Binary options trading can be described the two options trading where you predict either rise or fall in the value of an asset. It is called binary as it gives you two outcomes – large profit or no profit. This type of trading is becoming popular as no buying of commodities is involved here. One gain profit when the market fluctuations align themselves with the predictions.
Long term binary options trading is the one preferred by more experienced binary traders who want to put their market knowledge to effective use by taking a long term view. Long term binary options trading is involved with prediction of rise or fall of the value of an asset within a specified time frame. Here the expiration time can vary from a week to months, but most commonly it is a week that is chosen as the expiration time.
For both traditional and long term binary options trading, the process is exactly the same. In both, you have to select the asset and the expiry time, and then you have to determine your investment amount and then predict whether the price of the asset will move up or down. In binary options, there are three main expiration times. They are hour, day and week. Hourly expiration times are the short term binary options and in weekly expiration time the option expires at the end of the trading week. If you choose a day as your expiration time, your trade will be concluded by the end of the day.
Long term trading is practiced based on logic and strategy. Here we need to calculate and analyze the details carefully. Patience and confidence are the must haves for a trader engaging in this type of trading. Long term binary options traders can cut down their potential losses by closing them before expiry time. The readers must be well versed in the past and present day fluctuations of asset value, the trends and the factors that can affect the value of an asset. You must be up to date with the happenings in the world which may directly or indirectly affect the value of your asset.
It is because of the fact that most of the time it is those silly inconsequential things you don’t care about, that will make or break a man’s fortune. The traders involved in long term trading are less concerned about the day to day fluctuations; they are more focused on the trend and its end time. You must have objectivity and discipline if you are trying to engage in long term trading. People are attracted to long term trading as here you can overcome small losses by making huge profits.
Long term binary options trading are the way to choose if you have an in depth understanding of the long term forecasts and market trends related to a particular financial asset. You must choose your assets wisely for having greatest chances of success. Learn more about the market and industries and choose the one which is most promising or most deteriorating.
Advanced features of this type of trading include double up, sell back, take profit and hedging. Double up permits you to double your investment in an open trade. Consider this when your expiration date is close and you are completely sure of the success of your trade. Sell back allows you to sell your open trade back. This is mostly done to cut down potential losses.
If you are concerned that the value will go down when you are ‘in the money’ you can exit the trade before the expiration time elapses so as to get your profit and minimize losses. In hedging you are placing two bets. One on the price going up and another on the price going down. You will definitely win one of those. This reduces risk of losing.
This is much simpler and easier way to make money in trading. It is not completely risk free, but in case of loss, you can cut down your losses more easily here. Be disciplined and remain objective if you trying to engage in long term binary options trading. Good luck with your trading venture!