Facts About Binary Options And Its Value In Gold Trading
One of the ways you can benefit from gold is by trading it in the binary options market. In 2008, binary options established itself as a reputable method of trading financial instruments. In binary options gold trading, you are presented with two possible options and these are to either win or lose.
Also known as digital options or fixed odds options trading, binary options is where traders buy (call options) or sells (put options) an asset’s contract in order to acquire returns from an increase in price (for buy) or a decrease in price (for sell) at the contract’s expiration date.
Here are some important things to take into mind when it comes to trading in the options market:
1. The Expiration Date or Time – The trades in this market have expiration dates or time. The trader is provided freedom to decide on the certain date or time of expiration of the same day, also known as intra-day. For most brokers, they would usually schedule the expiration ceilings at three months.
2. The Target Price – Target price in this market is also known as the strike price. Before the expiration date or time, this price should be attained in order for the trade to be “in the money” (profit) or “out of the money” (a loss).
3. Profit From a Buy (Call) or a Sell (Put) – If the trade goes along with the trader’s plan and hits the strike price exactly or before the expiration of the trade contract then that trader earns from a Buy (Call) or a Sell (Put).
Here are some advantages of using binary options in gold trading:
1. Lower Margin Requirements – The margin required for trading gold in this market is much lower. With a cash amount of $ 100, you can already start your trading venture in this type of market unlike trading spot gold with a broker that you have to come up with $ 10,000.
2. More Convenient – You do not need to calculate or set up calculating leverage, stop loss levels, etc. since these factors don’t have a purpose in this type of market.
3. Less Complicated – The process involved in the trade is easy to comprehend, execute and learn.
The binary options market is the best choice for anyone who is inexperienced in the world of trading or for anyone who does not have a budget for the requirements of the steep margin for gold futures or spot gold trading. This market can provide you with an actual experience in gold trading without getting you exposed to a huge amount of risk.
Source by Jun M Diel
