Binary Options Trading E-book

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Contents
Introduction..................................................................................................................................3 What are Binary Options? ..............................................................................................................3 Pricing ..........................................................................................................................................4 Benefits of Binary Options .............................................................................................................4 How to Trade Binary Options .........................................................................................................5 Trend Following System .................................................................................................................6 Markets ........................................................................................................................................7 Trending markets ......................................................................................................................8 Range bound markets ................................................................................................................8 Volatile markets ........................................................................................................................9 Fundamental Analysis .................................................................................................................. 10 Technical Analysis ....................................................................................................................... 11 Trend Following: ..................................................................................................................... 11 Risk Management ....................................................................................................................... 13 Taking Profit ............................................................................................................................... 15 Risk/ Reward ............................................................................................................................... 15 Bet Size ...................................................................................................................................... 16 Portfolio Management ................................................................................................................ 17 Hedging Your Exposure ................................................................................................................ 17 Hedging Using Binary Options ...................................................................................................... 18 Hedging Binary Options ............................................................................................................... 18 Winoptions.Com ...................................................................................................................... 19 How To Guide: ............................................................................................................................ 19 Platform ................................................................................................................................. 19 Binary Options VS. Traditional Options.......................................................................................... 21 Account ...................................................................................................................................... 21 Transaction ................................................................................................................................. 22 Bonus Policy ........................................................................................................................... 22 Deposit & Withdrawal Procedure ............................................................................................. 23 Trading ....................................................................................................................................... 26 60 seconds.............................................................................................................................. 28 Pro-Trader .............................................................................................................................. 29 Support ...................................................................................................................................... 32

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Introduction
Binary options have recently come to the forefront of the on line trading world, and were listed in the Chicago Board of Options Exchange (CBOE) on July 2008. This step was a confirmation to many participants in the industry that binary options are a proven investment vehicle for speculators and hedging practitioners. Before July 2008, binary options were traded actively in the OTC market (over the counter) by large investors such as institutional and major investment banks. Retail investors were not able to participate in this dynamic market. Binary options, also known as, digital options are all or nothing options, which give the investor a fixed payout assuming the criteria of the option, are met. This means that there is a fixed cash payout to the option buyer if the option expires in the money. Nowadays there are many brokers and market makers who provide a safe yet effective binary option platform for both retail investors and professional traders.

What are Binary Options?

Payouts What makes binary Options interesting is the fact an investor receives a fixed payout as a return based on whether the financial market is above or below a specific level at a specific time. As opposed to a standard option, the Binary option buyer can look for a specific payout. The structure set up for binary options creates a significant payout, with relatively small moves in the underlying market. Binary Options are known as all or nothing options since they either make a payout or expire worthless. Usually, a binary option is priced at the current market and an investor is able to receive a return on his/her investment based on the short-term movement of the financial markets. The payout on a binary option is relatively simple. The payout is a specific dollar amount or a percentage of your investment you will receive assuming the option expired "in the money."

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Pricing
When trading standard options an investor has to analyze the strike price, the underlying price of the financial instrument and the implied volatility of the underlying financial instrument just to determine if there is a positive value in the call or put option he plans to purchase. With Short-term binary options most of the issues related to standard options are eliminated. The only basis for a successful trade is whether the option is above or below, the investor either receives a payout or does not. The best approximation for a standard trader to mimic the payout of a binary option is to use a very tight call or put spread. The pricing of an option is reflected in the payout that a broker distributes. In some cases the payout will be 1-1, and in other cases the payout is as low as 65% .

Benefits of Binary Options

Options trading have been available for a long time, and many investors use different strategies to speculate on the market direction. Unfortunately, most of the options, either calls or puts, expire worthless. This happens because the premium that is usually paid, costs more than the actual move that occurs in an underlying asset, basically the options are overly priced. This situation occurs because implied volatility, which is the perception of how much a market will move over the course of a period, is generally higher than historical volatility . Additionally, premiums incorporate market movements, and a more violent move than expected needs to occur for an option to consistently payout . For investors who wish to place directional trades on a financial instrument, the best way is to trade binary options. Binary options, allow investors to speculate on the direction of a financial instrument, without paying a significant premium. Call and Put binary options (also known as above or below options) are offered at the money and therefore just a small move is needed to expire "in the money" and receive a payout . There are also one touch binary options that allow a trader to receive a payout if the market touches a specific area. You can use this tool to hedge your underlying investments or to speculate on the market direction.

