The trading game is constantly growing and changing in this fast-paced online world.

There are more ways to start trading now than ever before and it could easily be considered the best time to trade. One of the newer instruments for interacting with the marketplace are the different binary options. These have only been available to the public since around 2008 but have seen rapid and extensive growth all around the world.

Ideal for new traders, these options are relatively simple to learn and can be very profitable if done right. Binary options Uganda has access to can be great tools for understanding the market and developing experience for trading. There is also a notable entertainment value in these sorts of options, their simple structure and wide variety can cater to any situation.

Understanding the Binary Trade

The reason they are called binary is because they fundamentally have just two possible outcomes.

The concept behind binary options is straightforward enough. The result from one of these trades results in either a win or lose scenario. This structure is different from most other types of trades but still run across these markets.

When dealing with a binary options broker, traders of Uganda can engage with any of the other markets. This includes the likes of Forex, commodities, stock indices and even cryptocurrency. The ability to engage with any market but still under the guise of binary options makes this a very useful entry tool to the greater marketplace.

The main factors that affect trades of this nature, apart from the fact that there are only two outcomes, is the time frame, the starting point, and the specific structure of the type of binary trade. There are several different types of these binary options but all of them involve a specified time frame with ending point and a specified starting value of the specific asset being traded on.

Another thing to consider about the structure of these trades is that there is a fixed payout attached to each one. Since there are only two possible outcomes, this return is always marginally lower than the investment made. While this is not as rewarding as other marketplace instruments may be, there are also less risks attached. With a binary option the maximum loss is the value of the investment placed.

What makes binary such an interesting marketplace to trade on is that there are a variety of different types of these trades. Each of them operates similarly, still with the aforementioned conditions attached, but instead have slightly different methods of completion and success. There are also other advantages and risks associated with these types of trades that should be discussed for the traders in Uganda.

The concept behind binary options is straightforward enough
The concept behind binary options is straightforward enough

Advantages of Binary Trading

There are a number of advantages to Binary Trading that encompass the entire experience. Let us breakdown the available benefits to using binary options for trading. There are quite a few of these so let us list them out one by one. A lot of these also depend on the software being used and how much legit services it provides.

  • Market Choice. The first benefit of binary is that it frees up the trader to explore the wide variety of markets and assets thereof. Like Forex, Indices and crypto, trading binary options enables access to these worlds and does so through their innovative and straightforward process. As an entry into the marketplace this makes logical sense as it provides an easy platform for which to learn about the other instruments and trading.
  • Easy to Learn. This has already been addressed but the value of it cannot be underappreciated. There are many different ways to connect and use the global marketplace, but binary is definitely the most simplistic of them all. For the beginner trader this makes perfect sense to pursue straight from the get-go. However, the more experienced traders will see that these options also hold value beyond their basic nature and are worth returning to often enough.
  • Multiple Trades. This advantage hinges on the fact that binary options are limited to a certain time limit and then autocomplete. This means that traders do not have to terminate or recall their trades in any fashion, instead they will complete and pay out, or not, when the time is up. This frees up a good deal of time monitoring the marketplace after a trade and instead allows traders to place further investments and research other assets they may want to invest in.
  • Risk Control. An appealing advantage of these types of trades is that they have a limited risk connected to each trade. Unlike other trades that can result in greater losses than the initial investment, binary is limited to just the investment. If the trade is lost, only this initial value is lost, no more than that. This limits risks associated with the marketplace often and allows a greater sense of freedom, especially for the newer traders.
  • Appealing Returns. Like with the fixed risk, there is a fixed return possible from these trades. The upside of this is that this return is very appealing in the relative size, especially given the fact that there are only two possible results from these trades. On some binary options that Uganda has access to traders will find that they can make profits of up to 90% of their initial investment. For the reduced risk, this is some of the best returns available for most every other instrument.
  • Broadly Accessible. When it comes to trading freedom, few other instruments provide the level of accessibility that binary options successfully do. These can be done at pretty much any time throughout the week, while others have to abide by the market times of the particular exchange. This frees up traders connecting to the global markets from anywhere, enabling them to engage whenever they are able.
  • Trading Variety. One of the most appealing sides of the binary marketplace is that there are several different types of trades of this nature. While they all follow similar guidelines and structures, these each have different winning conditions. This mild variety is great because it provides enough diversity to give a unique and new experience to the traders.

These factors are all part of why these types of trades are so popular right now.

Risks of Binary Trading

As great as these binary options are, there are of course limiting factors and risks associated with them. While these trades are fundamentally less risky than most other instruments, there are still some to take note of before getting started.

