Forex Traders Switching To Binary Options

People interested in binary options are usually those who just want to earn some money having no idea about trading. A person visiting some website can be attracted to an advertisement telling about opportunities to earn good profits by trading binary options. Then he/she decides to give it a try and invests without properly learning the specifics of this industry. Meanwhile, binary options brokers aren’t much interested in educating their customers.

It’s worth to mention that Forex isn’t much different from binary options. One thing they have in common is that traders mainly deal with the same markets. Technical and fundamental analysis which Forex traders do can be used by binary options investors as well. So, if you already have currency trading experience, you’ll have significant advantage over those who aren’t familiar with any of the industries.

People with Forex trading experience can understand markets and know their behavior patterns. Therefore their chances to become successful traders increase. Novice traders with zero experience under their belts typically have just basic theoretical knowledge, and as a result, they aren’t able to explain why markets change. These investors are good at guessing future market moves rather than forecasting based on the facts.

Recommendations for Forex Traders Switching to Binary Options

If currency traders have experience and basic theoretical knowledge, they can easily adapt to new trading rules. Moreover, if they succeeded in Forex and were able to earn profit, there’s a great chance they’ll benefit from binary options trading.

Unlike Forex dealers, binary options brokers don’t always offer demo account feature. But to make first binary options experience risk free traders are recommended to find those websites which would give this opportunity. While using demo account you’ll at least have a chance to get used to new platform and industry standards. It can also help test your strategy and find out how effective it is.

When switching to binary options Forex traders should first of all learn how this new market works. Then they need to determine which strategy they want to use and test it using demo account. If the strategy seems to be fine and you are ready to start real money trading, top up your account with minimum amount of money which would be enough to have ten contracts.

To become successful binary options trader, it’s important that Forex investors learn to be as precise as possible with their timing. Foreign exchange market doesn’t require watching time that carefully because it’s possible to close a position at any moment. But binary option contracts have specific expiration time and usually there’s no chance to change it.

What Do Forex Traders Fear?

Their main concern is that each time a trade closes out-of-money, traders have losses equal to 100% of the contract size. This is quite unusual for currency traders because they got used to controlling the size of their losses. But the chance to earn high profit usually helps them overcome their doubts. For a short period of time binary options can earn you on average 70-80% profit which is rare when trading Forex.

It would be fair to mention that Forex trading can also involve quite high risks, and losses can even exceed the amount of a position size. This often happens with inexperienced investors which don’t set stop-loss levels and are reluctant to close positions before it’s too late.

If you have Forex trading experience then you have a big advantage, and it would be a lot easier for you to learn binary options market. Your knowledge and expertise will help you reach success, therefore, you shouldn’t doubt too much. By the way, trading binary options doesn’t mean you have to give up on Forex. It’s possible to pursue both trading careers at the same time.

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