Binary Options Trading UK
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When engaging binary options trading you must take into account, that there are risks involved when with binary options trading, the market you are entering is a prediction market and as such it can not provide with any certainty. However, there are some aspects about binary options trading UK which do offer some certainty. In any case you should know that the Financial Conduct Authority is the official entity regulating binary options brokers in the UK.
Certainty In Binary Options Trading
You can be certain that if the price moves in the direction you predicted it would go, you would be rewarded with the payout rate that is listed on the binary option. You are also certain that the amount you are willing to risk can equal the amount invested in the binary option, or less, assuming there is a refund rate listed on the binary option.
You can also be certain that every binary option you choose to buy, would expire at the expiry date and that your investment would end at that exact time. You might have the ability to postpone the expiry date for the option, depending on the broker you use.
Creating Your First Binary Option
So actually to create a binary option trade you need to choose the asset and select the direction and time at which you want the option to expire, all that is left is to enter the investment amount and approve the position with your U. K regulated binary options brokers. Now you wait for the position to expire and check whether the price is moving in the direction you anticipated, if it does than you are in a good position, what we call In the money, if it goes the other way than its referred to as Out of the money.
If the price goes in your favor and you think that the trend you are trading would long live, you can enter another binary option in the same direction and the same underlying asset, to expire at the same expiry date or one expiry date after, that way you can seize the outgoing trend. There is another action you can take, when your binary option is In the money but hasnt expired yet, you can sell it before the expiry date reaches and realize on lower profits than the ones you might have won, if you waited until the expiry date reaches.
If the price doesnt go as you anticipated you can take one of two actions, you can either postpone the expiry date of the position, which would force them to increase the original investment amount, in that case, if the option eventually expires in the right direction we would increase our profit from the trade. The second action we can take when our binary option is currently loosing or Out of the money, would be to sell the option before the original expiry date reaches, you would still suffer a loss from that binary options trade but it would be less than the amount you might have lost if you were to wait for the option to expire on its original expiry date.