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How to Trade Binary Options

There are many ways to execute a binary option trade. Traditional binary options (usually known as above or below options); "60 seconds options" and one touch options. The most prevalent type of binary option is the above or below (call or put option). The above or below option give the investor a strike price in which he will speculate as to whether the market will be above or below that level (strike price) on a specific time horizon . Most brokers offer a large number of hourly options that are frozen about 15 minutes prior to expiration . To execute this type of options, (assuming that you have funded an account with the brokers Minimal account size), you just need to click on the call or put button to execute the trade. Once the trade is executed (transacted), you are locked into a trade that expires at a specific time. Some of the brokers who deal or make markets in binary options do not offer the opportunity for investors to take profits on positions that go their way prior to the expiration of the binary call or put option .

For example, if an investor where to execute a Call option on the EUR/USD currency pair at 11AM EST, when the underlying market was 1.2779 (which for this example is also the strike price), with and expiration time of 3:30 PM EST; and the market moved to 1.28 by 12 PM EST, the investor would not be able to sell their binary option for a profit. These options are based on an expiration time, and the only way to take some profit is to hedge the risk associated with the trade . We recommend a new feature, which allows traders to take profit on their trades. This feature is an excellent tool, and should be something to consider for investors who are trading binary options. The only caveat to this powerful tool is that an investor will have to pay premium to take profit on their position . Another type of binary option that is available is the one touch option. This binary option has a barrier feature, which allows and investor to receive their profits if the market moves to a particular level (touches a specific level). Some brokers offer investors a specific barrier level ,as well as, a time to expiration. Some of these options even cover the weekends . The last type of option that is available to execute is the range hit or miss option. This option gives the investor a specific return if the underlying instrument either hits or misses a range during a period. The execution of this type of option is as simple as executing the call or put options. Some brokers allow traders to draw (or define) the specific range that they are interested in hitting or missing, and the broker in turn calculated the returns that they will pay to the investor . All of these types of options can be used with numerous types of trading strategies and all of them are simple to execute .

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Trend Following System

To implement the system correctly, you need to be very cautious when selecting your investments. In short, you must only select investments that have a very high likelihood of finishing either UP or DOWN. The direction has to be very clear. To help you determine which way an option will go, you need to look at 2 things . 1. Firstly, take a look at the options available and select one that is currently above its value when compared to the previous hour . In the example below you can see that the option has been climbing and is higher than the previous hour .

*The yellow line on the graph illustrates the option's current value which is ABOVE its value for most of the previous hour.

2. Secondly, you need to check out what other traders are doing. Its important to see whether the majority of other traders are choosing Down (Put) or Up (Call) for this particular option . Take a look at the traders choice bar on the left and you can see the percentage division is 51% to 49% and the majority of traders are choosing Down (Put) as the direction of the option .

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*The majority of traders are choosing PUT (DOWN) for this option.

3. When you decide on an option that meets BOTH of the above criteria, you must immediately invest in that option by doing the following : 1 2 3 Click on the Put (Down) Button. Enter your investment amount. Click on the Apply button.

Thorough research has shown that when an option meets BOTH of these criteria, then there is a very high probability that the option will expire BELOW its current value .

*First click the PUT (DOWN) button. Then enter in your desired investment amount and click Apply

Markets
Financial markets move up and down and sideways, and recognizing what type of market condition you are in is an important part of learning how to trade. Once you determine the type of market you are in, you can figure out what tools you should use to help determine the future direction of the markets . Financial markets move in many directions. Sometimes, the markets trend in one particular direction over a short or long period of time. Other times, the markets stay in tight ranges without moving in a defined direction for a long period of time. There are times that the financial markets are very choppy, and move back and forth without moving anywhere . There are also times the markets are extremely volatile and move in one direction very quickly. Evaluating the particular market condition can be the different between a successful trade and a losing trade. Market conditions are a function supply and demand of a financial instrument. If demand for a product grows continuously, markets will move higher, on the other hand, if supply of a product out ways demand, the financial product will fall .

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Trending markets
A trending market is a market that moves in one direction over a period of time. A market trend is a putative prevailing course or tendency of a financial market to move in a particular direction over time. These trends are classified as secular trends for long term time frames ,primary trends for mid-term periods, and secondary trends lasting short times. Traders and analyst will use specific types of technical analysis to determine if the market is trending . When a financial instrument is trending higher, the market is called a bull market trend . When a financial instrument is trending lower, the market is called a bear market trend . There are many different types of technical indicators used to determine if a market is trending or beginning a trend.

In the chart below, the Gold Spot market looks like it began its trend when the 20 day moving average crosses above the 50 day moving average in June . The market will stay in a trend as long as it stays above its medium/long term moving average. Shorter moving averages are better suited for identifying short term trends, while longer moving averages are better suited for identifying longer term trends .

