Since the appearance of binary options on the global financial market in 2008, numerous traders across the globe managed to recognise the earning potential available with this online based form of trading.
Naturally, one of the most frequently asked questions is how to profit with minimum investment in binary options?
In this guide, we shall try to provide interested South African traders with an answer to this question and provide additional advice which could lead to profitable binary options trading experience.
The Principle of Binary Options Trading
The attraction of trading binary options is a curious mix of simplicity, flexibility, diversity and affordability.
The simplicity aspect is reflected in traders having two basic choices since the price of the asset can either go up or down.
The fact that interested traders from all walks of life are able to participate in this trading process regardless of their experience covers the flexibility aspect while a wide range of assets, generally sorted into four distinct groups reflects the diversity.
Lastly, the aspect of affordability is easily explained by the fact that the average minimum deposit in binary options industry is set at $250.
There are some brokers which are very popular in South Africa like IQ Option which has a minimum deposit of only $10.
With such affordable minimum deposit traders also get quite economical minimum deposit per single trade which ranges from just $1 per trade to $25.
Naturally, various brokers also offer traders the possibility to invest much more.
Considering the fact that binary options have a legitimate status on the South African market and combined with all the above-mentioned facts and it becomes easy to see the interest of South African traders in binary options trading.
Minimum Deposit South Africa
When traders first decide to trade in binary options deciding to deposit the minimum sum set by a particular broker is the usual course of action.
By depositing minimum amount traders are taking the most secure route as most have little to no experience in trading experience and are just testing the waters.
In most cases, the minimum deposit provides traders with the simplest trading account type with specific features which vary from one broker to the next.
Minimum Investment in Binary Options
The principle concern traders face is the nagging question how to profit with minimum investment in binary options.
However, in binary options, the possibility to generate profit exists even with a minimum investment. Naturally, the more traders invest the higher possible gains are.
On the other hand, by investing minimum sums per trade, traders are actually controlling risk levels as it is much more difficult to enquire crippling losses.
Binary options trading carries risks, just like any other form of financial trading.
However, by getting informed and by learning the conditions surrounding every asset it is possible to keep the risk levels reasonably low.
By understanding the nature of assets and knowing which events might influence the direction of the price is all useful data for aspiring South African traders.
In knowing all these info traders may place multiple and diverse traders with different underlying assets and investing minimum amount.
That way, the risk is kept reasonably under control as much as possible and even if some of the traders do not finish “in the money” by the end of expiry period traders will not face immense loss. Rather, the loss, if it happens, will most likely not be such as to create serious consequences.
By spreading out the trades and investing smaller or minimum sums traders are not just being careful but they are also gathering valuable trading experience and are learning the tricks of the trade.
Long Term Trading
While trading short-term options like 60 seconds does provide the possibility to achieve higher profits the risk level too is much higher.
The reason is rather simple; it is much more difficult to predict what will happen with a direction of price in a short time span. Trading short term options
Trading short term options does require more experience as well as more trading knowledge. Understanding technical and fundamental analysis as well as trends is also necessary. In fact, the ability to detect trends and interpret them correctly and at the right time is very important for short term binary options trading. But, that takes time, experience and knowledge.
But, that takes time, experience and knowledge.
On the other hand, trading long term options is generally considered as a more secure way of trading as it is easier to predict what might happen with asset price.
Also, in long term options following market news which concerns certain assets can be very useful in making an educated guess of what might be happening with a price over a period of time.
So, by investing a little bit of time in some basic education, and most brokers have excellent educations sections on their platforms, and combining minimum investment and long term trading, aspiring South African traders may achieve healthy profits.