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Binary Options Assets

To understand what binary options really are, it is wiser to take a look at the similarities to Forex and only explore the differences afterwards. Currency pairs are the cornerstone of foreign exchange and they are just as popular with binary options, being one of the most traded underlying asset. Those who are familiar with Forex are often migrating to this market, without forsaking the former, in an attempt to diversify their portfolio and at the same time to maximize their profits.

The same principles apply when trading currency pairs, but with binary options it is enough to anticipate the way the price will move. It doesn’t matter if the underlying asset will move way past the limit at the expiration time, or just one pip as your order will end in the money and you will be paid. The same currency pairs can be traded and obviously, the Majors are still the most popular due to their high liquidity and better spreads.
There are of course a few who like to push the envelope and trade exotic currencies, but these have several disadvantages that you can offset only if you know a great deal about them. Seasoned traders can venture into this uncharted territory, but for beginners this will be a costly mistake. Among all currency pairs, the USD/EUR reigns supreme and the ones trading it will confirm that this is the best way to start your career, if you don’t want to transform investing into gambling.

Commodities and precious metals are gaining ground recently and the major advantage of trading binary options instead of regular foreign exchange is that they have access to these assets. Oil and gold are the most traded ones, but there are several others that can bring you a nice profit as long as you know what you are doing when opening a position. Many think that knowing the basic plot is enough and will enable them to make the profits they dream of.

Gold for example is a crisis commodity and its constant appreciation is a direct consequence of the dwindling confidence in printed currency. Naturally, most of those who opened long term positions betting on higher prices for the precious metal won, but when you are involved in day trading you need to be well informed. The same applies to oil, which being less and less each day will become more expensive in the future, but basing your orders solely on this assumption can cause you significant loses on the short run.

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