Strategists Predict Trouble For U.S. Stocks After Massive U-Turn Common Binary Options Questions From Beginners

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Common Binary Options Questions From Beginners

Binary options are financial instruments that carry some risk. You can buy Binary Options on stocks, major indices, commodities, and currencies. You will be able to make a prediction on what you believe an underlying assets price will be later in the day or even week. Basically, you take a stance on whether or not you think the price will be higher or lower by the time the option expires. If your trade is correct, then you will receive a payout based on your original investment. If your trade is incorrect, then you will lose your initial investment (however some brokers give refunds up to 15%).

Below are some common questions that people have who are not familiar with these financial instruments. This should help clear up any misunderstanding you have right now.

Do I Have Ownership in the Company?

This is a common question from people. Since you are trading assets of a specific company, it seems like you would have ownership. However, these are not shares and you will not have any ownership. Purchasing a binary option instead gives you the ability to make money on the movement of an asset’s market price. Once the expiry time comes, you will have no other ties to any companies.

How Does Binary Options Trading Work?

First you would pick an asset. In this example we will use gold as our asset to trade. You think the market price of gold will be higher in two hours than it is now. So, you decide to buy a binary option worth $100 on gold. The broker you go through says that you have a return of 76% on this trade. If the price of gold is higher, then you will receive $176 back (your initial $100 investment plus $76 profit). If the price of gold is lower, then you lose your initial $100. After a trade is over, you have no more ties to it and the most you can lose is your initial investment.

Where Can I Trade Binary Options?

There are many Brokers available through the internet. Each has their own advantages and disadvantages. Some have platforms that are very fast and easy to use even for first time traders. Others offer great strategies for people who deposit money into their system. They will give videos as well as eBook’s covering the best ways to trade and turn a profit.

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