Range bound markets

When a financial instrument moves within a defined range, it is known to be range bound . When a financial market is in a bull or bear trend, it can experience times when they becomes range bound waiting for momentum to continue. When markets reach the end of a trend, they often become range bound as some traders who where long during the bull trend exit the market, but there is not enough demand for the financial instrument to push prices higher. This also occurs at the end of bear market trends. Range bound markets occur when supply and demand for a financial instrument is equal. The noise the market creates will push a market higher and lower during the course of a day, but without any impetuous to push demand higher or lower, the markets will stay in a range. Similar to finding trends ,technicians will use specific types of technical analysis to determine if a market is in a range .The Bollinger Bands are a specific type of technical indicator that market technicians use to determine if a market is stuck in a range. The Bollinger Band indicator analyzes price data and creates a 2 standard deviation range around a 20 day moving average. As the Bollinger Bands contract and move toward each other, the range of the underlying price of the financial instrument becomes tighter. When looking at the range that existed from mid 2007 to mid 2008 on EUR/JPY, a trader might come to the conclusion that the current range might last another few months (since the Bollinger range lasted approximately 12 months in the 2008 2007 period ( .

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Volatile markets
When a financial instrument moves quickly in one direction, the markets are deemed to be volatile. Volatile markets create trading opportunities, but they can also be very difficult to trade. Markets can also be volatile and choppy where, on an intra-day basis, the range of a financial instrument is very large, but the movement from the close on 1 day is small compare to the prior day. When markets are volatile or choppy, market participants are unsure of the direction of the market and therefore, this uncertainty creates large swings and volatility. One way traders and analysts measure if a market is volatile or going to be volatile is to look at a financial market that depicts volatility. The VIX, which is a volatility index, is a measure of how volatile the market is now, and how volatile it was in the past. The VIX Index is created by looking at the value of implied volatility that is priced into S&P 500 at the money options. By looking at a chart of the VIX a trader can see when the S&P 500 was volatile and what traders are currently expecting. When volatility is high, traders are expecting the market to move very quickly in one direction or another. When volatility is low ,traders perceive that the market will remain subdued. Trending markets, especially bullish trending markets generally have low volatility, while choppy and quick bear markets, usually display high VIX levels . As investors begins to follow the financial markets, they quickly become aware that there are many factors that create the ebb and flow to the short and long term market movements . Prices of financial instruments move based on market sentiment which is a function of supply and demand for a financial product. Successful trading is based on the ability of an investor to analyze the financial markets and determine when the price of an instrument is relatively high or low. The two main types of analysis that are used in determining the future price of a financial instrument are fundamental and technical analysis. These two types of analysis can be used independently or in conjunction with one another. It is important for an investor to understand both types of analysis and be cognizant that each analysis plays an important role in describing the future movements of the financial markets. The goal of this article is to introduce the reader to some basic fundamental analysis .

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Fundamental Analysis
Fundamental analysis is the process of using economic, financial or political news to determine the future movement of the markets. Fundamental analyst s will pour over numerous reports and releases to try to gain some insight into the future direction of the markets. For example, analyst will make predictions on the direction of financial based on economic news such as Gross Domestic Product or Central Bank announcements. Equity analyst will look at how a company performed over a specific quarter or what a CEO has recently stated to gain some insight into the future direction of a stock. It is important to be aware of what is happening in the world, since financial instruments like currencies, over the long term, reflect the state of the country the currency is used in. Every day there are economic releases around the world that reflect new information that determines the path that a fundamental analyst will need to examine .Fundamental trading is a type of discretionary trading. This means that the rules the fundamental trading analyst employs are subjective and can change based on the traders discretion. When a fundamental analyst examines recent news, he or she must also be able to determine if the news or events are currently priced into the market for a financial instrument. For example, if the expectations for an economic report such as the employment number are for a slight reduction in employment, does a small surprise make a difference over the short, medium or long term? The analyst will have to determine based on consensus estimates and their own estimate if the market has previously correctly valued an instrument ,when determining if there is an opportunity to take a position. Generally, when a market is surprised by some new fundamental news, the market reaction is immediate. After participants absorb the new news, the markets will continue to move in the direction of the initial reaction over a period of time . As the fundamental trading analyst practices investing in the financial markets, he will begin to understand the different fundamental news releases that are important, and those which expose the markets to noise. A fundamental analyst should keep track of how the market move on certain economic releases is an import guide to performance within fundamental trading. It is very difficult to be a fundamental analyst that specializes in all the markets . Each market has numerous nuances that create subtle and large changes in the direction of a financial market .

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Technical Analysis
Technical analysis is the study of asset prices in the attempt to determine the future direction of a market. Market practitioners who use technical analysis believe that the majority of the information that is available is already incorporated in the value of an asset. With this in mind ,a study of the price action will help determine the next move of the financial instrument . There are multiple types of technical analysis that individuals practice to determine futures prices. The art of technical analysis can be helpful in assisting an investor with entering positions, exiting positions, and managing the risk of a position. Technical analysis is categorized into different subjective and objective studies that allow different traders the ability to accomplish different tasks. Some of the objective studies include, trend following studies, means reversion studies and momentum studies. The subjective studies include pattern recognition as well as support and resistance .

