SEC and CFTC Binary Options Alert

Posted by Deb | Binary Options,Guest Post | Sunday 21 July 2013 10:46 pm

The fact is simple; trading binary options is profitable and risky. You know your exposure to loss on the on-set of the trade. This has given binary option trading a boost in its popularity. The simplicity of entering binary options trades and making money out of it has provided many people a respite from grueling economic times.

The binary options market has expanded so much in the recent past years. People from an average economy class to big organizations are involved in trading binary options. However, according to a latest SEC and CFTC binary options alert, many innocent investors have become a victim of corrupt business practices. This alert has detailed every possible type of fraud that a newbie investor can become a victim of; such as a platform that is designed, to run against you and providing you wrong signals, refusal or delay in crediting the profits that you make on your trades and sometimes even identity theft.

The binary options alert from SEC and CFTC also highlights certain regulatory requirements that some platforms are failing to comply with. In the alert, SEC states that because of non-compliance with registration requirements such as registering as ‘Futures Commission Merchant’ or ‘Registered Broker-dealers’, entering a trade becomes illegal. This could result in a legal action against your broker, endangering your trades.

The alert also highlights the importance of carefully researching and investigating the platform that you are about to choose. In this alert, investors have been provided with tips on how to ascertain that their chosen platform is clean. First off, you should check if the binary options trading platform has registered with the SEC. Secondly check if the platform has registered itself as an exchange. Thirdly, check if the platform is designated as a contract market. The (SEC and CFTC) alert provides investors with sources from which you can ascertain the required information. The sources are FINRA BrokerCheck, BASIC Search, CFTC website, EDGAR and SEC website.

You should be very careful with whom you place your hard earned money and sensitive information. Nobody wants his credit card information get stolen and maliciously used. With this alert at hand, you now know what exact legal notorieties you should be looking for while investigating a particular options company and its platform. The binary options market is relatively a new phenomenon, and regulators will take time to make trading with them securer. Until that time, you should keep yourself updated with such binary options alerts.

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How To Control Your Risks In Binary Options Trading

Posted by Deb | Binary Options,Guest Post | Monday 8 July 2013 8:45 pm

You can get plenty of advice on making investments. But, arguably, the best one has to come from the world’s most successful investor, Warren Buffet: “Rule No. 1: Never lose money. Rule No. 2: Don’t forget rule No. 1.” It is pretty general but it is the kind of statement you want to be reminded of every time you are itching to do a risky trade. When you are venturing into binary options, know that there are risks to be had if you are not well prepared for the market.

 

Growing GraphWhen you are just starting out, it pays to invest first in knowledge before you actually get to jump into trading. Any successful investor knows that you should master the basics. Learn the lingo or relevant terminologies, as in “put” (when you presume the value of an asset will be lower than when it was bought) and “call” (when you presume the value of an asset will be higher than when it was bought). Learn about trading platforms and which ones will be easy to use and come with comprehensive features. Learn about the different trading strategies. Mastering the basics will let you maximize your win rates and minimize your losses.

 

In addition to learning the basics in binary options trading, you should try to practice your newfound knowledge by opening a demo account. Demo accounts are ideal for beginner traders because they can be great training tools. You receive practice funds, which are not real money, and you get to participate in the market, applying the strategies you have learned for a set period. When you open a demo account, make sure that you do not have to pay a deposit, as most brokers will offer them for free. Also, you need to clarify whether the broker you are opening a demo account with will obligate you to sign up for a live account.

 

Trading on MoneyFinally, get trade analysis from reliable and credible sources. Trading analyses can help you place your trades on any asset — from stocks to indices —to favorable outcomes. You will want to go with sources that combine technical with fundamental analysis in order to come up with sound projections on certain assets. You also want to go with sources that rely on actual analysts, as opposed to robots.

 

Any financial investment can be filled with risks. The key is to control those risks so that you do not end up losing money in the process. With binary options, remember to master the basics. Try to get a practice run with a demo account. And obtain simple yet good analysis from good sources.

 

Author Bio

Sarah Miller – a freelance writer and blogger who is currently writing in behalf of http://www.binaryoptionsexperts.com.  She is a business consultant by profession and a content creator, writer and blogger by passion. Having been exposed to the different aspects and faces of businesses, she frequently does research on useful information regarding the different methods and techniques to further improve business marketing, sales, performance and shares her passion of business management through blog/content writing.


