The goal is straight forward. You want to add more money to your portfolio (or bank account) without too much risk.
Traditional stock market traders have to focus on the price movement of stocks. They understand that stocks have regular cycles where the price falls and rises between two points. Their goal is to purchase the stock near the cycle low and sell when its price is near the cycle high. Then to repeat that cycle over and over and use the gain as income.
You will need to anticipate the expected direction of the price movement of the underlying asset. Unlike traditional options, knowing the direction of the price movement, as well as magnitude of the movement, is not required.
There is a reason that binary options trading has become so popular in recent months. One reason is the current economic downturn. The other reason is because anyone can do it! You don't need to spend hours each day studying stock trends and corporate acquisitions. For as little as $5 dollars you can place a trade.
But don't let the low price of entry fool you. Binary options trading can return some of the highest payout rates. You could get as much as 85% on options that expire in the money. In some cases, with the right training it is possible to achieve a 700% return on your investment.
You can visit a binary options trading platform and process the transaction yourself in a matter of minutes. Not needing to involve a broker makes this simpler and cheaper! But remember you can either earn a high return on the binary option if it ends up "in the money", or you lose the entire investment. This is why it is referred to as 'all or nothing' trading.
Binary options trading can provide you with an easy way to trade forex, stocks, indexes and commodities. Before investing in a binary options, make sure you understand the underlying asset, are familiar with the relevant financial markets and where the asset is traded. Unlike a traditional option, the payout amount is not proportional to the amount by which the option ends up in-the-money. If your trade settles in-the-money by even one tick, you receive the entire fixed payoff amount. (Remember, any investment carries risks. Seek the proper advice before investing money).