Trend Following :
Trend following strategies are technical analysis strategies that analyze historical prices to determine if a financial instrument is within a trend. A trend is a specific direction and for the most part continues to go in the same direction over a period of time. The easiest and most efficient way to analyze a trend is to look at historical moving averages of a particular financial instrument. A moving average is an average where the latest days are dropped off the average calculation. In a 5 day moving average, on the 6th day, day 1 is dropped off the average calculation. An example of analyzing a trend is as follows. Say an investor examined the prices of the AUD/USD currency pair and the 10 day and 40 day moving averages of this currency pair, a trend can be potentially defined when the 10 day moving average crosses above or below the 40 day moving average. Moving average strategies are robust technical trading strategies and they are solid at defining trends, but on their own, they do not always generated the best entry point into the market . Momentum :

Second tool that is commonly used in trend following strategies is the moving average convergence divergence or MACD. This strategy measure momentum in the market and determines if momentum is climbing or falling.

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The MACD indicator measure the daily changes of the moving average and compare a short moving average change with a longer moving average change. If the changes of the short moving average are greater, the MACD will rise indicating that momentum is increasing. The reverse is the case when the MACD is falling . Mean Reversion :

Another technical strategy that is employed when trading financial markets is a mean reversion strategy. Mean reverting means that the financial instrument will fall back to its mean (average) after moving away from it over a period of time. A good analogy is to think about how far wills a rubber band stretch before it snaps back. This type of analysis would be helpful on two companies that have similar business models. For example, a trader could perform mean reversion analysis on Coke and Pepsi. A technical indicator that is used by analyst to measure mean reversion are Bollinger Bands. Bollinger Bands are a mathematical formula that calculated a specific standard deviation around a specific average . A second group of technical indicators that are used to measure mean reversion are Relative Strength and Stochastic indicators. Both of these technical indicators measure how fast a market has moved in the short term, relative to movements over a longer period. These indicators create an index that is used by traders to determine if a market is overbought or oversold .

Pattern Recognition :

Another type of technical analysis is pattern recognition. In this type of analysis, the trader is looking at specific patterns within the price action to determine if he can recognize a pattern that has show s propensity to forecast a specific price move. Any example of this type of pattern is a head and shoulders pattern. A head and shoulder pattern forms two shoulders and a head and in general the market will fall after forming the second shoulder . Technical analysts will also create trend line to determine support and resistance. Trend line analysis is subjective, but as a general rule, highs are connected to highs and lows are connected to lows to create a trend line . Technical analysis is a useful study to help market participants in an effort to create a specific trading strategy, or to assist in conjunction with other types of trading strategies. The study of technical analysis will not only help in strategy formation, but it will also allow the investor to have some insight into what other market participants might be considering. This article touched on some basic ideas that can be used when beginning the process of trading.

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There are numerous books and articles written on both fundamental and technical analysis, and investors should take the time to examine some of these types of analysis prior to trading, in an effort to develop their trading style .

Risk Management
One, if not the most important aspects of trading successfully is the ability of a trader to manage risk appropriately. Well too often, a trader will come up with a solid trading idea and place a trade without thinking about when they will exit their trade, or how much they will risk on a trade. Without a sound plan on how to manage your portfolio, successful trades will be the exception more than the rule. Money management is a defensive concept. It keeps you in the game to play another day. For example, money management tells you whether you have enough new money to trade additional positions. Trade size and stop placement are two distinct concepts. Stop placement does not address the question of how much capital should be allocated to a position. The goal of this article will be to explain how to manage a trade and a portfolio and the different techniques that can be used to create sound risk and portfolio management . The plan

Money management techniques are broken down in to a couple of specific areas. The first is how much capital should a trader allocate to a trade, and the second is how much money a trader should be willing to lose on a particular trade. Prior to entering a trade, an investor should have a sound strategy for the profit and the loss that they are willing to accept, and the size of the bet they are willing to undertake. In general, a prudent risk reward profile should be one where the profit is a multiple of the loss. For example, a trader would wants to earn $2 dollars for every $1 dollar of capital risked on a trade. In a scenario where a number of trades meet these criteria, a trader would need to win slightly more than 33.3% of the time to have a winning strategy. The math would work as follows on 9 trades: Winning trades 3 = winners * $2 profit = $6 total profits, losing trades = 6 losers * $1 loss = $6 total loss. From this example, you can see that with 9 trades, the winners and the loser would cancel each other out, creating zero profit and loss. Slightly more than 33.3% would allow an investor to generate gains.

