with ZuluTrade. Additionally, you can actually make up to 30 percent on each deposit that you place in your AAAFX account.

OptionTrade

OptionTrade was actually one of the first binary options brokers to be licensed by the CySEC. As such, it is a trustworthy broker in addition to offering ZuluTrade as a trading platform. You will be able to register for an account with just $100. With this, you will actually have the opportunity to take part in some risk free trades. You will also be given a cash match bonus.

Also, you will have many different assets to choose from as well. Last but not least, the potential payout is about 83 percent.

CapoTrade

CapoTrade is yet another regulated broker that allows traders full use of the ZuluTrade trading platform. For 200 in either US dollars or Euros, you can open up a standard account with this broker.

While this is a little higher than the other brokers, there are plenty of benefits that come along with this minimum requirement. This gives you access to numerous educational literature and videos to enhance your trading skills. You are also given a welcome bonus of 10 percent. The payout rate with this broker is an impressive 82 percent.

CBFInvest

CBFTrade is another great choice if you are looking to trade with the ZuluTrade platform. Here, you are able to open up a Mini Account for between $100 and $999.

In addition to many binary options guides, you will also get your own account manager and even have temporary access to a trading coach. There are also bonuses offered of up to 50 percent. There are even webinars and various other learning tools.

All of the above binary options brokers are not only regulated, but they also offer ZuluTrade as a trading platform. There are plenty of other advantages to signing up with any of these brokers, especially if you are looking to take part in Copy Trading on ZuluTrade.

Australian Binary Options Trading

Once you aware of the fact that there is more than one type of trade, you may find yourself with an entirely new question. This is probably how to choose the right type of trade for you. As you can imagine, the type of trade that you choose can greatly affect whether or not you will win a trade.

In turn, this will determine just how much of a profit you make in this venture. All in all, it is an important decision to make and one that should not be made lightly. To help you with this verdict, here are some things to consider:

Your Preferred Strategy

One of the more important things to take into consideration is the strategy that you, as Australian trader, prefer to use. This is because the strategy has an enormous impact on the type of trade that you can choose. For example, imagine that you like to use the straddle strategy so that you can minimize the amount of risk involved.

Due to the specificities of that strategy, it is the boundary trade that will most likely be of greatest use to you. This is because the broker will provide you with the outermost prices of the asset. This makes it easier for you to take the two opposing positions to ensure that you come out on top.

How Much Risk You Can Incur

The next question that you need to ask yourself is whether you want to opt for the safer route or choose something a little riskier. This is because some Australian trade types automatically carry more risk than others. Imagine One Touch trades, for example. This is because you have to now factor in a price point as well and determine whether or not it is a viable value for that specific asset. As you can see, there is an increased level of risk. At the same time, there is also a chance to make more money.

Therefore, although you may lose more often with such a trade type, you can stand to make more money as well. In terms of simplicity, the Call/Put or High/Low trade is probably the one with the least amount of risk. This is because you have to decide if the price is going to go up or down. As the payout is considerably lower, you stand to make less amount of money.

Your Own Emotions

Many traders fail to factor in their own emotions, moods, or emotional wellbeing when deciding on a trading type. Although it may seem unusual, it is actually quite important to take a look at this aspect as well. As discussed above, with High/Low trades, you have a greater chance of winning. This ostensibly means that all things being equal, you win more times than you lose. With the One Touch, however, you are probably going to lose more. If you are the type of trader that gets anxious, especially after losing a couple of trades, it is best to stick with the High/Low option. This is because you will not be able to stand the thought of losing despite the fact that you will be making a profit. If you are the type of trader that can keep their eyes on the price, however, you just may be able to bear the brunt of One Touch trading.

It can be tempting to choose a trading type solely upon the simplicity of it or just how much money you may make. If you are planning on being a binary options trader for quite a while, however, this is not a tactic that will work. You need to carefully look at the points above to decide how to choose the right type of trade for you.

Australian binary options traders have the possibility to choose from many ASIC regulated binary options brokers that have a legit Australian license. Look here for more info.

Fundamental Concepts of Binary Options

Binary options trading has been around for a while now and is spreading in popularity throughout the world. More and more traders are joining in on this trading form as they are able to notice all of the unique advantages offered to them.

While this type of trading is ideal for entry level traders, there are certain elementary facts that you should understand about. This is the only way to ensure that your endeavor commences on the right note. In this article, you will find the fundamental concepts of binary options. It will provide you greater insight into what binary options trading has to offer:

There are Several Forms of Options

There are several options that you can utilize with each binary option trade. The most commonly used one is known as the Call/Put or High/Low option. This is when you just decide whether or not the value of a certain asset will increase or decrease within a certain time period. Call is tied with the price of an asset going up while the Put option indicates that the price will be dropping. This, however, is not all that is available.

