Forex or Binary? Binary or Forex? What’s better? What is the difference?
Have you ever asked yourself the questions given above? I’m absolutely sure you did.
Now, it’s time to see the specific difference, pros, and cons of these two types of trading.
Forex trading is one of the first trading sources which appeared on the contemporary market. Forex is a trading system that involves initially foreign exchange( trading on currencies). You can become a part of a vast trading family by investing a sufficient amount of money according to your profit interest.
When we talk about Binary Options, we do not actually buysell assets we only predict if the underlying asset will go up and down in value. Therefore if your prediction is correct you win. You can predict the move of currencies, stocks, commodities, indices and thoroughly any investment with a volatile value.
TIME AND PROFIT
Where can we get more in the forex market or in binary options?
If we talk about the short time-scale, all the advantages on the side of the binary options. For example, acquiring an option for $ 100, you can almost instantly (in the case of winning) receive another $ 60-80 profit. Minimum execution time – 1 minute. On forex during this time, as a rule, you do not earn even one dollar, because when you play with a small deposit you will need a move of the prices on at least 50-100 points to earn at least something.
It does not matter what distance the price took because it is enough to change even by one point, the trader, who guessed right direction, will receive a well-deserved profits. In the forex market, the income is generally calculated and based on the number of points on which the price has changed, and each of them brings additional income.
Trading in the Forex becomes more profitable than options only at long time scales and larger lots. If the price has changed in a few months to a few thousand points, and the trader opened a position for a large sum, he can get a lot of money. However, it is the destiny of those who are in a hurry and who has both experience and money to invest. For beginners, trading with binary options looks more attractive, because it allows you to earn a lot more.
As you might guess, most of the profitability means high risk. In the case of risk, binary options system wins. Especially in the case if you’re trading in very small time intervals.
The risk when trading binary options is higher than in Forex for another reason. Namely, the binary options trader in most cases unable to close the deal in advance, if he sees that the price has gone the wrong way to lose less. Trading forex can always do this for example if he made a bet that the price will reach the level of 1.5030, and it went down to 1. 4580, he may close it right at this moment, without waiting for price drops lower.
EASE YOUR WORK
It can be said that the trading process of binary options itself is much easier and simple. You do not need to place orders (which are an integral part of classic trading in the forex market) and do calculations. You do not need to think about the point of the exit from the market if the price does not go there and look for the level of minimum losses. It is not necessary to decide the question about the movement of orders if it turned out that the price has gone up, and you want to make the highest profit. You simply buy the option and wait for it to pass. That’s all. No further action needed.
At the same time, this does not negate the need to exactly analyze the market, calculate, on how many points and how long should the price rise or fall, so you can know exactly what your option will be exercised. In this sense, there is no difference between forex trading and options, because the law of the need to conduct the deepest analysis to get a good result needs to be performed both in forex and binary.
As for the principles of trading, they are identical.
Firstly, every trader who came to actually earn on forex or options must trade by his own trading system from the outset. Only, in this case, we can expect that the trader will win and gain experience, grow professionally in the course of trading.
Secondly, any novice trader should immediately start learning technical analysis and learn at least basic levels to understand how to predict the behavior of the graph based on the support and resistance lines, topping figures, configurations of bars and candles. Calculating skills are also useful, where and how far the price will go. Only after learning all these points, you can start trading and expect that you will get a good result.
Finally, trade – this is a trade, not a game for luck. In this regard, it is not necessary to believe the propaganda of this or that market, which often promise huge earnings immediately. If you want to earn a stable profit and not an easy winning of a deal by chance, you need to have a sober calculation, do not chase the windfall and make your bets based on what you actually see on the chart and on the market. In this case, you really will be able to earn something, and most importantly – start earning stable, which is the most important feature of the trader, who can claim to be a professional.
On the Forex market, the trader most important thing is to choose a company partner, which clearly makes payments and do not deceive customers. However, in the binary options market, it’s different, binary options brokers offer very different trading conditions, different types of options available. It is not the same set of underlying assets. So, don’t be lazy, take your time and read reviews from the clients, and brokers reviews prepared by our author’s.
Now, let’s make it clear once again. If you have enough money and time, skills and experience – forex trading is definitely for you.
And if you’re a newbie who wants to make a fast profit then choose Binary Options.