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If a trader did not have this type of mentality when looking at a trading methodology, over a period of time they will likely lose money. When entering into a trade, the trader most have a specific idea of where they would want to stop loss out of the trade, and where they would want to take profits on a trade .

Creating a stop loss

When a risk management strategy on a trade is employed, one of the first items an investor needs to consider is how much are they willing to risk on a trade based on capital allocated and a move in the financial instrument. When determining how much of a market swing are they willing to accept against the direction of their position, the trader needs to decide where they should stop loss out of a trade. The stop loss determines how much capital a trader is willing to risk on a trade. Stop losses can be based purely on a notional amount of money ,such as risking $1 dollar, or a percent move in the market. A trader can look at historical moves or technical analysis to determine where a stop loss should be placed, or they can strictly base their decision on potential notional loses. When a trader designs a trading strategy that has been historically back tested, the trader can back test numerous types of stop loss amounts to determine the optimal stop loss level. Support and resistance levels are very solid ways for trend line drawing traders and discretionary traders to determine a stop loss level. By using a trend line in the EUR/USD Weekly chart below, a trader who has decided to short the EUR/USD could place a stop loss in the market at a price slightly above the trend line resistance level near 1.51. If the market moved through this level, the trader could exit the position. Traders will also use technical indicators such as moving averages or horizontal trend lines to create a level in the market in which they would like to exit a position. The stop loss is a very important way to minimize losses and maximize gains .Additionally, a trader could employ a stop loss that is dynamic and moves as the market moves. A trend following trader might consider creating a trailing stop loss that initially is set ,and as the market moves up, the trailing stop loss moves up to a level that minimizes any draw downs created from adverse market moves. Trailing stop losses can be a function of a percent of a market movement or a specific dollar amount. Some traders use specific price action levels such as the low of a prior day when they are taking a long position and the high or a prior day when initiating a short position.

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There are many ways to optimize a trailing stop to maximize trades, and an investor should look at historical market movements on specific financial instruments to determine the best way to maximize gains relative to trialing stops .

Taking Profit
Just as important as determining how much should be risked relative to a move in a financial instrument is the decision of where to exit a trade when taking profit. Just as with a stop loss ,a trader in advance should determine based on the risk associated with a loss, where they should take a profit. Similar to a stop loss, a take profit level can be based on a notional amount of dollars, a percent move in the market, or a specific technical level. Support and resistance levels are excellent ways to create a take profit level. When determining the take profit, it is also important to combine the amount you are looking to gain on the trade, with the amount you are willing to risk, which is your stop loss. Traders should avoid placing trades where they are willing to risk a greater amount of capital, than they are looking to gain. A trailing stop loss is one way traders can take profit on a trade .

Risk/ Reward
The essence of a trailing stop loss is that each time the market moves higher, the risk reward profile of the trade remains similar to the initial risk reward profit. This is called maintaining the risk/reward profile. A trader should avoid placing a trailing stop loss at levels where they are risking more once they move their stop loss, then they where risking initially. An example of this would be as follows. Lets say an investor placed a trade on IBM where he was looking to make 6 percent, and willing to risk 3% of a move against him on the trade. After the market moved 2% the trader plans to move the stop loss up to his initial entry price. This strategy would create the same risk reward ratio since the trader is risking 2% (the different between the current market which moved 2%) and the planned gain which is an additional .4% If the trader moved the trailing stop up to 1% below his initial entry point, after the market moved 2%, then the risk reward profile would be risking 3% (2% to minus 1%) to make 4%, which is a different ratio then the initial risk reward .

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Bet Size
Along with stop losses and take profit levels, determining the optimal bet size is a very important part of creating a profitable trading strategy. Sticking to a strategy that preserves a traders capital and avoids ruin should be on an investors mind when determining the appropriate capital to place on a trade. There are many mathematical models which include Monte Carlo Simulation and the Kelly rule which help statisticians determine the optimal bet size for a systematic trading strategy. A simulation will allocate an amount of capital to a strategy and historically step through time to determine the best way to allocate capital per trade. Realistically, there are a few potential ways to allocate capital. There is a fixed notional amount which allows a trader to place only a specific amount of capital per trade. This style can become ineffective as a traders capital grows or falls and can become unrealistic within a very short period of time. Another style is to have a fixed percentage allocation. The benefit of this style of capital allocation is that it avoids ruin by creating smaller bet sizes as your capital moves lower, but increases and compounds as your capital increases. Since it is very difficult when analyzing a discretionary system to determine if a strategy will have multiple wins or loses in a row, a fixed percentage strategy is a robust style to allocate capital . Another strategy, which is known as pyramiding increases the amount in percentage terms that a trader will risk as the portfolio climbs, and decreases the amount that is allocated as the capital base falls. This strategy works well if the strategy has trends where there are winners or that follow winners or losers that follow losers . The key to a successful money management style is to preserve your capital and live to see another day. Bet it all strategies are bound to fail and they should be avoided at all costs . One way to determine the percent to risk on a trade is to determine your goals prior to beginning to trade a strategy. For example, lets assume a traders goals are to make 10% within a year and he believe that his strategy will generate 10 trades throughout the year ,and the strategy generally wins 50% of the time and loses 50% of the time. Also, the strategy usually wins $2 for every 1$ risked. A capital allocation that risks 4% for every 2% risked will generate a return of 10%. (10,000 * 1.04 = 10,400 * .98 = 10,192 * 1.04 * 10,803 = 1.04 * 10,387 = 98. * 10,599 = )10,998 = 98. * 11,222 = 1.04 * 10,790 = 98. * 11,010 = 1.04 * 10,587 = 98. This type of analysis is very important in determining the correct amount of risk to allocate to a trading strategy .When beginning the process of creating a strategy, regardless of whether the trading strategy is a systematic (automated) strategy or a discretionary strategy it is very important to create a plan on how to manage your capital in a defined way.