Next in line, in terms of popularity, are one touch and no touch trades. One touch is when you decide that a certain price point will be reached by the end of the trade. No Touch is when you determine that a particular price point will not be achieved within the set time period.

Then there are boundary trades, which are also known as range trades. With this option there is a channel created between the high price point achievable and the lowest price point possible. In this scenario, you are establishing that the price of the asset will remain within these extreme boundaries.

The Trade Time Limit

The trade time limit with binary options trading is actually a common misconception. Most people simply assume that there are only short trades available with binary options. It is true that this form of trading offers some of the shortest trades. However, while short trades tend to be more popular, there are not the only ones that you can use. With binary options, short trades can be as quick as thirty seconds, with the sixty second trades being the most desirable ones.

The short trades can last anywhere from half a minute to a full day. There are longer trades as well, nonetheless. These can run from a couple of days to weeks, or even months. Traders face restricted time limits due to the brokers that they are registered with. There are some brokers that do offer traders greater flexibility when it comes to choosing their trade times.

Binary Options Bonuses

If you are comparing various binary options brokers with one another, you may have noticed one thing. This is that many of them use bonuses as a sales tactic.

What Do Binary Options Bonuses Really Mean for You?

Now, these bonuses vary from one another but they do certain things in common. For instance, there is no denying that they all appear to be quite alluring. It can be quite easy to want to join a binary options broker that is offering an incredibly generous bonus. Nonetheless, you need to ask yourself the question what do binary options bonuses really mean for you? This article tackles the relevant elements for you:

Types of Bonuses

Now, the bonuses themselves can come in different forms. This typically depends on what a particular broker is willing to offer in exchange for your registration. One of the most common types is the welcome bonus. You receive this when you first sign up with the broker. It could be in the form of money to trade with or just an amount added to your account. This bonus is no longer applicable once you have become a regular trader with that broker.

Just as popular is the deposit bonus. This is more of a continuous reward. Each time you deposit a certain amount of money in your account, the broker will provide you with a percentage of money. The benefit of this, as you can imagine, is that you get to continue receiving additional money.

Then you have the risk free trading bonus. This is not a tactic that is widely adopted. Even if it is, it is usually reserved for account holders with high deposit minimums. Nonetheless, it is an enticing offer as it allows you to make a certain amount of trades completely risk free. This means that even if the trade ends up out of the money, you still get all of your money back.

There are some brokers that allow you to register with them for free – no deposit required. Instead, you can place the money into your account only when you wish to start trading. On occasion, a broker will provide you with an incentive if you can prove that you have referred another trader to that site.

The Hidden Details

What many traders fail to realize is that every bonus has its own set of terms and conditions. Essentially, they all come with a catch of their own. Now these special circumstances depend on the broker that you are signing up with.

A shared trait, however, is that you are not simply allowed to withdraw the bonus whenever you feel like it. You typically have to conduct a certain number of trades and have a specific amount of money in your account before you can withdraw this money. On certain occasions, you may not be able to withdraw the money at all. Instead, you may be required to use it to place trades with.

It is quite common to find a set of terms and conditions just for the bonuses. It is important to thoroughly examine and understand all of the strings that may come attached with the bonus. This is the best way to avoid any confusion or any unpleasantness later on.

Should You Take the Bonus?

One thing that you need to understand is that you are not obligated to agree to bonus. If you wish to, you can waive the bonus. Now, it is completely up to you if you want to do this. You will need to weigh the pros and cons involved with such a decision. It also depends on the type of bonus that is being offered and the restrictions that places on you.

This should help you to understand what binary options really mean for you. As a result, you should be better equipped to determine whether it is right for you or not.

Australian Binary Options Assets

One of the first things that you need to do when start with binary options trading is to decide on an asset. Of all of the things that you can do, selecting the trading assets compatible with you, offers the highest chance of success for you.

Why? Well, each asset has its nuances that need to be studied and understood in order to master the subject. Each trading asset is quite different from one another and they are not all well-suited to every trader. Here is a guide to find the ones that are best for you:

You Don’t Have to Choose Just One

The first thing you should be aware of is that you don’t have to rely on just one asset. In fact, doing so could put you at greater risk because you stand to lose a lot of money if the market turns. Most experts would advise you to diversify your assets.

