Different Types Of Trading Strategies

Different Types Of Trading Strategies

Submitted by adil on Wed, 08/22/2012 - 04:08

In binary options the key to success is to deal in multiple assets. This will trim down the risk of trading your investment. The most common strategies used are:

1.      Collar

This strategy is the �strategy of reversing the risk�. In this strategy, the premium costs are offset by selling other possessed options. When you completely recover the costs, it falls in the category of costless collar. It is the best way of minimizing the risk of traders.

2.      Covered call

This strategy is used by selling a call option, to enhance your position and profits, by minimizing the risk. This will add a layer to your fund portfolio. It will diminish the risk.

3.      Money management

It is the defensive strategy and keeps your portfolio checked all the time. There are two styles used by traders: hard stops and position size.

4.      Straddle

This strategy holds the investor in two positions: call and put. In both of them, he has the same expiration time and strike price.

5.      Market conditions

Market conditions change with time and it depends on the quality of your instincts and experience that how well you read these changes.