Binary Options | an Easy Investment That Beats Fx Trading
The way these trades are set up are an investor will go to a trading platform where these securities are being offered. Given the relatively small size of the present market only a select few options are offered – and then only on the most recognizable, most highly liquid stocks (think Google, Microsoft, VW, BMW, GE), indices (Nasdaq) and forex cross rates (GBP/USD, USD/YEN, etc). Investing in well known items like these is another factor making binary options an easy investment to understand. These days even some popular commodities are available on binary options exchanges.
Another really nice feature about working with binary options is that investors buy them in quantities similar to the way they would buy mutual funds — i.e. in exact dollar amounts. That makes it an easy investment to fit into a budget — no guess work as to what the settlement amount of a trade will be. Want to invest a hundred dollars? Invest a hundred dollars. No guessing, no commission to figure, no spread. Exact dollar investing.
Lastly I mentioned investing just a hundred dollars. Investing such a small amount in other securities simply wouldn’t make sense due to the commissions and spreads making such a small investment size impossible to make profitable. Not so in the case of binaries. Because there is no commission or spread, investments (like no load mutual funds) have no “transactional overhead” associated with them.
- So in summary binary options:
- Have a fixed yield
- Trade in fixed dollar amounts
- Expire hourly or daily
- Are cash only investments
- Limit risk to the amount of investment
- Pay yields typically in excess of 60%
- Can be purchased with as little as $100
- Are available on only the best known, most popular investments
- Trade with no spread or commission
- Are “fire and forget” – make a trade and then walk away
- Do NOT require understanding of complex margin rules
So as you can see there are a lot of reasons investors find working with binary options contracts better than fx trading. By narrowing the focus of the investment to the outcome of the movement of the security, the studious investor is taking the greatest advantage of the research they have done. It never ceases to amaze me how much time and effort a day trader will put into researching a stock or a market or technical charts only to get mired in the details of margin requirements, yield computations, and transaction costs.
Traders are supposed to be experts in stock prices / company valuations. All that other stuff is for the accountants and brokers’ benefit. Why would anyone want to bother with that hassle? The truth is people don’t bother with the fine print and watch their investment capital get frittered away by fees, commissions, and interest.
On the other hand day trading binary options is an easy investment because it is a no commission, no spread, virtually no math way to invest. Learn more in our strategy and tips posts. You decide what’s better for you.
