Top Ten Binary Options Trading Mistakes

Top Ten Binary Options Trading Mistakes

Submitted by adil on Fri, 01/18/2013 - 05:01

A few years ago, not many people had heard about Binary Options trading. But today it is quickly catching on as a proven way to make money on stocks. Many still consider making money from Binary Options as mere luck. What they don't know is that a decision made in such trading has a lot of reasons and researched data behind it. It is not mere gambling but a calculated move, mathematically proven to get results. Initially it is important to not make the mistakes that most beginners make with�Binary Options�Trading.

It is very difficult for a trader to survive in such a competitive market without taking assistance from brokers. Traders usually rely on guesses and fake signals for taking their investment decisions. Investment based on fake information results in severe losses, which are hard to overcome.

Some traders fully rely on market alerts for buying and selling commodities or shares, which is not wise enough as market alerts are not always reliable.

Some markets are highly volatile in nature, which creates more problems for traders. When traders reach to any decision then market trend suddenly changes causing loss.

Some other traders fully depend on their luck, which is yet another mistake. They accept loss thinking that it was their bad luck. However, luck plays an important role in our success but this does not mean that we stop doing any effort to avoid loss.

If you have also come across such a loss then you are not alone, as thousands of other traders have already lost all their savings in trade due to their own little mistakes.

Now is the time to learn lessons from these mistakes. Instead of losing hope, you must try for one other time but this time you have to follow my advice. Following are Top 10 Things that you need to consider while trading.

1. Do Your Homework

   You can't expect to just make money all the time by basing your decisions on just luck. Try to understand and read the graphs. Check to see if you can predict the nature of the graph and practice doing that till you get it right most of the time. Only then invest your money.

2. Don't be Greedy

   Putting money on a risky move to get higher dividends may pay back once or twice but it is a risky move to pull unless you know what you are doing. Do not equate risk with profit.

3. Always Start Small

   Don't jump in by investing huge amounts. Try investing smaller amounts like a few dollars and see if you are making money. Test the waters. If your predictions are turning out to be right, try asking the professionals how they work with larger amounts. You can also check sites for videos and info on how others do it and learn.

4. "Gut Feelings" don't always Work

   Avoid basing your decisions on "gut feelings". Yes they might work for you now and then but the odds are that you will lose money if you keep basing your decisions on emotions like that.

5. Don't Try Hedging your Position

   If you see your stocks slipping in the direction opposite to what you had initially predicted, do not fear. The market might take a few twists and turns. What you should never do is invest in a binary option opposite to your initial investment to cover your losses. This is a bad move. Instead wait it out.

6. Experience is your Best teacher

   Nothing or none teaches you better than your own experience. So don't miss out on it. Make sure you have loads of experience trading before making bigger investments.

7. Know When to Quit

   his is a very important lesson. Most people say it's best to quit when you are ahead before you it gets to your head and you make decisions you regret. Also remember that if you aren't doing well, it is good to quit to. Make sure your decisions are based on your reading and charts and not on emotion.

8. Only Money can Help you Make Money

   It takes good investment to make big money. You can keep trading with small investments and not make anything substantial at all. But this doesn't not mean that you go with a large investment scheme. Always make calculated moves.

9. Weekends are Not for Beginers

   Weekends might offer you more spoils of war but do not be tempted easily. It is quite possible that you might lose more during the weekends, so stay away from trading unless you are a professional.

10. Do It for the Fun of It

    Binary Options trading is a smart way to make money rather than droning in your office for hours. However it requires its own preparation and loads of patience. So unless you start loving it you won't get far. Enjoy making money this way and dedicate yourself to it. If you are having fun doing it, the chances are that you will get better at it naturally.

It takes time to learn about anything and it is the same with binary options trading. Take time and do your homework. It will pay you back in great dividends!