Trading in general is a basic economic concept that includes buying and selling goods and services.
Profits from trading activities come from the compensation paid by a buyer to the seller, or the exchange of goods or services between two parties.
Trading can not only be done with people from the same country, but also globally which is called international trading
The international trade market offers more fierce competition.
This also has an impact on the creation of more competitive prices.
Binary trading is a form of stock commodity trading that is said to bring a lot of benefits.
The Covid-19 pandemic that forces workers to look for additional income, or passive income, has made binary trading an iqoptions.
In the United States itself, this trading activity is legal as long as it follows the existing regulations.
What is Binary Trading
Binary trading is a financial instrument that allows traders to profit from fluctuations in global market prices.
A trader will make speculations or guess what the price of an asset in a certain period of time.
Sounds pretty easy, right? This is what makes it a popular choice for traders who are beginners or don’t have enough skills
Even so, this type of trading is very different from traditional trading such as stocks and others.
The things that underlie the differences between them are in terms of payout, costs, risk, liquidity structure, and investment process.
In addition, in binary trading you are only speculating on the movement of asset prices, not buying assets in the market.
So, you do not have any ownership of the asset whose price has been predicted.
Generally, the assets that are predicted in binary trading activities are currencies, stock indices, commodities, to cryptocurrencies.
If your prediction is correct, the benefits of the payout that can be obtained are very diverse, ranging from the range of 60 to 90 percent.
Even so, if your prediction is wrong, then the balance that you have saved will be completely lost.
So, for example, if the payout offered in this trade is 70%, then the risk to reward ratio you get is 1:0.7.
How Binary Trading Works
There are several things you need to pay attention to before jumping into the world of binary trading. In binary trading there are three important components that make it up, including:
- Defined market or predicted asset price: You determine what asset you will predict the price of. The assets that are used as trading commodities have been mentioned previously.
- Expiration date and time: You determine the date or time when the price of an asset will reach your prediction. The predicted time range can be from 1 week to 5 minutes.
- Strike price: Component where you determine the prediction of how much an asset will cost in a specified time period.
Binary trading itself has 3 types, here are some of them.
- high-low: make a prediction whether the price of an asset will rise or fall within the specified expiration time
- one-touch: predict whether the price of an asset will touch the strike price before the expiration date and time
- range: predict the price range of an asset up to a predetermined expiration period
Types of Trading
There are several types of trading that are popularly carried out by activists in the financial world, namely:
1. Forex trading
Forex trading is trading foreign currency rates.
As we know, the value of foreign currency always fluctuates every certain time.
To trade forex, you can exchange money at a money changer directly or online by depositing a certain amount of money first.
The profit gained from forex trading depends on the exchange rate of foreign currency with the currency we want.
Forex trading is considered one of the most profitable. However, the risk is quite heavy.
2. Stock trading
Be careful not to confuse stock trading and stock investing.
Both do contain the word stock, but the concept is different.
Stock trading is the activity of buying and selling shares over a certain period of time, usually quite short.
Meanwhile, stock binary options trading signals can be summed up as a “saving” activity to gain profits from buying shares for the long term.
To trade stocks, all you have to do is sell or buy them when price fluctuations occur.
Your decision must be right to get capital gains or profit margins, especially when stock prices are soaring.
3. Trade binary
Just like other trading, binary trading activities cannot be separated from buying and selling.
However, this trade is considered very risky even though it can also produce large profits.
Usually, trading types This is found in horse racing gambling transactions or football matches.
To make this trade, we have to set a target and risk some money.
If the target is achieved, there will be big profits.
However, if you miss, you will experience a loss.
4. Trading gold
Gold trading cannot be equated with buying and selling, investing, or saving gold.
The way gold investment works is not much different from forex and stock trading, it’s just that the object being traded is gold.
Gold trading can be done through a broker.
It is important to monitor the price of the US dollar when choosing this type of trade. The reason is, fluctuations in gold prices are strongly influenced by the value of the dollar and the economic conditions of the United States.
5. Bitcoin trading
Since its emergence some time ago, bitcoin trading is one of the newest trading alternatives.
The object in this type of trading is of course bitcoin.
Purchase of bitcoin can be done in rupiah currency.
Don’t worry, to be able to trade bitcoin, we don’t always need a large capital.
Most importantly, carefully monitor the rise and fall of bitcoin prices in order to make the right decisions.