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Sticking to your money management plan is one of the most important concepts and it will make the difference in a successful or unsuccessful trading and investing strategy. The underlying fundamental theory with money management is to preserve your capital. More than making money on the markets is the idea that you want to give your strategy a chance to make money by placing numerous trades over a period of time and avoid ruin at all costs. Unfortunately before ruin ,there is usually an uncle point where a trader decides that the strategy is a failure and he cannot afford to continue. The key for a money management strategy is to avoid both the uncle point and ruin. Creating a trading strategy is similar to running a business, you would like it to have a plan, that can be slightly flexible, but you are not willing to lose the business on one client or order .

Portfolio Management
Once an investor builds a number of positions for either one or multiple trading strategies, it is important to measure the synergies in each position and evaluate whether some positions mitigate the risks of other positions. If an investor has 10 positions and all 10 positions move in tandem, which means they are all highly correlated, then potentially all the positions can move against the investor at one time. This would be equivalent to taking 1 position that would risk ruin. This is a very important concept and a trader needs to perform an analysis to determine if any two or more positions are highly correlated .

Hedging Your Exposure

There are two interesting ways to think about how you can hedge your exposure. The first is that you have initiated a position in binary options, and you are interested in reducing the risk using financial tools that are outside of the realm of binary options. The second is that you have a position either in a stock or contract (or some type of option), and you decide you would like to use binary options to mitigate your risk. The concept of hedging is the act of reducing your risk exposure. For example, If you have a portfolio of stocks and you want to mitigate the exposure that you have to a fall in stocks, you could hedge the exposure by purchasing puts on a basket of stocks (or an index) or sell calls on a basket of stocks (or an index). Traders hedge their positions when the risks are not in their favor, or when a piece of news is about to come out and the information will create some uncertainty which might create volatility within the market . Http://www.winoptions.com Phone +44-20-33555288 Email :cs@winoptions.com

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Hedging Using Binary Options

Binary options are an excellent tool to use to hedge exposure. They are especially convenient since you can use a specific dollar amount to hedge. Lets say a Euro currency trader wanted to hedge his long exposure to the EUR/USD right before the European Central Bank announce their interest rate decision. The trader could purchase a below option for the period overlapping the central bank announcement with an amount that would allow him to make a percentage of the notional value of the EUR/USD position that is held. If the trader wanted to hedge $500 dollars worth of EUR/USD, trading a below option would be a simple proposition . If the announcement contained some information that caused the market to fall for a few hours (over even longer), the trader would be protected. The trader would incur some unrealized losses on his EUR/USD outright position, but would make back a percentage of those losses with gains in the below binary option . There are numerous additional binary options that can be used to create a hedge portfolio. A hit or miss option can be use to specifically protect both long and short positions. A miss option can even act like a covered call. Again when looking at the long EUR/USD position, a trader could purchase a miss option above the market. If the market rises, the losses on the miss option would be offset by the long EUR/USD position. If the mark falls, the gains on the miss option offset the losses on the underlying currency position . Traders can not only hedge underlying positions such as a currency or equity, but they can hedge their options positions by using a binary option .Hedging is an important part of prudent trading and currency traders should look into binary options as a way to mitigate their exposure .

Hedging Binary Options

Hedging binary options positions is the act of locking in your profit, and avoiding having a binary option position that is in the money, fall out of the money. Many times on daily or weekly trades, the markets will move in your favor, and you want to take your chips of the table. Unfortunately, depending on who your broker is, this process might not be as easy as you would like. Some brokers, as well as, the CBOE allow traders to take profits on their binary option positions.

