Choosing the right expiry in Binary Trading

Everyone knows that binary options are way easier to trade then the other forms of financial alchemy. We are not talking about the ease of accessibility here. Results speak and say that binary trading is attracting more and more traders from their areas and into the world of binary. The most attractive thing about binary options is their account size. There is no need to create a margin account and margin calls. The next best thing here is the risk. Take an example of spot positions which let loose your account to unlimited losses. On the other hand there is very less risk to simple yes or no trade.

And here lies the reason why so many Forex and Commodity traders have switched to binary trading. If that is not enough for you to know the catch here then go talk about the delta, theta and implied volatility to any equity trader and it will give chill down his spine. After so much discussion about how easy it is to trade, be mind of the fact that its easiness is relative to other financial instruments. That means it’s easy to make money here then with other trading areas. One still have to make an effort in understanding the market and show good judgement. And when it comes to the hardest part then one can say without a doubt that it is the expiry.

 

Some tips

Expiry in binary depends upon the platform and the broker. As for the first form of decision that you will face with the expiry would be to go long term or short term. Next will be how to determine expiry relative to time of purchase. By that we mean is it set at some fixed future date or does its time depend on your purchasing date.

Let me explain: Take for example I made a purchase at the start of the month and my expiry is fixed at the end of the month, in case of an end of month expiry, then I have a time of 30 days to the realisation of my money. If however I made a purchase on the 25th of the month I will have 5 or 6 days with me. This same thing is also true for short term expiry. An end of day expiry will have 6 to 7 hours of expiry time if you purchase it at the start of the trade. Most of the beginners in the trade aren’t aware of these restrictions on expiry times.

Choose the right expiry time based on your own strategy

binary_option_009The important thing is to understand your strategy and tie it all together. Your expiry time will wholly depend on your strategy. While trading day signals having an expiry before the end of the day you will not need long term expiry. Traders can use these tricks to pinpoint expiry times using charts. This is the most useful tip for a technician. Tell them to check back their charts, every detail including decline, correction, rally and every trading range until you get that final feeling of where the movement of your asset is going.

Don’t be worried about the size of your chart. Be it a day or a year chart. Measure your chart in different time frames. That is how you find out all the signals you would want to trade. Measure the movement of candle sticks required to move the asset and then take an average of that. This final figure will tell you how to choose your expiry. Also make sure that it is employable on your platform.