option binary

Apr 07

Option binary

Introduction to Binary Options Trading option binary.

วิดีโอ option binary



So, smaller trading costs on low time frames are the obvious benefit of trading binary options. With all the side benefits of low time frames, such as more data for backtests, and shorter drawdown periods in live trading. But how can we take advantage of that? There are three problems to solve.

Here are the top 10 option concepts you should understand before making your first real trade: What is a Call? What is a Put? Option Expiration Strike Price Understanding Option Pricing Best Discount Option Brokers Buying A Call Option Making Money with Options Exercising Options Writing Call Options

วันนี้ออนไลน์มากที่สุด: 45. ออนไลน์มากที่สุด: 172 (มีนาคม 16, 2017, 09:50:00 AM)



อ่านเพิ่มเติมเกี่ยวกับ option binary

We’re getting more and more coding contracts for binary option strategies. Which gives us a slightly bad conscience, since those options are widely understood as a scheme to separate naive traders from their money. And their brokers make indeed no good impression at first look. Some are regulated in Cyprus under a fake address, others are not regulated at all. They spread fabricated stories about huge profits with robots or EAs. They are said to manipulate their price curves for preventing you from winning. And if you still do, some refuse to pay out, and eventually disappear without a trace (but with your money). That’s the stories you hear about binary options brokers. Are binary options nothing but scam? Or do they offer a hidden opportunity that even their brokers are often not aware of?

Binary options, in their most common form, are very different to real options. They are a bet that the price of an asset will rise or fall within a given time frame. If you win the bet, the broker pays your stake multiplied with a win payout factor in the 75%..95% range. If you lose, you pay the stake minus a possible loss payout. You’re trading not against the market, but against the broker. The broker needs you to lose, otherwise he would not make any profit. Even if he really pays out your wins, and even if he does not manipulate the price curve, he can still control your profit with his payout factors. So it seems that even if you had a winning system, the broker would just reduce the payout for making sure that you lose in the long run.

However this conclusion is a fallacy. It can in fact be of advantage for the broker to offer a payout that allows you to win, as long as most other traders still lose. A broker has not the freedom of arbitrarily reducing the payout. He’s competing with other brokers.

But why would you want to trade binary options anyway, when you also can trade serious instruments instead? Aside from tax advantages in some countries, there is one single compelling reason that might make the experiment worthwhile. Profit and trading cost of a binary option are independent of the time frame. So you can trade on very short time frames, which would be difficult, if not impossible for retail traders with other financial instruments. You can find a discussion of this problem in the Scalping article.

Binary scalping math

The required minimum win rate for binary trading can be calculated from the broker’s win and loss payout:

W = required win rate for break even Pl = Loss payout Pw = Win payout

With 85% win payout and no loss payout, you need a win rate of

54% win rate seem to be manageable on short time frames. The transaction costs of a non-binary, conventional broker would require a much higher win rate, as in the following graph from the Scalping article:

You had to win almost 80% of five-minutes trades – impossible for a trading system under normal conditions unless you enforce that win rate with some tricks, which however won’t help getting in the profit zone.

So, smaller trading costs on low time frames are the obvious benefit of trading binary options. With all the side benefits of low time frames, such as more data for backtests, and shorter drawdown periods in live trading. But how can we take advantage of that? There are three problems to solve.

Three steps to potential binary profit

Source: http://www.financial-hacker.com/binary-options-scam-or-opportunity/


option binary