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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When you are trading contracts, you just need to find a bid for your option, but when trading through a broker, you will need to pay premium for the right to unwind the trade. An alternative is to hedge the position . There are a number of ways to hedge a binary position. The first is sell (or buy) your underlying position. If you had a binary option position in the S&P 500 index which was 15 points in the money, you could sell the S&P 500 Index for an amount equal to your delta . This could be done using vanilla options as well. If you are interested in learning more about delta or vega hedging against binary options, please visit the site www.winoptions.com

Winoptions.Com
Winoptions.Com platform is a place where investors can learn about the binary options markets and how to invest wisely. The web site contains important information about trading binary options.

The site delivers in depth market reviews that can be used to trade on binary options.There is an enormous amount of information available about the options markets, and Winoptions.com website is a great source of information on the financial markets in general .

How To Guide :
Platform
What is a binary option ?

Binary options are a simple and rewarding financial trading product. Binary options deliver a fixed return on every trade which is made, depending on whether the trade was In The Money, Out Of The Money or a Tie. Binary options which are also referred to as digital options are one of the fastest growing financial trading products in the world because their simplicity, together with the certainty which they offer on every trade, makes them an attractive trading tool for many financial investors . When buying a binary option the potential return it offers is certain and known before the purchase is made. Binary options can be bought on virtually any financial product and can be bought in both directions of trade either by buying a Call/Up option or a Put/Down option.

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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This means that an investor can go long or short on any financial product simply by buying a binary option. Binary options are offered against a fixed expiry time which may be e.g. 5-30 minutes in the future, an hour ahead or at the close of the trading day.

What is an Underlying Asset ? Assets are any tradable products which a financial market can be based upon. The most common assets which are traded through financial markets are commodities (e.g. gold, oil , platinum), stocks (e.g. Microsoft, Nike, Citi, Coca Cola and others), currency pairs (e.g. eurodollar ,dollar-yen), stock indices (e.g. NASDAQ, Dow Jones, FTSE) and bonds . In binary options trading investors buy options on individual assets on a fixed expiry time in order to try to benefit from the price changes which are occurring within the underlying asset .

What is the maximum investment amount ?

1,500on the currency of choice in your account .

What is the time shown on this site ?

All times displayed on the Winoptions trading Platform are displayed in GMT (Greenwich Mean Time).

Where can I view the precise trading hours of each asset ?

To view a list of all of our trading assets, along with trading hours, trading symbols and a description of the asset please visit our Asset Index .

Do I have to download any software for trading ?

There is absolutely no need for you to download anything before you can start trading with Winoptions. All you need to do is register and deposit funds into your account and youll be ready to start trading binary options for yourself .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Binary Options VS. Traditional Options

Winoptions trading Platform offers simple, secure and rewarding binary options trading. Binary options are a new and exciting way to trade financial markets which differ from traditional financial options . Whereas traditional financial options normally have very long expiry periods, binary options on Winoptions trading platform have expiry times from the close of the trading day to as little as five minutes . Traditional financial options tend to offer wildly changing returns from investment, and are complex to trade successfully, binary options by contrast offer certain returns and are simple to understand .

Account
Do I have to deposit money for registration ?

No. A deposit is not required and no credit/debit card details are required in order to register for this site .

What currency can I use for trading ?

You can open an account in USD, EUR or GBP. Please note that you cannot change your currency selection after registration .

How secure is trading with Winoptions ?

We use the internationally accepted security system SSL (Secure Sockets Layer) that encrypts all credit card payments over the web. This system is automatic, and you will receive instant notification if your browser does not support it .

Are payouts taxable ?

Winoptions customers are responsible for their taxation liabilities, if any, at their place of residence. See our general terms for more details .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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I have problems with the registration process, What should I do ?

Contact our support team, and they will quickly resolve your problem. You can reach us via e-mail (support@winoptions.com), or by contacting one of our satellite offices or via our online chat service .

How can I register ?

Registration is extremely simple : 1. Fill in the mandatory details on the Start Trading Form, located on the right side of the screen and click the Open Account button. 2. You will receive a welcome e-mail with a verification link. Click it . 3. Youre done. Welcome to Winoptions !

Is there a registration fee ? No, Registering with WinOption is free of charge.

Transaction
Bonus Policy
TERMS & CONDITIONS

Winoptionss Bonus Policy: Winoptions offers a number of attractive reward features to its new and regular customers. Bonuses and onetime trading credits rewarded to clients are part of Winoptionss promotions program. These bonuses are limited time offers and the terms and conditions associated with any bonus rewards are subject to change. To learn more about Winoptionss rewarding bonus and promotional offers please contact us via live chat, phone or email .