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Binary options Brokers

Posted by Deb | Binary Options,Guest Post | Tuesday 28 August 2012 3:37 pm

The concept of Binary options trading has evolved a lot during the last 2 years. Many forex brokers started offering a binary options service. In fact the binary options are quite easy and very straightforward way of trading forex and other commodities. All you have to do is to predict the price movement, will it go up or down for a certain period of time. If you guessed right you immediately win up to 85% and if not you lose the entire investment. There is no stress of waiting the price feed, everything is clear and immediate. You can see a list of binary options brokers in order to choose the best one.
After you read this article please let me know if you found it useful and interesting for you? How it contributed to your trading experience?

Binary options brokers

Because binary options became so popular during the last 2 years, CySEC (the commission of financial supervision in Cyprus) decided to regulate those entities. The project is still in a development process and one can hardly predict what will be the consequences of that decision. In fact there are some SCAM brokers among them and it is good to know that companies must be chose carefully.

The brokers offer different conditions in terms of minimum account opening amount and maximum position size. Some brokers may not accept the risk of opening too big position against you because this may result in loss for the broker. Also, it is a n interesting fact that some brokers offer back loss of 10 to 15% which means that if you guess wrong a small portion of your investment is returned to your account as a compensation.

Types of binary options

Cash-or-nothing binary options – It is obvious that this type of options offer the opportunity of winning either fixed cash amount or nothing against your initial investment. The strike price is determined, i.e the price at which traders enter the market. As soon as this is done an expiry time is set and when the option expires the investor either wins the cash or loses his or her investment. In the case that the prediction about the price was right the binary options broker has to pay the trader a return which is predetermined and fixed before entering the trade. Conversely, the trader loses all the funds blocked into the trade if his or her prediction was not correct.

Asset-or-nothing binary options – The principle of trading this type of binary options is entirely the same as the Cash or nothing binary options. The only difference here is that the price of the asset is paid out as return of the investment. In this case the trader wins or loses the value of the asset on which the option is based according to his or her prediction of the price direction.

One-touch binary options – These options work differently from the Cash or nothing and Asset or nothing binary options. Here the trader bets that the price of an option will “touch” or reach the price. In this case the expiry time is determined by the chart and all can happen in 1 second or 1 week. Of course, there is a maximum exipy time set by the broker so you cannot wait for ages.

No-touch binary options – those are the same as One-touch but here traders hope that the price will never reach the defined level. It can be used for hedging with One-touch, although it is quite complex.

Double-one-touch and Double-no-touch binary options – these exotic types of options increases the variations you might have with options tradind. As the name suggests, double touch options are simply instrumenst that can bring you return if the price is touched twice. To predict such movement it is needed to have a quite good understanding of the market you are investing. It might be an interesting opportunity of trading news with Double touch binary options.

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Binary Trading With AnyOptions

Posted by Deb | Binary Options | Friday 4 February 2011 12:38 am

I am not an expert on options on trading, as you know I am only an amateur trying to trade futures. Lately I was asked by a representative of Anyoptions to try also binary options. I am not sure I have the time, but anyway I read the following article which sounds interesting, so I am bringing it here.

What are binary options?

Binary options are an innovative way of profiting from the financial markets, without needing a trading or financial background. Deriving its structure from the term binary – zero or one – a binary option is an option which is bought whose outcome is known from the start and whose result is all or nothing (theoretically – though there are some exceptions as demonstrated on (www.anyoption.com).

A binary option trade is like saying: “I predict that at the end of the day my chosen asset will be higher that it currently is. If I’m right, then I’ll get the payout determined by my online trading platform. If I’m wrong, then I will receive nothing, but I will never be asked for more money”.

 

 

How does a binary option trade work?

The components of a binary option trade are simple yet with enough variety to enable a personalized trade. The first item to be selected is the asset itself – this could be a currency pair/forex (e.g. USD/EUR), stock (e.g. Apple), commodity (e.g. Gold) or index (e.g. Nasdaq). On the anyoption™ platform there are more than 60 assets on offer covering the American, European, Asian and Middle Eastern markets – something for everyone to choose from. Next, it’s time to select the expiry time. Depending on the platform chosen this could be as near as the end of the next hour, or the end of the day, or week, with the anyoption™ platform offering monthly expiries too. The third step is to decide on the direction in which the asset is predicted to move – UP or DOWN, otherwise known as CALL or PUT. Once the option is bought, the price that the asset is bought at is known as the strike price.

