Trading 60-second binary options has become increasingly popular due to the potential to make profits within a short period. As the name suggests, this type of trade offers a contract that expires in one minute.
Step By Step Guide to 60 Seconds Binary Options Trading
Although there is a potential to make fast profits, money management is a prerequisite if you were to alleviate the potential losses.
How do trading 60-second binary options work?
60-second binary trading works just the same way as trading other types of binary options. If you believe that the price of an asset will go up within the next 60 seconds, you would purchase a call option. On the other hand, if your prediction were that the price of an asset would decline within 60 seconds, you would buy a put option position. It is worthwhile noting that the 60 seconds start the moment you execute your trade and end exactly on the sixtieth second.
The underlying argument is that predicting the price movements correctly will determine the profits the trader receives. Different traders offer different payout amounts in addition to the premium you invest on your trade. In the same vain, an incorrect prediction of the price movement will result in a loss of the investment you made.
What are the advantages of trading 60-second binary options trading?
Executing 60-second trades essentially means that you can make hundreds of trades in a day. The short trading duration allows you to execute multiple trades and to maximize your chances for making substantial profits.
Unlike trading binary options with longer expiration periods, sixty-second trading allows you to leverage strong price movements, thereby increasing your potential to make profits. With this type of trade, you can take advantage of the market trends and exit the markets before the trends start to reverse.
Although there is an opportunity to make substantial profits, there are some downsides to trading 60-second binary options. First, the high potential to make profits is accompanied by an equal potential to incur losses. A major mistake that traders make is to overtrade in an attempt to take advantage of multiple trading opportunities.
The problem with overtrading is that a trader is likely not making high quality trades that could result to profits. The truth is, to execute a good trade you will require proper insight and a solid strategy. Poor set-ups that are done too fast certainly increase your chances of incurring losses.
Another downside of trading sixty-second binary options is that the payout is typically lower than in other types of binary options. So, while other types of binary options have a payout in the range of 70% to 80%, 60-second binary options attract a payout in the range of 60%. To make substantial profits at the end of a day of trading, it is important to have a high rate of wins. There is a high probability to make substantial gains by leveraging short-term expiry periods. However, avoid overtrading and instead focus on executing high quality trades to increase your odds of winning.