Binary Options in India: the guide to binary options trading in 2020
The secret behind the popularity of binary options trading in India is that it offers quick results with only two possible outcomes. These outcomes are mentioned in the contract itself.
The contract present in binary option allows the trader or the buyer to purchase a given asset at a given price within a specified period of time. The items that are traded in binary options are termed as underlying assets and this range from commodities like oil or gold, currencies of different countries and indices that purchased or sold at the strike price. What the trader has to do while trading binary option is, to choose whether the underlying asset will reach the strike price within the determined expiry time or not. This selection process in trading is done at the end of an hour or week or even within the end of a minute depending trader’s choices.
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Option trading in hindi: भारत में बाइनरी ऑप्शन ट्रेडिंग: हिंदी संस्करण
Binary Option trading in India: the complete guide
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What is binary options ?
Binary options are simple trading positions based on the value of a given asset. These assets are usually stocks, commodites or Forex currency pairs. In binary options trading, a trader’s position is determined entirely by his or her prediction of whether the value of that asset will go up or down. If the prediction the trader makes is accurate, the trade will pay out with a predetermined amount of profit.
How do binary options work?
Binary options are an unusual trading vehicle in the sense that they do not involve ownership of an asset and therefore are not technically equity-based investments. Binary options are, however, based on the values of the assets they are built around.
Needless to say, in such a system, binary options trades need to have a definitive cutoff time. In binary options trading, this cutoff time is usually referred to as the expiry hour. Binary trading can, however, take place over many different time periods. In the early days of binary options, it was typical for brokerages to offer 30 minute and one hour time increments. As options trading has become more popular, however, brokerages have begun offering both longer-term and shorter-term options. Many binary options brokers now offer expiry hour increments ranging from 30 seconds on the low end to more than 24 hours on the high end.
In a binary options trade, the return level is set when the position is opened. Many traders actually prefer this, as it allows them to know exactly how much money they will make on their trade if they correctly predict the movement of the market in advance. In addition to this, many brokers are now offering risk management features that allow traders to take on lower risk in a binary position in exchange for lower returns.
What you need to know to trade binary options in India
If you want to become a successful binary options trader, you’ll need to dedicate yourself to a study of the markets. You need to be able to discern how different economic events. Like jobs reports, will impact different assets for longer-term trades. If you understand basic economics and watch for trends in how assets move under certain circumstances, you’ll have a better chance of being an effective long-term trader.
Also important to a binary trader is price fluctuation analysis. Binary options trades, especially ones with very short expiry times, tend to work more on tiny fluctuations than on macroeconomic trends. This is why traders who plan to focus on short expiry times should learn to analyze charts of recent price movements.
Let’s see an example
For example, most assets will have points above or below which their value has not broken recently. These points, known as support points, are good indications of where the value of an asset will find its minimum and maximum in the near future. Say, for example, an asset has fallen in value until it is near a support point it typically does not fall below. Traders relying on trend analysis would likely open a “Call” position, assuming the fall would reverse as the price neared that support point.
As a general rule, the more analytical methods you can master, the better off you will be as a trader. Combining multiple methods of predicting an asset’s value can help you come up with a more accurate prediction. The more accurate you are, the more trades you will be able to win on.
What investment goals are binary options good for?
If you are a conservative investor looking to make small, long-term gains for a retirement account, binary options probably aren’t the ideal investment for you. If, on the other hand, you want to conduct short-term trades for liquid income, they may be right up your alley. If you’re an investor who prefers diversity and wants to add an income-producing investment vehicle to an existing portfolio, binary options might also fit your goals, depending on how much risk you are comfortable with in active trading.
Is binary options legal in India?
Yes, binary option trading is allowed and legal. This means that anyone who decides to trade binary options in India can do so.
Things to know about binary option trading
A ‘Call option and a Put option’ are two important or integral terms that a trader must be aware of while trading in binary options. The trader or the owners goes for a call option when he or she feels that the price of the underlying asset at expiry time will be much more than the price currently.
A Put option is placed when the trader feels the price at expiry will be lower than the price currently. The procedure in binary trading is very flexible but the only hidden factor that remains in the process is about the change in price of the asset during expiry from the current price. The profit percentage or the returns that will be available to the trader is decided at the time of the contract itself, that is a trader earns 70 to 91 percent profit if his trade option expires in the money.
This above-mentioned information on binary option can also be explained with the help of a real life situation of Mr. A, who invests 100 dollars on oil with a return rate fixed at 70 percent at the end of the expiry time. Say the current rate of oil is $65.9001 and if it remains the same while closing. The investor will earn 170 dollars and on the other hand if the product closes at a price below $65.9000 then the investor makes no profit. It is because of the simplicity of binary trading that the traders are easily attracted towards this modern way of investing.
What separates binary form of trading from the traditional way of trading is that in binary option the buyer trades on the basis of the asset performance without the need of actually buying it. For instance if a buyer is trading in Microsoft shares then he or she is not actually buying the shares but earning profit based on the differences in share value within a given time period.
