How To Understand The Spot Option Trading Platform
In this video, I just want to give a basic overview of the Spot Option trading platform.
With Spot Option, you can trade currency pairs, commodities (precious metals, oil, gas, etc.), Indices (large groups of stocks), and Stocks (individual stocks such as Microsoft or Facebook).
Standard binary options simply means that there are only two outcomes. Either the price of an underlying asset (i.e., currency pair) will go up or down. It is a simple bet or “educated guess” as to whether or not the price will go up or down within an allotted amount of time. That alloted amount of time is based upon the ‘expiry’ time meaning that the option will expire or close at a designated time.
For example, if the current time is 9:46am and the earliest expiry time is 10:00am, then you have 14 minutes before that option expires and you get to know you fate (whether you win or lose). You will NOT be able to enter the trade at 5 minutes or less before the option expiry time, meaning, you cannot place a trade after 9:54am (9:55am or greater will not be accessible).
Second, you have pairs which means that you are going to bet whether a certain asset will outperform the other. These are simple but very complex at the same time because it requires a very in depth study of the market and its conditions.
Third, you have Long Term options which is the same as the standard binary options except you are betting whether the price will go up or down over the next several days or week.
Fourth, you have 60 second trades. These are very popular and you can make a lot of money very quickly (or lose a lot very quickly). They are called 60 second trades because there are various expiry times based upon 60 second intervals. For example, there are 60 sec., 90 sec. (1.5 min), 180 sec. (3 min), and 300 sec. (5 min). Many popular trading indicators and signal services use the 60 second methodology to trade with, which will enable you to make lots of money very quickly. DO NOT use these options without some type of trading software to tell you which way the market is going to go up in such a short time frame.
Next are One Touch options meaning that if a certain asset ‘touches’ a particular price, you will win that trade (bet). It is extremely easy to win money, but the problem with One Touch options is that the price that the asset is supposed to ‘touch’ is almost unrealistic and almost never touches that price. My advice is to stay away from these assets.
Then are Ladder Options. What we are betting here is that the price will go up or down in the same direction at multiple times. For example, If the price will go up at 9:00am and keep going up for 9:30am, 10:00am, and 10:30am, and goes up at each interval, then you will win. That is indeed very risky and should only be used if you are a very experienced trader.
Next is JLdo. With JLdo, you simply have a range in which you can bet that the price will end at. In this type of option, it does not matter whether or not the price goes up or down, only that it falls within a certain range. In other words it can’t go up or down too much. This is indeed very risky and should only be used in a ‘flat’ market meaning it have very little movement.
After JLdo, you have FX/CFD. This is currently not available.
Then you have Spot Follow in which you can follow various “top producing” traders and see what trades they take and how they earn their money.
As you are learning how to trade various options, please stick binary options simply because they are the most popular and easiest to learn.Related posts: