All trading is extremely risky if you don’t know what you’re doing. In fact, you can potentially lose all your money just minutes after you start trading if you are not expertly educated in the aspects required for success.
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New York, NY (PRWEB) August 31, 2012
The Binary Options Experts, one of the most prominent consultancy firms providing assistance to investors across the globe, has just released an infographic to help online investors and day traders understand binary options, a new form of investment strategy that is fast becoming popular in today’s tech-driven investment market.
The infographic begins by defining binary options as a type of investment vehicle used by traders to speculate on the future value of an asset. According to binary options trading experts from the company, there are only two possible outcomes in binary options trading: either the asset will rise in value or its value will drop within a given time period, giving investors a predetermined profit (customarily between 60%-90% ROI) or a predetermined loss within the chosen timeframe.
Consultants from The Binary Options Experts state that this time-limited quality is one of the three factors that distinguishes binary options trading from regular or so-called “vanilla” options. The other qualities are payout (profit potential) and execution.
“There are three main points of difference between Binary Options and vanilla: expiry time, payout, and execution. Binary Options have short-term multiple expiry times which means investors can make an instant profit and be more flexible in their options investments,” explain company consultants.
“On the other hand, payout from vanilla options depends on the difference between the price of the instrument and the price of the option when it expires. With Binary Options, the two prices are set from the start, which means that investors are aware of the risk before placing their trade. Execution for binary options and vanilla options trading differ in that the former may only be executed upon expiry, while the latter may be executed at any time until the trade expires,” company experts add.
The infographic also enlightens investors on how to trade binary options. According to the company’s expert consultants, investors must first choose an underlying asset. This underlying asset gives an option its value, and it may be a stock, commodity, index or foreign exchange. Once an investor has chosen an underlying asset, he or she is then required to set an expiry time by which the contract will end, and this may be as short as a few minutes, hours or as long as a few months. Traders can earn profit by choosing either Call or Put Options on an instrument once the contract expires in the direction speculated.
Lastly, the infographic gives information regarding the advantages of binary or digital options, which include controlled risk, greater opportunities, high profitability, simplicity and accessibility. However, expert consultants from The Binary Expert Options warn that although this form of trading is simple and highly profitable, it could still be a risky venture for people who are not educated in the specialized skills of trading binary options, the mental, emotional and business planning aspects needed to consistently extract large profits from the binary options trading markets
“All trading is extremely risky if you don’t know what you’re doing. In fact, you can potentially lose all your money just minutes after you start trading if you are not expertly educated in the aspects required for success.”
Concern for public welfare and an aim to minimize the risk that comes with having little information has prompted the company to create an easy-to-understand infographic, according to The Binary Options Experts.
Individuals who are interested in learning more about binary options can view the infographic on the company’s website here.