An introduction to online trading
Binary options involves a contract, which details the two possible outcomes traders can expect from it. The trader has to purchase a particular asset at a given price and within a specific time span. Various items can be traded through a binary options contract and these items are mostly referred to as ‘underlying assets’. Some of these assets include gold, indices, oil, stock and currencies of different countries. But the question is how to trade binary options? It is very easy to get involved in this form of trade as all the trader has to do is figure out if the price of the asset will reach the strike price during the duration of the contract. A successful trade can earn substantial profits for the investor.
Binary option trading: how to start ?
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Advises to improve your binary option trading
There are a number of helpful tips provided by Indian expert investors through which it is easier to understand how to trade binary options. There are no magical formulas, which can be used for earning instant profits from trading, but these tips can be useful in formulating an effective strategy. Some tips are discussed here:
Practice and experimentation are the most effective means of learning how to trade binary options. In order to get their feet wet, novice traders can open up demo accounts and use virtual money to practice. Traders can hone their skills and comprehend the process by making use of these accounts that are offered by a number of brokers.
Knowing Your Asset:
No matter what kind of investment is being made, risks are part of the package. Although the risk may be smaller in binary options, it is still there. But risks can be minimized in order to maximize the profit. First and foremost, an investor needs to select the asset. Multiple asset categories exist, but choosing an asset about which you have firsthand knowledge can be a wise decision. This is because people can identify what will cause price movements of the particular asset and make a decision accordingly.
Types of Binary Options:
Another important factor that leads to a successful trade is to be aware of the variety of binary options that are available for trade.
The field of binary options is quite easy to learn and comprehend and so is very popular among amateur and experienced investors.
There are two outcomes to trading in binary options, winning the asset, or winning nothing. In binary trading, the return value is predetermined at the beginning of the trade. The trader speculates if the value of the asset will move up or come down. The simplicity of trading in binary options is in the fact the trader only needs to be familiar with the direction of movement of the asset value, and not any specific information about the asset.
TERMS USED IN BINARY OPTIONS
Terminology reading Binary options also called as digital options, there are various terms with which one needs to be familiar. This enables one to get a better grasp of the concept of binary trading.
This describes the items that are being traded on the binary platform. One of the advantages of binary trading is that it allows a wide variety of assets. Currencies, indices, stocks, and commodities are some of the commonly used assets.
This is the time which one estimates that the asset will touch the strike price. The expiration time can be decided conveniently and can be short as a minute or for a longer period extending to months. This is another reason for the popularity of the binary options trading.
When traders predict that the asset value will go lower within the expiration time, then they choose the Put option. If the asset price goes down at the expiration time, then the option is considered in the money, else if the asset price goes up at the expiration time, then the option is categorized as out of the money.
This option indicates that the traders predict that their asset price will rise higher at the expiration time. If the price is high, then the option is in the money, else, it is taken as out of the money.
There are numerous benefits to trading in the binary options. The risk factor is also controlled, as the outcomes are determined at the beginning of the trading. The trader is also allowed the flexibility of choosing a convenient asset and expiration time.
When and how to trade binary options in India ?
In the financial world, there is one particular instrument, which has gained ubiquitous popularity: binary options. Especially in case of the beginners, this specific financial tool has become a profitable way of making money in the financial market without a large capital. There is no difficultly in understanding how to trade binary options, and the benefits that can be reaped are such that experts and beginners alike are simply flocking to options trading, eager to make the most out of their investment. Know how to trade this new market is relatively simple as compared to other investment methods and can be learned in a very short time.
Trading and earn money
Knowing how binary options work and where it can be traded is the first step that individuals need to learn to become a binary options trader. Using an online brokerage is the ideal way to kick off the trade in binary options. Contracts for a number of binary options are written by an online brokerage and these contracts are offered on the value of numerous financial assets. That include commodities, stock and also currency pairs and cryptocurrencies. A purchase price, an expiry date when the contract expires and a barrier or strike price, which identifies the profit are parts of these contracts.
To go about how to trade binary options, an individual needs to locate a broker who can deal in the contracts you want. Typically, a broker is willing to deal in all kinds of options contracts such as forex binary options and stock. So the selection is quite easy. Once the right broker has been selected and funds have been posted, investors need to select the type of binary options. Knowledge about the three types of binary options is also a crucial part of trading. Touch and barrier options, above and below options and range or boundary options are the three types of binary options available to the traders.
It is common knowledge that binary options bear a lesser amount of risk in comparison to other investment options like the forex market. When learning how to trade in these financial derivatives, investors should also have knowledge about the payouts to be expected from them. Depending on the type of option selected, the payout can vary for the investors.
Range or boundary options and above or below options promise a payout of about 70% to 91% of the actual investment. On the other hand, a payout of about 300% or more can be expected from touch or barrier options because they are riskier and therefore will pay more.
