Mr. Jean-Yves Sireau, through Binary.com, wants to ensure people can make the right investment decisions when they trade in binary options. These types of trades have earned a reputation as being incredibly risky, with some even equating them to gambling. However, according to Mr. Sireau, binary options can be an excellent form of trading, so long as people avoid the most common mistakes.
Mistake 1. Not Having and Utilizing a Trading Strategy
According to Jean-Yves, a lot of people think that trading in binary options is easy, because it is so easy to access a trading platform. Be that as it may, it is still a form of trading, and all trading must be done according to strategies. There are numerous strategies out there, and it is important to choose the right one for each trade, and stick to it.
Mistake 2. Not Managing Money Properly
Binary options are win or lose trades. You predict whether the asset is going to move up (high) or down (low). If you are right, you are returned a fixed price. If you are wrong, you lose your investment. It is very important, therefore, that people manage their money properly so they don’t end up losing it all. In that sense, trading in binary options is somewhat like gambling in a casino, as it is all about knowing when to walk away.
Mistake 3. Making too Many Trades Simultaneously
A lot of inexperienced traders believe that if they trade more, they will also profit more. In reality is that the investment strategy then becomes confusing, and confusion always harms. Hence, according to Jean-Yves Sireau, key is to not become overconfident, even if you have profited several times in a row. It is vital to stay focused, not in the least so you can respond properly to situations in which your strategy didn’t work, or you otherwise lost your money.
Mistake 4. Having Insufficient Investment Funds
Binary options are cheap, which is what makes them attractive. However, that does not mean you can get involved in these trades with just a few dollars to your name. In fact, you will usually find that brokers have a set minimum. According to Sireau, it is best to start with slightly more than the minimum investment imposed. A reasonably funded account gives you more leverage and ensures you can make more trades (but not too many) and use different strategies.
Mistake 5. Unrealistic Expectations
You may expect to see huge returns in binary options trading. Sometimes, that does happen, but not always. You may have a fantastic day trading, and find you don’t make any profit at all the next day. What you must do, therefore, is set yourself and objective and work towards that, slowly and patiently. Everybody has bad days every once in a while. If you set your expectations too high, or they are otherwise unrealistic, you’re more likely to end up walking away with not profits at all.