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Published on April 16th, 2014 | by Pete


Are binary options on the upswing?

A steady growth in binary options trading has been a noticeable trend in the ever-expanding world of investment products. What was once routinely described as an “exotic” option not so long ago is now considered a standard and reliable form of trading. So, what exactly is behind the growing popularity of binary options?

Binary options first came to prominence in 2008 but were greeted with a dose of scepticism. This has since dissipated due to a variety of factors. For a start, since binary options were first launched, a great deal more information has become readily available. The passage of time means that it is easier for traders to easily find out how reliable a binary options platform actually is – This was a perennial obstacle when the product first came on the market. Beyond that though, there is now so much more information regarding trading strategies and how current market positions might move – All of which means that successfully trading binary options is easier than ever.

At the same time, this boost in information has been matched, if not exceeded by advances in technology. In particular, since 2008, mobile technology has played a massively important role in online growth. This has given traders the kind of flexibility, especially in fast-moving trades such as binary options, which they could never have enjoyed before. Thanks to mobile technology, professional and casual traders alike can be away from their desks and still keep in touch with developments.

Above all though, perhaps the biggest factor in the upswing in binary relations is simply better education. So many of the misconceptions surrounding binary options when the product first appeared have now been dispelled. There is a much better understanding of the advantages of binary options. For a start, more people recognise that given their binary nature, binary options are simple to understand and are perfect for novices, not just experienced traders. Those who would otherwise be nervous about financial trading now increasingly see that binary options pose lower risk and give greater control than many other investment products. Traders can easily calculate their potential losses and gains without being dependent on wild market fluctuations. In addition, because it is possible to initiate multiple trades, risk can be controlled in a way which is difficult to replicate elsewhere. For example, losses can be hugely minimized by trading in both directions, offsetting a possible loss by trading a smaller amount on the original trade’s binary opposite. Similarly, profits can also be maximised by multiple trades. Quite often for example, currencies are tied to commodities and so by trading on both, it is possible to essentially double the financial gain on the same market movement.

Another important development has been increased regulation in binary options. The financial authorities in most countries have adapted to the increase in popularity by instituting regulations accordingly. As a result, many platforms which promised unrealistic “massive returns” and “easy money” have been successfully weeded out of the industry, increasing confidence. Many platforms today provide the option of a demo account or virtual funds to allow traders to learn, experiment and get to grips with binary options. It is just another example of the growing sophistication in binary options trading, an overall trend which has seen its popularity reach new heights.

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