August 29, 2015 at 8:02 pm
I have been trading SPOT FX for about 2 years now. Pretty successful I’d say thus far. I did some research on binary options and was wondering if it is worth switching over to binary options trading? It looks and sounds to be easier, simpler and requires less time in front of the screen.
August 29, 2015 at 8:29 pm
I don’t think it is a matter of making the switch from one to another. Stick to what has been working for you. Sound like you have been profitable in Forex, thus I’d stick to that and maybe add binary options as an add-on. See how it goes, maybe you find it to be a better alternative for you.
Who knows? Only you 🙂
Let us know what you decide to do and how it pans out for you.
August 31, 2015 at 2:02 pm
Hi Micaela I would like to chip in and give some advice. I saw someone post somewhere on the forum that he uses both binary options and spot forex to trade with. I can’t recall which topic it was though, but here is how he does it:
So basically he focuses on long term trading the spot forex market. he uses anything up from the 4 hour timeframe. he sometimes uses the 1 hour for entries and exits. this also gives him some sort of trend to take binary options trades in the same direction.
He then uses binary options for smaller moves in the market. he trades them to keep him busy so that he does not fiddle with his longer term spot forex trades.
I hope you can make use of some of this information, because I know that I am definitely going to give it a try 🙂
August 31, 2015 at 2:56 pm
Hey there Micaela,
Always good to hear someone is making money trading, no matter what type of trading it is. I believe we have to stick to what works for us as individuals. What works for me, might not work for you. You get my point? So the choice remains yours. Give Binary Options a try, see how it goes. Don’t start out big though. That would just be stupid in my opinion. With some brokers you can get a demo account after making the minimum deposit. I know StockPair allows that. Fund your account with $200, get on live chat and request a demo account. Use the demo for a week or 2 and practice. If you feel you can adapt and make money – by all means go live. If not, withdraw your funds and call it a day.
August 31, 2015 at 3:14 pm
I would never ever – never ever lol leave FOREX for binary options EVER! I love the risk to reward ratio that FX offers you, which is not existent on binaries. I stick to my risk reward to make $2 for every $1 I risk. It helps me with money management as well as looking after the most overlooked factor, being your capital!!! OMG guys… come on! Without capital you cannot trade. Just like you cannot start up an offline business without capital. Basic stuff people tend to forget.
Just my 2cents folks.
Happy pipping 🙂
August 31, 2015 at 3:31 pm
Very good point you make about the risk to reward ratio. the only problem I have with this is that if your stoploss is 20 pips and your risk to reward is 1 to 2. this means that you risk 20 pips to make 40 pips. So you need the market to move 40 pips in your favour for your target to be reached. This can sometimes be a waiting game and it can have a huge effect on your psychology.
Binary options is much easier to reach your profit at expiry time, without needing to worry when to exit your trade and all that. The market only needs to move a few pipettes to be in the money. This is the way I see it.
August 31, 2015 at 3:39 pm
Hey Madelyn I do have a lot of respect for your opinion, but I must say that I totally agree with what Jerrie said.
Being a newbie and all, I find it easier not to deal with the calculation of lot sizes, leverage, stoploss and profit target. I have heard so many times that a lot of people get margin called easily because of using leverage. By all means if it works for you, you should stick with it. I just find it better for a newbie like me to stick with binary options for now.
All the best
August 31, 2015 at 4:00 pm
Hi Newbie, yes it is true that most people do get margin called due to using the wrong leverage and risking too high a percentage of their account per trade.
Leverage is also known as a “double-edged sword”. This means that you can use it to your advantage if you know what you are doing, but if you don’t, well then you are in for some difficult times…
Rather start off with small leverage and don’t risk more than 1% of your account if you decide to start trading the spot forex market. Or better yet just demo trade to get used to it.
September 1, 2015 at 11:56 am
I will try to respond based on experience to your question about the comparison of binaries to forex. I would love to give you a yes or no answer but the truth is the two are completely different in nature therefore it is hard to compare but I will do my best here. Binary options trading is much more risky than forex and still does require hefty chart work to be successful. The payouts seem glorifying but do not let that fool you, after calculating the amount of win percentage you need to be successful in this market you quickly realize that it is not as good as it seems.
