Pros and Cons of Options Trading
You can regularly find messages on the Internet forums from traders who switched from Forex to option trading. Most often, phrases such as: “Everything is simple, clear.” Indeed, options are much simpler: either lose or earn, but this is a trick for amateurs.
An option transaction is nothing more than guessing the price movement. The trader does not control the situation, cannot close the position sooner or later than planned, with various market disasters.
Tempting simplicity and “tied hands” are the main disadvantages of option speculation. However, it is advisable to start exploring the financial market from them, and then move on to Forex or stock exchanges (not vice versa). For the Binary Option helps to shape trading discipline at the expense of one weighty advantage – a predetermined amount of profit and potential risk. As you can see, weaknesses are balanced by strengths.
The minus of the Binary Options also lies in the difficulty of predicting price movements: in addition to determining the objectives of the movement, one must also take into account volatility and other parameters (in order to manage to “fit in” the time interval before the expiration date).