Binary Options

3 major cons of trading in binary options

8 - 3 major cons of trading in binary options

In our previous post, we looked at 3 benefits of binary options as a potential investment avenue for the profits from your business. We established that this can be a risky yet rewarding investment and a good way of getting financing to reinvest in the growth of your business.

Just as a recap, we defined binary optionsas a financial option in which the payoff is either some fixed monetary amount or nothing at all. It’s commonly referred to as an all or nothing investment. Trading in them is considered to be risky, but the potential rewards are usually really good. This however only applies to risk takers who believe that high risk is equal to high rewards.

Let’s take a look at 3 cons of trading in binary options.

Binary options have limited trading tools available

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A number of financial experts are of the opinion that trading in binary options is no different from gambling. In fact, in some countries, trading in them has been banned. One of the reasons binary options are not recommended by financial experts is because in most of the websites that offer their trading do not provide an investor with advanced analytics such as technical analysis as well as charting. These are basic features you will find on a typical forex trading site. These analytic tools are important because they help an investor understand market trends well so that they can make informed decisions. As an entrepreneur looking to invest profits from your business, it will be important to think long and hard before ‘gambling’ with your profits.

Binary options have limited regulation

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The biggest disadvantage about binary options is that trading in them is highly unregulated. Most of the brokers who provide this service don’t operate within any legal framework therefore, nothing stops them from taking investor’s money and closing shop. It’s therefore important for you as an entrepreneur looking to invest money from your business to do your due diligence and ensure you don’t risk your revenue in such risky ventures. Sometimes, it’s never worth the risk.

It’s difficult to learn about trading in binary options before hand

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The beauty about platforms offered by other forex brokers is that you can get to learn about trading in them through a demo platform before investing your hard earned money. However, when it comes to trading in binary options, you can only access demo trading sites once you have opened a real account and deposited your money in it. This means that you are bound to lose some of your money before you get a grasp of trading. As an entrepreneur, this is not the kind of venture to risk your business profits.

All in all, every investment option usually has its pros and cons therefore it’s upon you the entrepreneur to decide whether the risk-reward associated with binary options is worth it.

We invite you to share with us your experiences and success stories in your business adventure.

3 benefits of trading in binary options

7 - 3 benefits of trading in binary options

When running a business, it’s always a good idea to reinvest some of your profits back into the business, and invest the remaining profits on other ventures. Diversifying your investment ensures that your eggs are not all in the same basket therefore they are not exposed to the same risks. If one doesn’t pan out, you have the other investment to count on. One type of investment you can consider is binary options. This however only applies to risk takers who believe that high risk is equal to high rewards.

A binary option is basically a financial option in which the payoff is either some fixed monetary amount or nothing at all. It’s commonly referred to as an all or nothing investment. Trading in them is considered to be risky, but the potential rewards are usually really good.

Let’s take a look at 3 benefits of trading in binary options.

Binary options have a potentially high return

When it comes to binary options, an investor is usually looking at a potential return of between 60 and 90 per cent. Talk about high risk high return. This is a significantly high potential return in comparison to other available investment options out there therefore, if you are successful, you can get some good return which can help in your business expansion plans.

With binary options, your risk is fixed

The beauty about investing in binary options is that as an investor, you will get to know up front exactly what you stand to lose versus what you stand to gain when you trade. This is why it’s referred to as a fixed risk. Your investment will not be affected by fluctuations in the market. This therefore means that if you intend to invest in binary options with some of the profits from your business, you will be able to make a determination early in advance whether you can afford to lose this money, as well as determine whether the potential returns will be sufficient for the plans you have in place for your business.

Binary options are easy to trade

When looking for a place to invest profits from your business, binary options become a convenient investment because it’s fairly easy to trade in them. The trading platforms that have been set up are easy to operate especially by individuals with no investment experience. There are a number of online platforms that are very user friendly, and they allow you to practice through demo accounts, video tutorials, as well as live chat options where you can be guided in real time on how to go about it.

Whereas some financial experts might classify binary options as some form of gambling, the truth is all other investments are in truth gambles. You can never really predict market forces. As an investor, once you get a hang of it, binary options can be a really quick and effective way of raising financing for your business, but ultimately, do remember the risk as well.

We invite you to share with us your experiences and success stories in your business adventure.