How to Trade Binary Options

The focus of this article is on how to make money from each of the binary options contracts that are found on all the platform types in the market. These contracts include the following:
1) Call/Put binary option
2) Boundary (In/Out)
3) Touch/No Touch
4) Short Term binary options
5) Options Builder
6) High Yield (Touch and Boundary)
7) Run bet options
Here we go.

Trading the Call/Put Contract

The trader should select the Call/Put binary bet (also called High/Low, Up/Down, etc) on the trading platform and click on the asset to be traded. The selection is made on whether the asset will end higher or lower than the market price, and the expiry is chosen. The money to be invested is entered in the space provided for it.

When this has been done, the expected return on the binary bet for an “in the money” outcome is displayed. The trade is executed when the trader clicks BUY. If the bet is successful, the initial investment amount and the profit is paid into the binary trading account.

Trading the Boundary Contract

For the In/Out binary contract, the trader clicks on the “Boundary” tab. A selection is then made of either the “In” or the “Out” option.

The investment amount is then entered into the space provided, after which the binary trade is executed by clicking BUY.

Trading the Touch/No Touch Contract

The Touch/No Touch binary contract depends on the price action touching or not touching a price level set by the trader (e.g. on Betonmarkets) or by default (on OptionFair and 24Option). This involves deciphering the bet direction and then picking a price target along the path of the predicted price movement.

The asset to be traded is clicked, and the selection between the Touch or No Touch is made. The expiry time is chosen, and the trade amount is input into the space provided, after which the trader clicks on BUY. The return on the bet is shown.

Trading the Short Term Options

The Short Term contracts include the 60 seconds bet as well as the 2-minute and 5-minute contracts. Once again, these are all Call/Put trades that are only separated by their expiry times. The same process is used in setting the trades as for the Call/Put contract.

Trading with the Options Builder

The Options Builder is the Call/Put contract that allows for customization of the expiry time, according to the time on a 24-hour clock. Here, the trader can set the “hours” component from 00 hours to 23 hours and the “minutes” component from 00 minutes to 59 minutes. So if a trader intends for a trade to end at 1438hours local time, he can set this using the Option Builder.
This is the bet of choice when the trader wants more control over the expiries in a Call/Put trade. This contract is popular with brokers who use the SpotOption brand.

Trading the High Yield Options

There are two high yield option bets in the market. These are the One Touch and the High Yield Boundary trades.

The high yield boundary contract is used by several brokers in the market, and fixes the market price in a range. The trader is to bet on if the price stays range-bound (IN), or breaks either above or below the range (OUT). After choosing the instrument to trade, the choice is made between the IN or OUT option. The trade is rounded off by clicking on the BUY button for trade execution.

The One Touch contract follows a similar pattern. A choice is made from the Touch options tab, and the high yield option selected. The rest of the process follows the other trades. The One Touch bet is only available on weekends and expires in a week. A successful bet means big money for the trader.

Trading the run bets is an extremely speculative form of investing. Lasting only for a short time, the contracts promise good money for betting on them. However, it is very hard to win with them and they are best avoided.