Binary trading requires basic knowledge, patience and common sense. In this article we guide South African traders through all the steps necessary to place a successful trade in binary options.
As always, we recommend trading only with regulated and trusted brokers such as IQ Option for added benefits such as a free demo account, $10 minimum deposit and only $1 minimum investment. For more brokers, see our broker page. Let’s get started.
What Are Binary Options?
Binary options are nothing else but a prediction of an asset’s price direction in a prespecified amount of time. The price doesn’t have to go too high or too low for traders to make a profit. All they need to do is predict whether the closing price will go higher or lower than the opening price as shown in the figure above.
If the price stays the same, then traders receive their investment back. If the trader predicts correctly, then the profit made can go up to 91% depending on the broker and the asset. On the other hand, if the prediction is wrong, then the trader loses the investment.
Example of a Binary Options Trade
Step 1: Register with a trusted binary broker
Registering with most binary brokers takes only few seconds. All you need to do is fill in the boxes with your email and a password. You also have the option to continue with your Facebook or Google account or simply fill in your personal details like name and surname.
Step 2: Practice with the free binary options demo account
Practice binary trading with a free demo account available to South Africans, before switching to a live account in order to get familiar with the binary trading platform. In this section there is a detailed explanation on how to place a successful trade with the legendary IQ Option platform. Once you feel ready you can switch to live binary trading which is done exactly in the same way as explained here.
To start with, traders need to select their asset from the drop-down menu as shown here. A large selection is available as always by IQ Option.
Set the investment amount
Then, set the investment amount as shown below by clicking on the amount box at the right-hand side of the trading platform. This can be as low as $1 so that novices can start trading with a low investment capital.
Set the expiry time for the binary option
Once the investment amount is set, traders need to select the expiration time. There are binary options available from 60 seconds to the end of the month as shown below. You can even see that the profit percentage changes according to the expiration time. Longer expiration times will offer lower returns.
Once you choose the option’s expiration time then, you can place as many binary trades as you wish.
Choose the direction you expect for the price in the future (Higher or Lower)
This can be done by choosing the price direction, either by clicking on the higher button if you believe that the price will go higher than the opening price.
On the other hand, traders can click on the lower button if they believe that the closing price will be lower than the opening one as shown here.
Wait for the binary option to expire
Finally, you wait until the expiration time comes and if you have won then, the amount will be shown in a green box as shown in the picture below.
Step 3: Make a deposit and switch to live trading
Making a deposit even in South Africa is pretty simple and requires only few minutes of your precious time. Simply click on the green deposit button at the right top corner as shown above and follow the instructions. You are now ready to start trading.
Risk Warning: As always, we inform our readers that trading involves risk. Always invest funds that you afford to lose.