There are a lot of misconceptions about trading binary options which confuse newbie traders and would-be traders alike. These myths do nothing to help new traders learn the ropes and stay safe and profitable. Some of the myths concern regulations and trading companies, while others involve trading strategies. Probably the most damaging myths involve unrealistic expectations about trading outcomes. Trading is a great way to make money: many people learn how to trade successfully every year. Many trading platforms open and offer tools for trading. Nevertheless, the public opinion is divided. Some people believe that trading online is respectable and profitable business. Others argue that such trading is like gambling and outcomes are not predictable.
What is a reason for so many myths? How to succeed? How not to fail? Let’s consider some popular views on trading and discuss if they are true or not.
Opinion #1. Binary Options and Forex are the Same
Not true. They are like apples and oranges. Binary options trade currency, metals, and many other existing assets. Trading electronic contracts is much simpler and more affordable than Forex. Trading requires a trader to see where the price is going and follow the direction wisely. Even if the price changes by one point, there is a profit. The same applies to losses. Forex is different: the profit depends on the number of points that the price will go in the specific direction. People lose money when the market turns against and people do not close the deal on time.
We recommend to try Forex if you are an experienced trade.
Opinion #2. Binary options are like gambling
Not true. Like any market, binary options have some logic behind it. Traders need a well-formed trading strategy based on analysis. There are many indicators, indices, parameters to help traders to do their calculations better.
The Pocket Option trading platform offers the traders the most popular indicators and technical tools. You can read tutorials, recommendations and practice with your free demo account.
Opinion #3. Fast Money on Binary Options
It depends. While trading electronic contracts, you do not have to wait until the price passes a certain number of points. You need to define a trend and ride it. Secondly, a binary options market is quick. Some trades take only a few seconds. So traders can make and lose money quick.
Opinion #4. Binary Options are Very Risky
Not true. There are more risky endeavors. In electronic contract trading, profit and loss are predetermined. Therefore, no matter how you make a mistake with the analysis and no matter how much the price goes against you, you will only lose the amount in the transaction.
As you know the minimum to trade in Pocket Option is only 1 dollar.
Opinion #5. You need a well-established strategy
True. Buying and selling at random is madness. You need a system that works. Read, learn and practice to figure out the right strategy. Fortunately, even beginners can be successful. You can find many effective trading strategies offered by the experts. The Pocket Option trading platform offers you a free demo account so you can practice.
Some opinions about trading of electronic contracts are right, and some are wrong. You should make your own opinion. You can try trading without risk when you sign up and get a free demo account from Pocket Option. Why should you waste time trading with virtual money before you trade with real money? Because when you first get started, even if you have done a ton of research and testing, you are probably going to lose a lot of trades. If you are losing fake money instead of real money, you are saving up your real money for when you actually know what you are doing. The idea may make you impatient at first, but it will ultimately save you time. It will also teach you how to be patient and responsible, which are critical skills for binary options success.
So yes, a demo account is important.
Whatever people say we agree that Binary Options can be a challenge. Most people eventually understand how much potential they represent.