Binary options (BO) is one of the most popular trading tools. They are a contract under which the investor will receive money if he anticipates the movement of prices. The subject of the transaction can be any asset: stocks, currency pairs, indices, goods. In theory, the strength of the price movement does not matter, only the direction is important. Read more about what Alpari binary options are and how to use them, read on.
Essence
Consider a simple example. Deutsche Bank in July 2014 announced a decrease in net profit of EUR 100 million per quarter. The day after the news came out, stocks began to be sold, which led to a drop in quotations. By tracking this trend in advance, a binary options trader could buy contracts on a falling price basis and multiply their initial deposit several times over a trading day. This example shows well how the BO works. If the trader guesses with the direction, he receives money, if not, he loses.
Binary VS Traditional Options
These two tools only have a similar word in the name. The table below allows you to clearly demonstrate the differences between them.
Indicator | BO | Vanilla options |
Contract term | 1 minute to several weeks | Once a month |
Pay | Fixed | Depends on purchase price |
Profit | Depends on the direction of travel | You can only use an option with a correlation of its market and real prices. |
Right to purchase | With any asset | If the option is profitable, you can use it to purchase shares |
Alpari Terms
- Deposit and withdrawal through WebMoney.
- Min deposit: 10 USD.
- Min bid: 5 USD.
- Expiration period: 3-60 min.
- Bonuses: up to 50% on deposit.
- The maximum yield is 89% for Alpari (binary options).
- Demo account is provided without registration.
- Specifications: Alpari binary options can be bought on currency pairs and goods (gold, silver). Trading stocks, futures and indices will not work.
- Market analytics is available to traders directly from the platform window.
- Support service is open around the clock.
- There are no commissions for withdrawing funds.
- Refund: up to 20%.
Alpari Binary Options: Trading Benefits
- Management of risks. When making a bet, the trader knows in advance how much money he will gain or lose at any outcome. The broker does not charge additional fees.
- Not an asset is bought, but a contract. This allows you to overcome price barriers.
- Maximize revenue. Depending on the terms of the transaction, the profit in the event of a win will be 71-85%. Among all the available instruments, the most profitable are binary options “Alpari”.
- Trading strategies are similar to Forex.
- Convenience. All transactions are made online through the platform. You can download the program on a PC, smartphone or use the online version.
- Contracts are accepted for execution 24 hours a day (on weekdays).
- The deadline does not exceed several hours. Traders with small deposits can conclude several transactions per day.
- A demo account is opened for free immediately after user registration.
Time matters
Alpari binary options have several names: digital, twofold, "all or nothing." The essence of the instrument does not change from this. It is necessary to determine the direction of the price movement, choose the time of expiration (completion of the transaction) and purchase a contract on the appropriate terms. There are brokers who provide derivatives contracts with a deadline of one minute. Others rely on long-term transactions (from a few days to a month). The most popular are fixed-term contracts with an expiration period of up to one hour. These are exactly what the Alpari broker offers.
How to trade binary options? It is enough to select the type of asset in the OptionTrader platform, the time for completion of the transaction, and press the PUT or CALL button. In case of a win, the trader receives his initial deposit and an additional 70-85% of the profit. If the direction of movement turned out to be different, as a compensation, the broker returns to the trader up to 20% of the deposit.
Example
The trader assumes that the EUR / USD ratio will increase in 30 minutes relative to the current value. He gains an Up / Below Upgrade Contact (CALL) for $ 5. Current value: 1.35. By the time of expiration, the ratio was 1.4. The trader was right. As a result of the transaction, the broker will pay him: $ 5 + 5 x 0.7 = $ 8.5.
At Alpari, binary options trading does not take much effort. It doesn’t matter how much the financial asset changes - 10, 20 or 50 points. Only the direction of movement matters.
Kinds
A trader can choose one of four types of contracts:
1. High / Low: if at the time of expiration the price is higher (Call) or lower (Put) of the current level, the trader will receive income. These are the simplest types of transactions for which a minimum reward of 70% is provided.
2. One Touch: the trader will make a profit if the price touches one of the proposed levels when it increases (Call) or decreases (Put).
3. Range High / Low: the trader selects a range above (Call) or below (Put) the current price. If at the time of expiration the contract value is within the specified limits, a fee will be paid.
How to make the right choice
Beginners should start with the classic “Up / Down” options. These are the least risky and easy to understand tools. For the period of studying the platform, it is not necessary to invest all available funds in Alpari (binary options). The minimum deposit at the broker is only $ 10 (against $ 250 from competitors). But at a rate of $ 5, these funds will be enough to complete at least two transactions. Those who do not want to risk their own funds at all can first trade on a demo account. Alpari provides it for free with a full range of functions, while other brokers allow traders to "train" with the platform only after making a deposit. Another good news: the user can choose the balance of the virtual account on their own. After gaining experience in using the terminal and skills to determine when to enter the transaction, you can try other options.
The next step is choosing the right trading strategy. It depends on the timeframe, asset and expiration dates. The most popular are scalping strategies for 60 seconds. But, firstly, not every broker provides the so-called turbo options (with an expiration time of one minute). Secondly, we must not forget about the technical features of the process. All transactions are carried out via the Internet. No one is safe from interruptions in the provider's network. Each self-respecting broker, before accepting the contract for execution, will ask the trader to confirm his intention. If no feedback is received within 5 seconds, the contract is accepted for execution. If the expiration period is at least 5 minutes, significant changes in price should not occur. But if the transaction is registered for 60 seconds, then from the moment of filling out the application until it is accepted for execution, the price of the contract can change greatly. Whatever strategy you choose, it is important to remember the main rule of risk management: do not invest all funds in one asset.
Platform
Most brokers provide the opportunity to trade online. This is not always convenient. It is impossible to put indicators on charts or build support-resistance lines. Advertising often appears in the program’s working window, which interferes with analysis and even transactions. Therefore, it is better to use the desktop version of the software. OptionTrader is a platform designed specifically for BO trading. It is enough for the trader to download and install the application, enter the data of the trading account - and you can start trading. There is a separate version of the program for smartphones and tablets.
Automation of trade is facilitated by a system of copying profitable transactions. The trader independently decides whether to connect his terminal to the duplication service of trade orders. Other customers through "My Account" can join experienced players. Transactions made by a successful trader will be copied to the accounts of other players.
Alpari binary options: reviews
The first thing worth noting is the regular payment of earned funds to a bank account and Webmoney wallet. Some brokers refuse to withdraw funds through electronic payment systems, explaining this by the fact that they can not identify the user. Experienced players are advised to work through the bank. To withdraw money, you need to verify your Alpari account (binary options). User reviews say that no broker will send money for unverified details. For verification, it is necessary to provide a scan copy of the passport or rights, a paid receipt with the address and photo of the front side of the card to which the transfer will be issued.
A special platform has been developed for trade in BO. It is very different from the classic MT4: it lacks tools for analysis. But you can still get used to it. A great advantage is also the Russification of the platform.
Real reviews of Alpari binary options confirm that trading only short-term contracts is inconvenient. There are tons of long-term strategies. Transactions with expiration in 3-5 minutes may be of interest to professional traders. Beginners in the period of development of the platform usually place bets with expiration in a few hours.