What risks are involved with binary options?

While there are ways the risk for all financial assets to be reduced, it is a fact that there is always a risk – and binary options are no exception here. First of all we want to but once explain what in the world of finance is defined as a risk: the fluctuation by the expected value. Suppose that you invest in a share that normally 10% yield per year yields. It was in a year only 9%, while in the other 11% generate is the risk of very manageable. But it is in a year 0% and in the other 20%, then the fluctuations is already very high. We speak then of a higher risk. And if I can say now that you in the case of binary options in either 85% or – 100% return, then hardly mentioned that the risk is very high.

Types of risks

although it is of course no way gives the fundamental risk from the binary options, it is especially important to be aware of these risks. You must also keep in mind what it costs to minimize the risk. Suppose you buy a call and a put option on the same base value at the same conditions. In this case it is always an option in the money and land your payouts are 100% secure. The return is but everything else as well, because in the long term you will lose money. This is roughly the same as when you buy a stock and a share short selling. If there are two transactions fees and you deserve nothing more – not a good idea. Banc de Binary Review.

Let us now take a look at the individual risks on the market for binary options:

Market risk

as well as for all other investments there is also in the case of binary options market risk and that means that the courses can move in all directions without this would anticipate. While there are options closer to assess the price developments, but the are no guarantees. The course can be even with a precise forecasts yet in a totally unexpected direction.

Limited profit

a further risk the trade rbeachten need is that your payments are fixed. In the case of binary options are both the losses as well as the profits are fixed. There is no potential for above for the favorable developments. Is positive but that also only slightly positive developments high yields and that the losses are predictable.

Very precise determination of profits

in the case of binary options is it really to smallest movements, since here very accurately the courses to be determined. Most brokers confidence here to 0.0001 points and this means that the difference between 0.0001 85% yield or total loss can mean.

Limited intervention options

once you have purchased a binary option, there is no going back. You will then need to wait until the expiry time has come. There are broker who offer an option exercise in advance, but that you should not get involved in the rule.

The risks outweigh the benefits?

While it as you can see a number of risks with binary options, there are also a large number of advantages. One of the biggest advantages is that their risks are known as soon as you make a purchase option. You know exactly what to expect and what payments you have to expect. Therefore you should also adjust your investment.

The best way to deal with the trade of binary options is to become more familiar with a free demo account to do so. So you can experience, without risking their own money. For example option888.

TradersRoom – Review

TradersRoom is a binary broker operating out of Cyprus. The broker’s platform is powered by SpotOption – a leading provider of binary brokerage software solutions.
With TradersRoom you can trade using two different ways: ProTrader and FastTrader. ProTrader is just a regular binary option platform, while FastTrader shows you a more compact view that I don’t find to be particularly useful (it only has the return percentage and the expiry time of the options with no graphs).

Options Return

The returns of TradersRoom are a bit low, compared to those of other brokers: are not the best you will find but they’re not the worst either:
• For High/Low options the return for EUR/USD is 71%, for Gold – 71%, and for Oil – 70%.
• The return for 60 Seconds options is 72% for EUR/USD and 70% for Gold.
• One Touch options offer a return rate of 400%.

Let me give you an idea what do these percentages mean. Say you deposit $500 and start betting $25 per option. With a return rate of 71%, you would have to win at least 58.5 out of every 100 bets in order to break even and start returning your investment. Other digital options providers offer you far better returns: at Dragon Options you will have a typical return of 75% on High/Low EUR/USD options, and OneTwoTrade’s return rate for the same asset is 85%, which significantly increases your chances of profitability.

Bet size & refund

Bet sizes: The minimum bet size here is $35, which is a bit steep, given that binary brokers usually start at $25 (TraderXP), or even $10 (iQ Option (www.binary24.de/broker-vergleich/iq-option). At BDSwiss (Review here: http://www.binary24.de/broker-vergleich/bdswiss) you can place a bet for as little as $1. The maximum amount you can place on a single bet is $1,500. Refund: If you lose a bet (e.g. the option expires out of the money), you automatically get a refund of 4% credited to your balance. Whenever brokers offer such refund, its amount usually ranges between 1% and 10% so TradersRoom’s cashback is about average.

