Four Things Smart People Have WRONG About Binary Options
1) WRONG to think Binary Options are complicated
Markets can only do three things… go up, go down, or go sideways. Binary options can potentially profit from where a market goes or even where it doesn’t… Either the underlying market finishes above or below the strike at expiration to determine value of $100 or $0… couldn’t be more simple than that.
2) WRONG to think Binary Options are gambling
A key benefit of using options is better probability control. An outright buy or sell investment has a 50/50 chance of that market rising or falling compared to option odds that can be chosen to based on probability. Buying out of the money options have lower probability of success than the in the money options and that is why they cost less. Balance the reward to risk to fit your risk profile and trading personality knowing the Binary Option maximum payoff is $100 and worst case scenario is $0.
3) WRONG to think Binary Options are risky
Binary Options have absolutely limited risk so risk control is automatically built in. The worst thing that can happen is an finishing with zero dollar value. That is the maximum loss no matter what happens in the market. Binary Options are no different than other investment vehicles in the fact that allocation and money management are critical to long term success. One benefit is that the total dollars at risk on any Binary Option trade is known before entry.
4) WRONG to think Binary Options require constant attention
Binary Options fit all lifestyles from those who want to watch every tick to a arms length investor with a set it and forget it trading plan. The combination of limited risk and staying power to ride market ups and downs lets Binary Options traders focus solely on the price at expiration and not worry about the path it takes to get there.