Navigating financial markets can be a difficult endeavor regardless of your skill level thanks to the sheer amount of information and choices that are available to individual investors. With stocks, bonds, ETFs, and other securities to choose from, finding the right strategy that works well for your personality and financial goals can take years. It’s safe to say that keeping things simple makes a lot of sense for both beginners and experienced traders.
That’s why trading binary options is such an intriguing prospect. There are financial instruments that allow you to speculate on the price movement of an underlying market and in many ways are easier than trading stocks. Whether you’re interested in trading beyond traditional financial products or you seek a more exciting way to access the market, binary options trading with North American Derivatives Exchange (Nadex) has so much to offer.
Here are three advantages to binary options trading with Nadex to consider.
Advantage #1: Trade Simple, Trade Smarter.
While trading traditional financial instruments like stocks can be very lucrative, it is sometimes difficult to generate consistent returns and can require a steep learning curve to get to a point where you are confident in your decision-making. Also, one of the big challenges with traditional trading is determining how long you should remain in a trade. That’s why trading binary options with Nadex is such a strong alternative.
Binary options trading is simple and easy to understand. First, you select the underlying market that you are interested in trading. This can include asset classes like stock indices, gold, oil, the dollar, the euro and more. After you’ve decided the underlying market you want to trade, simply predict whether it will go up or go down. Since there are only two possible outcomes when you hold the contract until expiration, all you need to do is decide to enter a trade and place the trade. You can also exit your position early to lock in profits or limit losses. With binary options, you can get into your trade and walk away, feeling confident in the fact that you know the two most extreme outcomes; however, more active traders will love the fact they can monitor their positions and have the flexibility to exit early.
Advantage #2: Limit Your Risk.
It’s common to only focus on the upside of each trade, but any experienced trader will tell you that managing risk is the most important component to your success. This is another big advantage to binary options trading with Nadex. Since the binary option order tickets show you all of the possible outcomes upfront, you always know exactly how much you are risking and how much you stand to gain on every trade. Binary trades at Nadex are priced between $0 and $100. If your trade is successful, you receive a $100 payout, so your profit will be $100 minus the money you paid to open the trade. If your trade isn’t successful, you don’t receive a payout. This means you lost your initial capital used to place the trade, but nothing else, because your risk is capped.
You can get started with a free demo account to test your skills first. To fund your live account, the minimum deposit is only $250 to start trading, which is great because the amount of capital required for traditional trading is typically much higher.
Advantage #3: Rely on a Regulated Exchange.
Nadex is the largest regulated exchange for trading binary options in the United States. It’s regulated by the Commodity Futures Trading Commission (CTFC) and allows you to trade in a regulated environment without having to worry about the issues that are relatively common with providers outside of the U.S. Adding and withdrawing funds from your Nadex account is also quick and convenient, which can be an issue with other exchanges.
It’s refreshing to find a binary options exchange that promotes integrity, transparency and client-friendly business practices. This is another advantage to binary options trading with Nadex. If you are interested in learning more or getting started, you may want to check out the company’s website today.
Disclaimer: Trading on Nadex involves risk and may not be appropriate for all. Members risk losing their cost to enter any transaction, including fees. You should carefully consider whether trading on Nadex is appropriate for you in light of your investment experience and financial resources. Any trading decisions you make are solely your responsibility and at your own risk. Past performance is not necessarily indicative of future results. Nadex is subject to U.S. regulatory oversight by the CFTC.