  • Reduced Odds. While the returns for binary options can be appealing, the risk is that the possible profits from them are less than the initial investment. For a trade that has only two outcomes, this is expected. However, depending on the chosen broker, there are some instances where this can lean toward making a loss. Where the traders make the difference is in the research they put into these trades, to accurately guess where the result will end up.
    Additionally, it is easier to make these estimations on these trades the more time is available. However, the return from these are pinned to the time frame used. So, the longer the time frame, the less return possibility but the easier it is to correctly predict the outcome. Traders from Uganda must balance these levels of risk and return to effectively utilise these options.
  • Managing Risks. Added to this, there are some brokers that will apply greater minimums to their binary option experience. These can greatly vary across the available brokers but in some circumstances these minimums can be excessively high, meaning that smaller trades are not feasible and instead they are forced to invest larger amounts. The problem is that the quick speeds and ease of use of these binary trades means that, with high minimums, the deposited amount can quickly be invested and potentially lost.
    Traders are advised to look out for brokers that can provide better minimums whilst also managing their trades and risks with these investment amounts. The more money invested, the more research and efforts should be put into these trades to keep the statistics in the favour of the trader.
  • Limited Options. While binary trading is a quickly growing industry, there are still limitations to many brokers and the offerings they attach to these trades. This includes a limitation in the presentation of the market, the various tools used to engage with these systems and sometimes the variety offered through this instrument. As the online world grows more entranced with these types of trades, this will lessen in its effect and more tools will be made available to accommodate this surge.

Even with these risks, the binary options available are still widely sought after and growing everyday.

Different Binary Trades Available

Binary Trading has a medley of different mechanisms that essentially provide the same win or lose structure familiar with this type of instrument. 

These make exploring the market a little more interesting because there is an in-built variety involved.

  • High/Low. This is probably the most prevalent type of binary option. It is also the simplest one. Traders are tasked with predicting the change in a given value of a particular asset. They first select the time frame involved, which can range from just 60 seconds to all the way up to even a year. Once the investment is placed, the current value of the asset becomes the strike price. The objective is to then predict if the price at the end of the time frame will be higher, often called a call, or lower, often called a put.
Binary Trading
Binary Trading
  • One Touch/No Touch. This is much the same as the high/low option except that instead of the strike price there is a given price set either above or below the starting price. If the price of the asset touches this given price during the time frame then the bid is won, or lost depending on the way the broker frames these.
  • Range/Boundary. These are essentially two touch binary trades that have an upper and lower boundary. If the price stays in between this range or boundary then the bid is considered won. These are unique because they require a deliberate stability in the value, with support and resistance on either end, versus perhaps a one sided inclination.
  • Ladder. These trades are like the high/low variation, but they work in steps. This means that there are partial wins or losses available, essentially breaking down the simple binary option into stages. These are recommended for more advanced traders as the result is not entirely either or but also how much in that direction.
  • Pairs. These are binary options that work on a pair of assets. Instead of a high/low scenario, these depend on picking which asset will perform better than the other over the period of time chosen. This is still a relatively new form of binary but certainly one that is seeing some significant interest.

Different brokers will have different binary trades available, each with their own experience.

Trades Available
Trades Available

Strategies for Binary Trading

The truth is that binary options are some of the most affected by a good trading strategy. With only two possible outcomes, the more prepared and informed the traders are, the much more likely they will be to reliably predict the outcomes. Any strategy might as well be produced for dummies when it comes to this type of trade because they will all be designed for beginners learning how to trade.

To perform better in this, traders of Uganda and the world over can follow the news and the particular market they will be dealing with. There are also demo accounts that certain brokers will offer that can be used to practice and develop these strategies. These are generally free to use and can be harnessed to learn new binary trades and better understand the different markets. There are also tutorial videos to seek out and watch, especially through some of the top brokers like IQ Option.

Another good idea is to utilise the low minimum deposits and a broker that provides it. The lower the investment options, the more flexible traders can be with their trades, so looking out for a minimum deposit broker makes logical sense. They can make more of them, take bigger risks and ultimately lose less capital should they make mistakes or get unlucky. As tips and tricks go, this one is great because it acts as essentially free bonus money that can be used on the platform to aid their strategy.

Remember that building a strategy takes time, patience and a good deal of research.

Conclusion

Overall, there are many interesting aspects that binary options open. From the broad access to the marketplace to the simplistic nature of the trades themselves, there is something for every trader when it comes to binary options. One of the most important choices once one understands the binary market is picking the right broker and there are none better than IQ Option.

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