This means choosing assets that tend to perform in opposite ways during the same conditions. Imagine, for instance that stocks in a particular industry are plummeting. Well, then a good way to offset any losses you may make here is by placing trades with cash. In such a situation, it is unlikely that there will be any devaluation of any currencies. At the same time, you should avoid stretching yourself too thin. It is better to be the master of few than a jack of all trades.

Start with a Broad Range, Then Narrow Down Options

This is great advice for those who have never traded anything before. Since you don’t have a particular background to rely upon, you may not know what you feel comfortable with just yet. Now, the worst thing that you can do is to narrow down your options immediately.

If you are new to the world of trading, indices may seem incredibly boring while commodities may seem more your style. This could prove to be true. However, it is best to give every asset a fair evaluation. This doesn’t mean that you have to place trades on all of them. Rather, spend time trying to understand what each of them entails. You may actually find that an asset that you may have previously dismissed will turn out to be your forte. Make sure that your selecting – or disregarding – the asset for the right reasons.

Consider Your Trade Win Rate

Not all assets have the same payout rate. For various reasons, a broker may assign a higher rate to one asset over the other. Therefore, a good way to determine if an asset is a fit for you is to look at your win rate. For instance, how much of the time do you win your trades?

Let’s imagine for a moment that your trade rate is average at best, perhaps dipping lower sometimes. In this case, you should consider assets with higher payouts. This way, when you do win a trade, you get to make more money. This will help to balance out your losses a little better.

Look at the Time Zones

If you want to get into currencies, then you have nothing to be concerned with – currencies are traded on numerous platforms around the world. This means that regardless of what time it is at home, there is a platform somewhere in the world that is open.

The story is a little different if you want to trade stocks, however. This is because stocks tend to trade only on their local platforms. Now, the companies that you want to place trades on, may be located in a different country, or even continent. Therefore, you will probably have to be up at unorthodox times in order to be able to place trades.

These are some of the tips that you can follow in selecting the trading assets compatible with you. You will have a greater chance at making the right decision.

Binary Options Account Types

Some brokers just have one trading account available to you. You simply have to deposit the minimum amount of money required and you can begin trading after registration. It is also quite common to see brokers that offer a variety of account types to their traders.

These packages start with the most basic amenities and then move onto more luxurious options. With all of these choices available to you, it can be a little difficult to determine which one is best for you and your trading style. This article will help you with examining the right account type for you:

What is Your Budget?

Perhaps the most important question to ask yourself is just how much you can afford. The basic accounts often cost between $250 and $500, although there may be ones with lower minimums. The higher ones can often cost tens of thousands of dollars. What you need to remember about this minimum deposit is that this is the amount that you will require every time that you wish to fund your account. It is not just a onetime occurrence.

Therefore, you are going to require this specific sum, each time that you want to make a deposit. If you are going to be making frequent trades or are on a limited budget, it is best to stay within your limits. Otherwise, you may finding yourself falling short when it comes time to replenish your account.

What Are Your Requirements?

The next thing that you should consider is just what you are looking to get from your account type. Now, if you are a beginner, it is quite probable that you are just looking for an account that will allow you to place money on trades.

This is typically also true for individuals who do not engage in trading quite often. Here, the bare minimum will do. Expert traders, on the other hand, may need more to work with. As your trading style will be quite different, you may want other tools at your disposal. Now, these are usually not available with more basic packages. In this case, you find the more premium packages a better fit for your trading.

What is the Value of the Account?

In addition to questioning your own requirements, you should look at just what the accounts are offering you. It is a sense of getting what you have paid for. There are instances where you might find that getting a more expensive account is justified.

This is especially if the bonuses, payout rates, and other features are quite significant. For example, there are some accounts that allow you to make a certain number of trades without any fear of losing your money. Even if the trades end up out of the money, you get your initial investment back. There are other accounts that let you withdraw money from your account as many times as you want without charging you any fees. Therefore, you should weigh the cost of the account against what you are getting in return.

The Safest Route

If you are a new trader or don’t planning on trading too often, you may wander what you should start with. It is probably a good idea to start with the account that requires the lowest deposit. Remember, you are able to add as much money to this account as you want. While it is true that you will not have access to some of the amenities available with other accounts, it is a good place to start.

These questions will help with examining the right account type for you. Once you have answered all of them, you will be one step closer to making the right decision.

 

Binary Options Robots Australia

You may have heard about binary options robots, which are a form of auto trading. It often seems that every time you visit a website related to binary options, there is a business advertising their software.

Are Binary Options Robots Legitimate?

