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Stock Binary Options

Trading stocks can be very tough, especially if you are just starting out or have a limited bankroll. To trade effectively, you need to be able to engage in selling stocks short, and this requires a margin account with a reputable stock broker. The minimum amount that you need to open such an account is $10,000. This keeps a lot of people away from the stock market, and those that do enter with less money than this will find their choices severely diminished. And when it comes to actively trading, the more choices that you have, the better off you will be.

This is where stock binary options come into play. By definition, binary options are really easy to understand. You simply need to choose from one of two options: do you think the price of the asset will go up or down? Binary options present a sense of freedom with this, since you don’t need to assume the immense risk of selling a stock short. When you trade binary options, you know and agree to precisely the amount of risk that you feel comfortable with. Like traditional stocks, you can choose how much or how little you want to initiate the trade for, but unlike stocks, binary options will always tell you beforehand how much you can earn and how much you stand to lose. These are stated and agreed to before the trade even begins, giving the trader an advantage that they won’t see in the stock market.

There are other advantages to trading stocks through binary options. You don’t assume any ownership of the stock at any time which decreases your liability. You also will find that your asset choices will take on a new diversity. With binary options you can trade the major U.S. stocks, but you will also have access to foreign stocks, too. This will save you quite a bit of time and energy since you will not have to change brokerage sites in order to take part in each of these distinct marketplaces.

A third big advantage is that you are not limited to just stocks. This won’t appeal to all traders, but the market pull effect concept can prove to be very beneficial to traders, even if they do not know a lot about trading with other classes of assets. For example, if you see that Exxon’s stock is moving steadily upward in price, you can assume that this will have an impact upon the commodities market, namely crude oil. By strategically timing your trades, you can double your profits by trading both Exxon’s stock and oil through binary options. Remember, assets do not move in a vacuum—even seemingly different assets. The movement of a stock can impact other stocks, indices, and commodities.

Plenty of Stock OptionsThe market pull effect can even impact currencies. For example, if you see that there are many Australian stocks rising in value, but the major U.S. stocks are falling, you can safely assume that the USD/AUD currency pair will start dropping in value as the United States’ dollar becomes less valuable than the Australian dollar. Little things like this can jumpstart your profit making ability and give you a big advantage that you cannot find in the domestic stock market.

Stock binary options lower the bar when it comes to ease of entry, allowing more people to trade for cheaper. You don’t need $10,000 to start trading here. With as little as $500, you can start trading binary options on the vast majority of sites, and you will have a lot more freedom to trade how you want to. Binary options aren’t for everyone, but they do provide a very good tool for the average person.

Risk Disclaimer