Am I saying binary options are a waste of time? Of course not you can make some very good money trading binary options but to say they are simpler easier and/or a walk in the park when compared to forex I would say NO. This assumption is why a lot of newbies lose money when getting into binary options thinking with that mindset. If you are going to get into binary options treat it just like you would treat your forex trades and manage your risk, do your due diligence, check news. One important factor is binary options are much quicker than forex and have fixed payouts so it’s either you win or lose there is no going back or hedging positions. The flexibility in binary Options is much less than forex but also the complexity seems to be less with binary options on the surface. However the longer you trade binary options the more you will see it is in fact probably just as complicated if not more complex than forex trading.
Hope this answered your question, cheers.
September 1, 2015 at 12:02 pm
Ok so let me start off by asking if you are profitable with forex why switch over to binary options now? Binary options seem like a much smaller fish compared to the multi-trillion dollar forex market and If I was successful in that I would just stick to it and not even bother. Most people who get into binary are usually new and use it as means to get into forex not the other way around. I would say that binary options are easier than forex to understand since you do not have to calculate lot sizes, leverage or any of that stuff. Binary options are mostly simply up or down call or put options and are pretty easy to understand.
A lot of binary options brokers offer different styles such as one-touch options, ladder options and longer expiry times but most people just trade call/put options since they are the most popular. All in all I would say probably stick to forex if you are already making good money with it but if you insist on trading binaries make sure to go with a good broker that has been around for a while and has a solid reputation.
September 1, 2015 at 12:10 pm
Hey there Micaela
I trade binary and forex and I see it this way, Forex is the bread and butter for me. It is where I make my living and live comfortably off of it so I am kind of in the same boat as you in that regard. I look at binary options as a more risky investment almost trading for the rush and trading exclusively to make some quick extra cash. Sometimes I use the 60-second options if I REALLY feel strongly that a pair is in a trend and has a good setup. It has been working well for me so far and I think that by having a background in Forex that definitely gives you and advantage to a lot of other binary options traders out there. What I sometimes do is use my analysis or open positions I have in my forex account to help with binary trading and this for me has made me a pretty successful binary trader. I also do not take the binary options as serious as other may since as I stated earlier Forex is really my main gig.
September 1, 2015 at 12:30 pm
Hello there I only used to trade Binary Options but recently got into forex trading and I would say binary options is a heck of a lot easier to understand.
I started binary when I was only 19 and am now 25 years old so I’ve been trading binary for a while. I made a lot of money very fast and lost a lot twice as fast as I won it.
All in all, I would say that after getting into forex it is definitely easier to make money with binary, but it is also a lot easier to lose money too.
So it is honestly hard to say which is truly better but I think both have their ups and downs.
September 1, 2015 at 1:00 pm
Binary options are a much fast pace high risk form of investing and is not for everyone. Please make sure to practice on demo before opening a live account and test out your strategies as something that works on forex will most likely not work for binary options. Binary options is a term that refers to the binary code 0,1 computer language and they use this comparison for a reason. You only have two options either up and down. Your either right or your wrong hence the term binary (two). Binary Options are a very fast pace environment and need to be treated with respect unless you want to go bankrupt. One could even make the comparison to the high frequency traders on wall street that pump and dump stocks in seconds rather than holding positions for longer periods of time. Binary options are in a way sort of the beginners version of forex for some but also many newbies are trapped into losing their entire accounts due to false thoughts of it being “easy to make money”. It’s never easy to make money and anything that seems too good to be true usually is. Another thing most people forget to mention is that with binary options there is no real liquidity other than what is in the broker’s bank account. Unlike forex there are no banks or financial institutions backing any binary options brokers to payout clients and also there are no spreads so brokers get paid solely from losses. So basically the only way binary options brokers make money is by having more losing traders than winning ones which in a way is kind of how Forex works but is not as sophisticated or regulated. Forex has also been around a lot longer and binary still has a long way to go.
Hope this helps.
April 20, 2016 at 11:56 am
Binary is easier to understand and has less options with regards to trades.
However there are some limitations when compared to forex for example.. generally in binary options the payout is around 80 – 85 % however in forex there is no limit other than self set limits as to the available or possible returns.
Binary is good to use as part of your overall trading strategy.
You must be logged in to reply to this topic.