In the exciting world of finance, Binary Options Investments have gained popularity as a unique form of investment.
And I say this, not because I have time in this system, I say this because I spent a few days researching this method of earnings, and I am constantly looking for options to generate income online safely and profitably.
I dedicated myself for a while to investigate this, and I think I already have a little knowledge to talk about it, so if you are looking to understand what this concept is about and how it works, I will explain it in this new post.
(This will be an informational post only and not a practical one).
In my post I will tell you a little bit about the basics of Binary Options in a simple way, so you can understand its essence.
What are Binary Options?
To explain it in an easy way for everyone, and this is how I understand it hahaha, Binary Options are a type of investment that consists in predicting the movement of the price of an asset in a certain period of time, this can vary either in 1 minute, 5 minutes or more, of course, according to what I have seen, the longer the time the profits obtained are lower so the risk is lower.
But in less time the profits are higher, but the risk is more latent at that moment.
Unlike other investment methods, here you do not acquire the asset itself, but you make a prediction about whether the price of the asset will increase or decrease in a given period, then if the prediction is correct, you are already earning money in a very short time, of course all this requires a deeper study to make this type of predictions of binary operations.
The Simplicity of Trading
One of the most attractive characteristics of Binary Options is their simplicity, this is what captivated me and led me to investigate more about the subject.
I even learned that this is the easiest way to start, because if you want to start in #Crypto #Trading it is necessary to have a previous knowledge, so let's say that with Binary Options you can learn some things like an initial school or something like that.
When you invest in binary options, you only have two possible outcomes: "in the money" if your prediction is correct, which gives you a fixed profit, or "out of the money" if your prediction is wrong, resulting in a loss which is usually a fixed amount of your investment.
That is to say that if you place your prediction value over 10$ and it fails your loss will be only 10$, but this could be solved by opening a second operation with an amount of 20$ in order to recover the previous prediction that you had lost, it sounds very easy, but in the same way it requires to learn more in depth all this.
Diversity of Underlying Assets
Binary options are not limited to a single type of asset, just like #Trading in Cryptos, example: In #Binance you can find different pairs of Cryptos to trade as:
- BTC/USDT
- HIVE/USDT
- BNB/USDT
And many more, because this is also something similar in Binary Options, you can invest in a variety of financial instruments, such as currencies (forex), stocks, commodities and stock indexes, but this depends a lot on the #Broker you are using.
For those who don't know: A broker is an entity or company that facilitates the buying and selling of financial assets on behalf of investors. It acts as a bridge between investors and markets, allowing investors to access a variety of financial instruments and execute transactions according to their decisions and strategies.
I think this was the first thing I had to explain in my post hahaha, but I really forgot it until this point that I talk about it, but there you have a little bit about what is a #Broker, as it is important so you can understand my explanation.
Continuing with the theme of diversity, this allows us to choose the assets that you feel most comfortable with and that best suit your investment strategy.
Expiration Periods
Each binary option has a predetermined expiration time, which can vary from minutes to hours to days, and this is what I was talking about at the beginning of this post.
This means that your prediction must be correct within a specific period. This short-term structure can be beneficial for those looking for quick results compared to traditional investments, but as I have already explained, the benefits of short-term predictions also come with higher risk.
If you analyze very well before opening an order you can have a possible prediction and place it on a longer time frame and then you can be more confident of hitting the prediction, but therefore the profits will be lower.
Now, if you have a little more experience, you can do it with short time frames up to 1 minute or 5 minutes and then the profits will be much better, but I repeat again (THIS CARRIES ITS RISK).
Risk and Reward Factors
I think this is the most important point that you would probably be expecting, and this was the point that also got me interested in it.
As in any investment, it is crucial to understand the associated risks, and here I repeat it again.
Binary Options, due to its "all or nothing" nature, can lead to total investment losses if your predictions are wrong, this is why I say that although for me, it seems like an easy option to make money, you have to analyze everything equally to understand the system and know which predictions will be right and which ones will not, because your profits and losses depend on it.
However, this simplicity can also be seen as an advantage, since you will know in advance the amount you could lose or win, as this is measured by % depending on the #Broker in which you are operating.
Although another point of interest is to know in which #Broker to operate, because many of them today are scams, including the great and popular IQ Option, and I will not go into details here, but recently users of this #Broker are complaining about the bad service they are providing.
Final opinion on the subject
Binary Options Investments offer an exciting way to get into the world of finance, and as I said at the beginning, it's a very easy way to get started and then take the step into #Trading with Cryptos.
With its simplified approach and the ability to trade a variety of assets, it's important to consider both the positives and the risks before getting started, so this post is not a financial recommendation, it's more of an informative post where I explain what I've learned from my point of view.
If you are willing to learn, research and make informed decisions, Binary Options could be an interesting addition to your investment strategy, always remember to invest responsibly and with caution, I personally have in mind to get into this Binary Options, but it will be in a sea of weeks when I learn many things about this type of market.
Also, I'm looking for a good and safe #Broker to start, and when I start I will use a Demo account to practice and not put my real money at risk.
I hope this post was of much information, and if you have any questions remember to leave a comment and I will gladly be answering them, just as if you are an experienced user in this topic would be great to know your opinion or you can also make some corrections of what I have mentioned here if necessary, as I am not an expert on the subject.
Greetings to all and I hope you have a great day.