When trading in binary options, forex binary options are one among the many options available to you. Just as is the case with traditional forex trading, here you are still trading currency pairs. The main difference is that you require a larger investment with traditional forex.
Let us assume that you had a $200 investment into a given currency pair and if you guessed correctly you would get $340 in return.
The trading platform also takes into consideration the price level during your chosen expiry time, or simply put you have no leverage to contend with. This means that if a given trade were to move against you before the expiry time you still have enough time to make your money back and still manage to win your trade.
In traditional forex trading, if a trade were to go as little as 5 percent against you, your forex trading platform would simply automatically close all your positions leaving you with no opportunity to make back your money.
One more benefit of binary options trading is that you have no requotes to contend with and spreads never widen as they sometimes do with traditional forex trading.
With Usually, the people that excel in trading currencies are in hedge funds or other types of systems with massive capital outlays. What they aim to do is login here and stomp on the smaller players just as children love to squish bugs.
Forex binary options never expose you to the nightmare of ever being gobbled up by the market sharks. You can remain a small fish while getting started with some practice then investing increasing amounts of money as you gain experience.
Forex binary options also offer another benefit over traditional forex trading in the form of having an expiry of less than a pip in the money and you still getting the full return on your winning trade. To achieve a similar result, traditional forex trader may first have to gain close to 100 pips.
The only real downside to forex binary options trading is the fact that as with all other kinds of binary options, you cannot close trades before the expiry time. This means that while you may be in a Kelly Wallace Wikitrader winning position before the expiry time you risk losing your trade even when you are less than a pip out of the money.
However, if you do experience on and a losing trade you don’t have to any margin call to deal with meaning that you will never have to put additional money into your account unless you would like to do some further trading.
With Still, binary options are a great way of getting into the forex market compared to the traditional way.