 

CALL – a call option is bought when it is predicted that by the expiry time the price of the asset will be higher than its strike price.PUT – a put option is bought when it is predicted that by the expiry time the price of the asset will be lower than its strike price.

What is a binary option’s outcome?

Once the binary option has been purchased, the investor must wait until the expiry time to discover whether his prediction was correct. A correct binary option trade is known as being ‘in the money’ and an incorrect trade is known as being ‘out of the money’.

Hence, a CALL option which expires above its strike price is ‘in the money’ and one which expires below its strike price is ‘out of the money’. Conversely, a PUT option which expires below its strike price is ‘in the money’ and one which expires above its strike price is ‘out of the money’.

Now for the profits – the binary option’s return rate! ‘In the money’ options will receive the percentage payout offered when buying the option. This will change depending on the platform. On anyoption™ this is between 65-71%. As per their name – binary options – ‘out of the money’ trades should result in a loss of the investment. However some websites offer percent refunds for these trades; with anyoption™ offering an industry high 15% refund.

The simplicity of binary options means that a trader does not need in-depth knowledge or experience in the financial markets. Reading the papers and being aware of his surroundings can be enough to gain insight on the likely direction of assets and to bring about a successful and highly profitable binary option trade.

What assets are available?

The number of underlying assets available when choosing your binary option trading platform is a huge attraction to a site. The greater the variety: the more able an investor is to create a personal trade; the more possible it becomes to react to and profit from financial news; and the more enjoyable the trading experience. This is seen on the anyoption™’s platform which offers over 60 underlying assets, an industry record.

There are four types of underlying assets on which a binary option can be purchased: forex, indices, stocks and commodities.

Forex binary options/currency binary options: these are also known as currency pairs since they are made up of 2 currencies e.g. USD/EUR. Forex, or foreign exchange, reflects how much of one currency is needed to purchase a unit the other currency. The first currency (in this case the USD) is known as the base currency and the second one the quote currency. The stronger the base currency, the higher the number of the quote currency (i.e. it will take more Euros to buy one USD). This is vital for international trade and investment. It allows two countries who normally trade in their own currencies, to trade between themselves.

Stock binary options: stock shows what a company is worth and it is represented in shares. The beauty of stock binary options is that an investor is not obliged to buy the shares themselves in order to benefit from the activity of a company. Hence stock binary option trading allows an investor to trade, with fewer funds, on a company’s performance. anyoption™ has a wide variety of stock assets available covering the USA and Europe.

Index binary options: a group of several stocks is known as an index. It enables an investor to gain exposure to a wider section of the market in one single trade. Since it is the performance of several companies which affects the index, trading index binary options is generally a more reliable investment, however they are interesting since external factors can influence their movement. On the anyoption™ platform an investor has a wide choice of indices from the USA, Europe, Americas, Asia and the Middle East.

Commodity binary options: a good which falls under the word commodity is that which is easily interchangeable with goods from another producer. On the anyoption™ platform this includes oil, gold, silver and copper.

 

Advantages of trading binary options

Understanding how to trade is always important before an investor begins to invest. Once he discovers the advantages that binary options trading offers, it will inevitably enhance the enjoyment of this type of investment.

Here are some of the benefits associated with binary option trading:

Controlled risk – when a binary option is bought, the percentage payout is already known, both for in the money and out of the money outcomes. The risk is therefore controlled since an investor knows exactly how much he risks losing – he will never be asked for more money once the binary option expires.

Profitability – since it is the change in direction which is important and not the magnitude change, a larger profit can be obtained from a smaller investment. The payout, for example 70%, is guaranteed no matter how large or small the investment.

Simplicity – though research is always needed before an investment is made, binary options are much more simple than their counterparts since only a correct direction change is needed, rather than a large magnitude change.

Accessibility – binary option trading opens up otherwise expensive markets to the general public. No longer restricted by high share prices or rising commodity costs, everyone can invest in a binary option, with the investment level that they choose, with the same payout amount offered equally to each investor.

Flexibility – the anyoption™ platform is available internationally and in 5 different languages. With the introduction of One Touch options which can be bought over the weekends when the markets are closed, binary options are a 365 day a year product. Additionally, the availability of over 60 forex, stocks, index and commodity options with the choice 4 expiry times, makes binary option trading on the anyoption™ platform flexible and personable.

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