Binary Gambit is a binary options trading strategy for important news. Like all others, it has its advantages and disadvantages. She has her fans and opponents, which is largely determined by the character of the trader. Let’s try to figure out what kind of strategy it is, what kind of results it can produce and to whom it suits.
Trading on the news
Trading on important news has its own characteristics, which attract some traders and scare others away. Its characteristic feature is increased market volatility, which can bring both high profits and large losses. On particularly important news, the price can change by tens of points per minute, which in a normal situation has to wait several hours. It is not surprising that traders who are looking for any useful information on how to make money on binary options try to learn how to trade on the news in order to get the maximum profit in the shortest possible time.
News comes out almost every day, sometimes 2-3 times a day. Each broker has a page with a calendar of events for the day and week, where the news is marked with one, two, three stars or other icons. The more icons, the more important the news - serious price movements are usually given by news marked with three icons. One of the most important is news on the number of people employed in the US non-farm sector, Non Farm Payrolls. Traders call this news "Non Pharma", it comes out every first Friday of the month at 15:30 Moscow time. On the price chart, this moment stands out as a strong surge.
The essence of the binary gambit strategy
Before the release of important news, the trader must conclude two transactions: for buying and for selling. That is, in one or two minutes, Put and Call options with the same amount of investment should already be bought. For example, the minimum allowable amount to buy an option from many brokers today is 30 rubles, and many beginners start with it in order to minimize losses in the learning process. We immediately buy a Call option for this amount and Put. At the same time, we expect that the price will fly sharply in one direction and the corresponding option will bring us profit. But the opposite option will bring loss, where is the benefit? Yes, but the loss is much smaller than the profit if you chose the right broker (more on that below). For this reason, trading with the "Binary Gambit" strategy is not possible for all brokers, but only for those that meet certain requirements. The final profit will be the difference between the win on the first option and the loss on the second. Let's look at a specific example for an investment of 30 rubles.
Case Study
Suppose the premium on the option is 80%, in this case, the gain will be 80% of 30 p = 24 p. Losing the second loss-making option depends on how quickly we close it - the faster this is done, the lower the loss. Suppose we closed a loss-making option after one minute and the loss on it amounted to 20%, which is 6 p. That is, the total gain was 24 - 6 = 18 p. or 60% of the investment amount. It is clear that if we bought an option for the amount of 1 million, then the profit would be appropriate - the numbers are different, but the essence of the trade is the same. Each broker has specific premiums and loss amounts, they must be carefully studied and the most profitable options found, since even with the same broker interest and loss rates may differ on different assets (currency pairs, stocks).
Advantages and disadvantages
The Binary Gambit strategy attracts primarily by its simplicity. No need to do serious market analysis, which can take several hours in a row, professional skills and knowledge are not needed. Indicators also relax while we trade on the release of important news using the Gambit for Binary Options strategy. Even a person who is far from trading can start making money right away - just understand the technical side of the issue. This is an absolute and big plus.
A profitable strategy for a long period of time, if you do not change the amount of investment. It will not give 100% result - such systems do not exist in nature. That is, it will not be possible to do without losses at all, but in the long run the result is stably positive, albeit small. This strategy may well serve as a guide for those who do not yet know how to make money on binary options.
How can it be, you ask, because the system seems to be a win-win - the price will certainly go one way or the other, that is, up or down. This is the main minus of the strategy - unfortunately, the price does not always go only in one direction. Very often, especially in the summer, when the market volatility falls slightly, the price of the news makes a few seconds in one direction and then the other, leaving traders only to regret their losses.
After the expiration time - for the trading system in question is 15 minutes - the price returns to the point from which it started. One of the options will still win, because there will be a difference by at least one or two points. But in this wild whistle, when the price just flies here and there, it’s unrealistic to understand where it will stop. Therefore, it is impossible to understand in time which option will be profitable and which should be closed. As if watching a ball on a roulette table. The final result in such a batch will be unprofitable, however, the loss will be less than the profit in the normal course of the price. Due to this, in the long run, the strategy still gives a positive result.
Another problem when trading on this trading system is slippage or requotes, which is essentially the same thing, although it differs slightly.
Requotes and slippage
Requotes and slippage - the inability of the broker to process user orders due to too fast price movement. Let us explain this in relation to the strategy considered in the article. You bought two Put and Call options with an expiration time of 15 minutes. The news came out, which caused an abrupt price movement down. So, the Put option turned out to be profitable for us, and the Call - unprofitable, and we need to close it, the faster, the better, what we are trying to do. But while our order reaches the broker, the price has already changed (remember the huge volatility). And the order cannot be executed at the price declared by us initially.
Information about this comes back to us with a proposal to close the option already at a new price, less favorable. While we agree and inform the broker about this, the price has again gone. This can go on for quite some time (on the scale of news trading) - up to several minutes. By this time, the loss on our Call option may come close to the size of the premium on the Put option and the profit will be minimal, if at all.
A logical question arises whether it is worth using Binary Gambit in trading and how to trade if the broker does not provide such an opportunity. The answer is simple: you need to choose the right broker and connect only high-quality high-speed Internet. The trader should not save on this if he wants to work professionally.
The mathematical expectation of strategy
For the reasons described above, the Binary Gambit strategy does not give 100% results and the profit on it is quite modest. If you are promised and guaranteed a profit of 500% per week, this will be a deliberate lie. Such a percentage of profit, most likely, will not give any strategy. A good result among traders is considered to be a small but stable result. The "binary gambit" meets these requirements. In the long run, it still turns out to be profitable, if you do not change the amount of investment.
How to choose a broker
Only in the Russian market there are at least a hundred Forex brokers and binary options. How to choose the right one from them? Leave aside ethical issues (reliability, payouts) and focus on the technical side. You need to choose a broker that allows the early repayment of a loss-making option with a minimum amount of loss. Without this condition, trading under the Binary Gambit system becomes simply impossible.
Strategy Reviews
On the network you can find different opinions, but they have some common points. So, many traders, more often beginners, remain disappointed with a small percentage of profit compared to what they were promised. Real profit, judging by the reviews, ranges from 20% to 40% per week. Almost all traders are unanimous in the fact that if you strictly adhere to the rules and the amount of investment, then a deposit can not be drained, which can already be attributed to the undoubted advantages of the system. Often in reviews of the "Binary Gambit" they mention the simplicity of a strategy that does not require special knowledge and long training.