Difference Between Binary Options & Forex Trading?
The Forex trading arena is constantly developing and advancing. With an astronomical 3 trillion dollars traded daily in Forex, there is a lot of room for new services to join the game. Binary options is the new kid on the block and judging by the amount of binary options brokers, it is here to stay.
So what are binary options and how do they differ from regular Forex trading? Well, on the most basic level, options trading is exactly how it sounds. There are two options, either the currency goes up or down. You open a position by guessing which direction it will go.
There is amount involved and in theory, binary options trading requires zero preparation. Of course, if technical analysis helps you determine the direction the currency will take in the next hour or day, then it is a recommended tool in both trading arenas.
However, options trading is generally a lot simpler than Forex trading. The platforms are all Web-based and all you have to do is click an up or down arrow. It really could not get simpler.
Another great thing about options is that you know exactly how much you are going to profit or lose without the volatility risk of regular trading. This also simplifies the binary options trading arena.
Of course, the flip side is that there are a very limited number of reliable binary trading brokers from which you can choose as opposed to Forex trading brokers, which are available by the hundreds, if not thousands.
Options trading might be the newest thing in the market, but it is not right for everyone. If you are a person who likes instant gratification and relatively smaller profits, then it might be a field worth checking out.
If, however, you are interested in Forex as a long term career, then some might say standard Forex trading is more suitable of an option.