One of the greatest criticism of binary options is that you are investing against your broker. Much as in casino gambling, so the critics, the bank will always create the odds in its own favor, which renders any attempt to make a profit futile.
This, of course, is not entirely true. There are a number of important facts these critics do not account for. This article will show you how to beat the bank.
Understand the mechanism behind binary options
While it is true that you invest with the bank with binary options, it is not true that the bank makes money when you lose money. Your broker makes money, when all its customers combined make less money than they invest.
The assumption that the bank is trying to make money from every single one of its customers is ridiculous. The bank is trying to make money in total. To achieve that goal, the bank has to make sure that some of its customers are becoming rich men by using their service.
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In truth, binary options shift money from unsuccessful to successful traders. All you have to do is make sure that you come out on the right side of this deal. With binary options, your profits are the losses of other traders, just as with any financial investment.
Of course, the bank takes a small cut of the overall money that is shifting sides, but any kind of bank does the same with any kind of investment. When you invest in stocks, your bank charges you a fee and offers a lower price for people selling than for people buying.
In short: The people making money will never make all the money that people that are losing money have lost. The bank will keep a little piece of it. Most of it, however, will end up in the bank account of someone else. Therefore, the basic rules of investing in binary options are the same as with any type of asset. They are just drawn up differently. Do not let people that do not understand these basics discourage you from investing in binary options.
You are not investing against the bank
One of the most important steps to making money with binary options is to realize that you are not investing against the bank but against other traders. You are investing against other investors, the bank just makes the rules for this competition.
This step is so important because it changes the entire approach to making money. Instead of constantly searching for a genius new way of trading, using a proven trading strategy that works will be enough. Your main instrument to beat the other traders is consistency and error-free trading. When other traders make mistakes, allow their emotions to guide their trading, or do not have a clear cut trading strategy, they put money in the bank.
This money is there to be taken by a trader with a consistent trading strategy that is not guided by emotions and uses a solid trading diary to improve his trading. Whether you are this trader or not depends on you. You can find all the tools you need here on BinaryOptionsStrategy.net. Whether you want to make money bad enough to read and learn them is your decision.