Of course, all of these promise excellent results and you don’t have to involve yourself with the trading either. As with anything that appears to be too good to be true, you may be wondering are binary options legitimate? This article tackles this very question, allowing you to determine whether or not this the right avenue for you:

Not All Robots are Scams

The first thing that you need to know that not all of these robots are fraudulent. Yes, there are a large number of fake providers but there are also ones that are legitimate. The difficulty, as you can imagine, is to distinguish the good from the bad. You are required to download the software onto your computer and to allow it to access your trading account. You will then need to adjust the settings according to your preferences.

After this, the software will begin trading for you. You should also remember that just because a robot is authentic, doesn’t mean that the software is very sophisticated. This is something else that you will need to watch out for as well.

The Advantages of Binary Options Robots

Now, the next thing that you may be concerned with is if there are any benefits to using binary options robots. This type of software is typically touted at those just starting out with this type of trading. They don’t have a lot of skill or knowledge at their disposal so they are looking for some simple options. The robots provide them with this avenue, allowing them to simply sit back as the trades are made for them. This is also seen as a good solution for traders who don’t have a lot of time on their hands. Instead of having to constantly monitor the markets or pay attention to charts, the software places trades at appropriate moments.

Is It Worth It?

While there are free robots available, you will need to pay a monthly fee for most of these software. Also, you will only be able to use brokers that are compatible with that particular type of robot as well. Despite what is advertised, it is quite likely that a robot can be just as wrong as you. This is because the robots rely on signals. Once they receive one that is relevant to your trade settings, they will place the trade.

Therefore, there is no guarantee that they will be any more successful at the trade than if you were following the signal. Of course, the downside here is that the robot will just follow the signal. The software will not stop to consider whether or not the signal is a reliable one.

Is It Right for You?

As mentioned, this is often see as a great opportunity for novice traders. However, it is a very passive method of trading. As a result, you don’t really end up learning anything about placing binary options trades.

You just let the software do it for you. On top of that, there is also no guarantee about the profits that you will make. Therefore, you will need to determine what you expect to get out of binary options trading and if the robots help you achieve this goal. While the robots may cut down on how much effort you have to expend, it will not aid you in gaining any skills.

This should answer the question, are binary options legitimate. With the information provided here you should also be able to figure out whether it is something you should invest in.

Binary Options vs. Traditional Forms of Trading

With trading and investment, it is all about choosing the avenue that guarantees you the largest amount of success. This is why you need to compare the various types of trading available with one another to determine which one is most profitable.

In this vein, it is interesting to determine how binary options vs. traditional forms of trading will look when evaluated against each other. Will more differences or similarities emerge? Is it really better for you to stick with binary options trading? Find out the answers below:

1) The Way the Trades Occur

Let’s first take a look at the way that the trades occur. With binary options trading, you simply determine whether the price level of an asset will either rise or fall with a set period of time. Depending on the conclusion that you have reached, you will either set a Call/Put, One Touch/No Touch, or Boundary condition to your trade. Then it is a matter of waiting for the trade to expire and then seeing whether you were right or wrong.

With other types of trading, it is about getting involved in an asset when the price point is relatively low. Then, you will need to wait until an opportune moment when the asset is worth more than what you paid for it. Then, you will sell to someone else and collect a profit.

With binary options, at no point do you own any of the assets. You are merely placing a trade in regards to the price movement. There is no selling and buying involved. The opposite is true for other forms of trading. Whether you are involved with stocks or currencies, it is the same. You physically own the asset (or part of it) for as long as you want.

2) The Market Entry Point

One clear way that binary options offers greater advantages to traders is when it trade. In a nutshell, as long as you are over the age of 18 and the country that you are residing in, allows it you can trade with binary options.

This is because of how little money you require to get started with it. You can find brokers that charge fees as low as $10 to sign up with them. They also don’t charge any additional fees and the only money that you are responsible for is what you place on trades. With other types of trading, you need a lot more money to even get your foot in the door. Even if a particular avenue doesn’t require much capital, there is always the issue of broker’s fees. You can end up paying more for these expenses than you actually make with a trade.

3) Certainty of Loss and Profit

When you are trading stocks, commodities, or currencies, you can never be sure of how much you are going to profit or lose. It all depends on the conditions at play when you decide to sell your asset. So, if the price point is higher than when you bought it, you make a profit. If the price is lower, you have lost on that particular trade. There is no such uncertainty when it comes to binary options. This is because everything is set from the very beginning. After you have chosen an asset, an option, and an expiry time, your broker will give you a payout rate. This can be anywhere from 65 percent to 90 percent or more. This what you will make if the trade ends in your favor. If it does not, you will have lost all of the money in one swift go.

So this is what you need to know about binary options vs. traditional forms of trading. As you can see, the differences outnumber the similarities.