The growth of online trading in India
The world of binary options trading in India has grown considerably over the past few years because of the high return that they offer. New investors will find that there are online brokerages which have a multitude of trading platforms. Investors can use them 24/7 in order to earn maximum profits out of their investments. How to trading binary options is deemed to be truly beneficial because this financial instrument is simple, accessible, has high-profit margins and needs only a minimum amount for investment.
Forex or Binary Options for trading currencies?
You also want to take advantage of opportunities arising from the current euro crisis to earn a little money on the markets? You’re absolutely right because the democratization of many financial products, intervene in foreign exchange markets has never been easier than today. You certainly have seen that it is possible to trade currencies with Forex Binary Options as with. So what better tool should focus in order to maximize its chances of winning?
Trading currencies on the Forex:
Forex is the best place for currency trader, you are in effect directly on the world market through your broker who is compensated with spreads (commissions) that you invoice your operations buying and selling. Thanks to the leverage you can with a relatively modest commit large sums markets: this is indeed the broker who lends you money over time to cover your position. The advantage is that you can multiply your winnings … but also your losses.
To have attractive yields and maintain a good money management, you should invest heavily in Forex. Make money with forex is possible but it must be reasonable: investing 200 euros, you can not win 5000 euros per month! It is difficult to comment on the average rate of return but we can easily believe that a person who invests 10,000 euros in forex gains may withdraw from a height of 1000 euros per month (10% of its capital engaged).
Currency trading with Binary Options:
Currency trader with binary options is becoming increasingly common: in fact, all brokers offer contracts based on foreign currencies: up / down, Touch / No Touch Option Range options are generally working on currencies and are as likely to make money.
The downside of the currency trader with Binary Options on the supply generally quite limited: in fact, you will find that most pairs are traded, but they are often the ones who are the most volatile and which courses are most easy to predict. A successful trade on Binary Options is often between 75% and 91% gains possible, much more than in the Forex.
In both cases, the strategies of position on the market must meet the same requirements: they must think its portfolio manage effectively without taking too many risks. In order to have beautiful yields, risks are a bit higher but in general if you decide to take a position on the currency markets with binary options. If you have a small starting capital, so you turn to first binary options. In contrast, with a larger initial capital, the Forex may be the most appropriate for you.
How to select best binary options brokers in India
As the popularity of trading online is growing in India, a great number of Indian traders are taking up this profitable method for increasing their profit. The main attraction of binary trading is the opportunity earning of high payouts in a short span of time.
Binary options trading is popular in all the markets as all or nothing trading. Which specifies a trader will have chance to earn all returns as profit on his investment or nothing at all. Anyone with less experience of trading can start trading with the binary options. Opening an account in a trading platform is easy and free and does not demand large deposit in order to start trading with real money.
Opening an account with trading platform/ broker, there are certain things one needs to consider. It is very important to select a binary options broker cautiously to ensure success in the trading market. Selecting the best binary platform/ broker is quiet a tough job as there are certain parameters you need to test. So that you can be assured of you are making the right way through. All key areas are given below that you need to confirm before you open an account with a binary options trading platform.
BINARY OPTIONS TRADING PLATFORM
Simple search on the internet will get you the list of the numerous brokers in India. Look at the web interface the broker is using and assess on it one the parameters of user friendliness, navigability, and simplicity. If the website does not give the ease of trading smoothly than it is better to stay away from such sites. Functionality is an important factor in many website’s success. Look for a broker that can provide you with a simple to use menu and live prices that facilitate you to trade efficiently. Also, make sure that your broker is offering mobile trading. This feature comes very handy it allows you to track and open new positions.
TYPES OF OPTIONS
Most of the brokers offer clients with ‘call’ and ‘put’ options. At times, these options are called higher or lower option. With the help of these options, you can secure your profit at a point without incurring a major loss. Since the popularity of binary options trading is increasing, brokers are offering new expiries. Apart from put or call options, there is touch options in which a trader has to predict if the asset will hit a level before its expiry.
Boundary options trading is a non arbitrage condition in which options price has to satisfy. If the conditions are broken, the arbitrage will exist. These different binary options strategies are giving a new dimension to binary trading and facilitating traders with new options all the time to choose. If you are interested in a particular type of strategy then make sure that you opt for that binary options platform offering your choice of binary options.
At the time of finalising, which binary options broker you want to go with, have a look at the payment option. There is no use of a broker, if he does not give you different payment options such as PayPal, bank transfer, debit and credit card, etc. apart from credit card. You should consider these few things before looking for a good broker.
Conclusion about binary options trading in india
Binary options are an innovative and exciting development in the still-new world of digital investing. If you are looking for an active trading investment that can produce income in the short-term, binary options are one of the possibilities you should be looking into. Make sure to research carefully before you invest, and to choose a reputable broker with whom to do business, as both of these factors will be critical to your success as a trader.