Account Types

Depending on your deposit, with TradersRoom you can sign up for a Bronze, Silver or Gold account:
• Bronze: $250 – $999. With this account type you will be getting a monthly call/chat with an account manager.
• Silver: $1,000 – $4,999. Silver account holders will get a chance to talk to their account managers once a week, and they are also entitled to special bonuses.
• Gold: $5,000 – $20,000. If you have a Gold status account, a personal broker will be calling you every day. I would probably get really annoyed but hey – that’s probably what TradersRoom considers to be good customer service. Apart from that, you’ll be eligible for bonuses and priority withdrawals.

Option Types

High/Low: Also known as Put/Call options, these are the most popular options you can bet on. The basic principle is simple: you place a bet on whether the price of a value (NASDAQ or Gold for example) will go up or down. Then you wait for the option to expire and if you have guessed right, you collect your winnings. If the option goes opposite your prediction, you lose the bet and get a refund. The expiry time for High/Low options on TradersRoom is 10 minutes.

60 Second: These are pretty much the same as High/Low options but the expiration time is 60 seconds instead of 10 minutes.
One Touch: That’s an option type that carries high risk and low probability of winning randomly, and that is why it offers a super high return of 400%. If you don’t just gamble but bet after analyzing the market, you may give these options a try.

Here’s how they work: you have a pre-set level and you need to guess whether the asset’s price will reach that level. In case it does, the option is settled immediately and your profit is added to your account balance.

Deposit and Withdrawal

To start betting on TradersRoom, you would have to make an initial deposit of at least $250 and you can do that via bank wire or credit card (all major cards are supported).
Withdrawals are possible through credit cards, wire transfer or check (keep in mind that while the others are processed free of charge, for check withdrawals you will have to pay a fee of $10). The minimum amount to be cashed out is $100.


TradersRoom offers deposit bonuses and daily promotions but you would need to contact the customer support to find out more about these. Generally all the broker’s bonuses come with a release condition: in order to redeem the bonus, you would need to wager 15 times the bonus+deposit amount. Find under www.binary24.de/ratgeber/binaere-optionen-bonus-angebote a full list of all bonus offers.

Overall Impression

TradersRoom is an average Joe when it comes to binary brokers: it doesn’t offer any special features, the returns are low and despite my numerous attempts, I couldn’t get in touch with the customer support. There is nothing to make me choose this broker over another one.

TradeStation Presents Election Performance Indicator

With the US presidential elections around the corner, and campaigns in full swing, TradeStation, the company which acquired IBFX in 2011, is releasing an Elections Performance indicator – a tool that illustrates the stock market performance for each US presidential cycle since 1924.

The indicator plots the cumulative stock market performance on a monthly basis during each 4-year presidential cycle. The closing price of the January monthly bar following an election year is used as the starting baseline performance price, and at the end of each presidential administration cycle, the indicator draws a vertical line, and displays the stock market performance for the respective cycle as a percentage. If you are into long-term stock analysis which is based on external data and factors, then you can definitely benefit from the Elections Performance.
The only downside is that it can’t really predict who’s going to win the next elections – and if it could, it would save both Obama and Romney a ton of money and bad-mouthing. Just kidding. Ah, the drama of politics…

The indicator is built in EasyLanguage®, TradeStation’s proprietary programing language, and is available for download for free on www.binaere-optionen24.de. “In view of the upcoming election, we thought it would be interesting to examine the stock market’s long-term historical performance under various presidential administrations,” said Michael Burke, TradeStation’s Vice President of Client Training and Education. “TradeStation is an excellent tool for these types of studies, allowing you to create statistical or data-mining projects to measure performance on just about any market idea or concept. We offer a number of pre-built economic data sets – including interest rates, economic indicators and market statistics – that are kept up to date on the TradeStation website.”