Ninja Trading

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At first glance binary options trading seems like a risky way to potentially generate large returns, and if you refuse to dig a little deeper this would be an accurate statement. However, for those that choose to take a deeper look, one would find that by utilizing a disciplined binary trading system you could swing the odds of profitability in your favor. Those that are serious about dedicating the time and energy into creating and implementing a steady binary options trading system should place these 5 items at the core.

Step 1: Concentrate on a Small Set of Assets

Instead of jumping from equities to currencies to indices and back again based on what’s hot, focus on a handful of names and get to know them on a more intimate basis. I’ve been trading options for over 10 years now and one of the early lessons I learned was to not worry about all that may be happening in the world, in other sectors, in other names, it can be an time-consuming task. However, if you select a few assets to follow you’ll more than likely gain a better grasp on how they move on a day-to-day basis. This should be extremely helpful when trading binary options. Fortunately (or unfortunately depending on how you look at it) the binary option broker platforms in the market today have a limited number of names to trade, thus picking a few to focus your trading efforts on should not be that difficult.

Step 2: Select A Binary Option Broker

There are several binary option broker platforms currently available, all with unique defining characteristics. The most well-known binary options broker is EZ Trader. EZ Trader is an excellent platform for binary traders interested in trading options on US based stocks. EZ Trader has the largest selection of US based stocks amongst all binary option platforms. OptionBit can best be described as the low cost binary options broker, with initial deposits of $50 and minimum trade size of $10. StartOptions is another choice, most known for its practice account allowing traders to paper trade binary options. With many platforms available make sure you check out these highlighted brokers and pick the ones that best suit your investment style.

Step 3: Implement Your Binary Option Strategy

One of the more common mistakes we see traders make when starting to trade binary options is they get attached to a couple of ideas and live or die with their outcomes. This is not a good strategy. This kind of strategy will more than likely leave you with an empty trading account in short order. The goal should be to give yourself a chance to win by trading several times a day, sometimes trading multiple times on the same option within the same expiration. If you only trade a few times during the day there is a very good chance that you’ll finish the day down or possibly flat. However, if you trade multiple times during the day you theoretically increase your chance of winning. With no fees for trading, there really is no obstacle to placing as many trades as you like. Most successful binary option traders make at least 10 trades a day.

Step 4: Manage Your Risks

No question binary options trading is inherently risky. Most brokers will offer average returns of 70% for winners and a return of capital of 5-15% for your losing trades. The odds do not seem to be in your favor. The risk profile of placing one trade and hoping that it ends up “in the money” is not a profile we like. That is why we rarely place one binary options trade on a given name without following it up with a 2nd complementary trade prior to expiration. This 2nd complementary trade can be a purchase of another option in the same direction, a purchase of another option in the opposite direction, or a purchase of another asset completely, playing the correlation between the two assets. There is a multitude of ways to structure trades that can decrease the risk inherent in purchasing one binary option. We review these various strategies we use to profitably trade binary options in our weekly report, the Binary Options Weekly.

Step 5: Signup for the Binary Options Weekly Report

As mentioned above, we publish a weekly report covering all aspects of binary options trading. The Binary Options Weekly is a FREE weekly report consisting of tested strategies, hedging tips, binary option broker reviews, trading summaries, and a calendar of stock specific and macro catalysts on the near-term horizon. You can subscribe to the Binary Options Weekly Report by visiting DerivStrategies.com and providing your name and email address in the signup box in the upper right corner.

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