Benefits of Nadex Spreads

 

Buy Time and Protection

A Nadex spread trades the movement of price between two levels. You can profit in rising and falling markets with a guaranteed limit on your risk.

That’s the key benefit of Nadex spreads. You can ride out the drawdowns while you wait for the market to move in your favor. You don’t expose yourself to unlimited risk or worry about being stopped out. 

You can buy time to be right and protection against being wrong.

Protection Without Getting Stopped Out

With Nadex spreads, you get the risk protection of a stop loss, without slippage and without being taken out before you want to exit.

If the underlying market price goes below the floor of the range, the spread does not keep losing money. You know your maximum possible risk up front when you place the trade.

This way, you can focus on your strategy.

 

Stay in the Trade Until You Decide to Exit

Because the built-in floor limits your maximum loss, you don’t need a stop loss. This also means you cannot get stopped out.

Instead, you can stay in the trade and wait for the market to turn back in your direction. Or you can exit with no more than the maximum loss you decided on. And of course, if you're already profiting, or you want to take a smaller loss than the maximum, you can always exit the trade before expiration.

Tick by Tick Correlation

Unlike binary options, which have an all-or-nothing payout at expiration, Nadex spreads move with the underlying. When the market moves up or down, the spread price moves in close correlation.

Nadex spreads are an innovation with unique benefits. They offer the same price action as conventional markets. But their built-in floor and ceiling mean that, while you can’t expect “unlimited profit potential,” you have risk protection that, unlike stop-loss orders, gives you staying power.