Winoptionss Bonus Withdrawal Policy In order to withdraw your full bonus, you will be required to execute a minimum trading volume of 20 times for every $1 bonus. The bonus can only be withdrawn when the preceding stipulation has been fully met and fulfilled .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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The withdrawal of funds from an account before completing bonus conditions will immediately nullify the bonus and will be removed from the account . Any indication of fraud, manipulation, cash-back arbitrage, or other forms of deceitful or fraudulent activity based on the provision of the bonus will nullify the account and any and all profits or losses garnered .

Deposit & Withdrawal Procedure

This policy applies to all Winoptions accounts . To deposit and withdraw any funds with Winoptionss the Following criteria must be met by each client .Each client must submit documents authenticating their account with Winoptions . Those documents are as followed : 1. A Photo ID. This must be government issued and can be a driver's license, passport or residency card . 2. Proof of address such as a utility bill. This must verify your physical or billing address in the country of your residency . 3. If invested through credit card, then a copy of the credit card used for investment must be sent. The copy should be that of the front and back of the credit card with the middle 8 numbers of the card covered and the CVV on the back of the card should be covered as well . These documents should be scanned in clear copies and sent via email to billing@Winoptions.com with your name in the subject line of the email .

These documents can also be faxed in clear copies to +357-2203-0601 .

Deposit procedure :

A client can invest with Winoptions using multiple methods. Those methods are Credit cards ,debit cards, wire transfer CashU, Money Bookers, AlertPay and Liberty Reserve . Winoptions is working daily on providing our clients more processing and investment methods .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Credit Cards : The credit card used for transaction with Winoptions must match the name on the account . Winoptions accepts Visa, MasterCard, AMEX, Maestro, Visa Electron and Diner's .

Wire Transfer :

The minimum for a wire transfer is $500. Any transfer below the amount of $500 will be charged a $25 fee. The wire transfer must be to the exact details which are posted on the deposit website under wire transfer. You must email a copy of the wire transfer to billing@winoptions.com. It can take up to 5 business days for the wire to appear in your winoptions account .

CashU :

CashU is a new anonymous way to invest with Winoptions. This payment method is popular in the Middle East and Western Europe. Simply go to CashU website for how to invest using CashU with Winoptions .

Withdrawal Procedure :
Winoptions's finance department handles all withdrawal requests submitted. The documents outlined above must be submitted in order to process a withdrawal . There is no fee to withdraw via credit card, however any withdraw using bank transfer will accompany a processing fee of $25 . Once a withdrawal request is submitted it can take Winoptions up to 10 business days to process and approve the request .

Credit Card Withdrawal :

All funds invested by a credit card can be withdrawn to the same card only. The maximum withdrawal amount to a credit card cannot exceed the amount invested. Any additional funds can be withdrawn via wire transfer or to a MoneyBookers.com account .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Wire Transfer :

A wire transfer withdrawal can be made for profits or to those accounts which vested using the wire transfer method. A processing fee of $25 is applied to a wire transfer withdrawals . CashU :

There is no fee for a CashU withdrawal. The withdrawal can only be done to the same CashU card . If you have any questions in regard to this policy please feel free to contact us via our live chat, email or phone. We look forward to assisting you in all your trading needs .

How can I cancel a withdrawal ?

You will have the opportunity to interrupt the withdrawal even when your application is in progress, consequently your money will return to your WinOptions account. The withdrawal refund option is especially useful when you have insufficient found in your account and an interesting investment opportunity appears. In order to cancel a withdrawal, please contact us by phone at your correspondent number, live chat, or e-mail your account manager at Cs@winoptions.com.

What is a Swift Code ?

A SWIFT code is the unique identification code of a particular bank that is used when transferring money between banks. Your bank can tell you what its SWIFT code is. If the SWIFT code comprises only eight digits, you will have to insert XXX at the end . Is there a minimum withdrawal amount ?

No, There is no minimum amount to place a withdraw.

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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What is the fee to withdraw funds ? The fees change depending on the method of withdrawal : Credit / Debit card withdrawal up the amount deposited (no fee.) CashU - no fee Liberty Reserve - no fee Moneybookers - $15.00 processing fee. Alert Pay - $15.00 processing fee. Wire Transfer - $25.00 processing fee.

How can I withdraw money from my account?

You can withdraw money from your account back to your credit card (up to the amount you have deposited)Or to the same source you fund the account with and receive your profits by wire transfer,MoneyBookers.com Or to the same source you fund the account with.

How can I deposit money ?

Please refer to our Banking page. We accept all major credit and debit cards (Visa , MasterCard etc.), wire transfers, cashU, MoneyBookers.com AlertPay and liberty Reserve .

Trading
What is Double Up ?

If you are close to your expiry time, and you think that the direction you predicted is on a roll ,then you have the chance to do it again by clicking on Double Up. By doing this, you can create a new trade with the same conditions, for the current price of the asset. In a nutshell ,when things look good, Double Up gives you the opportunity to increase your investment and thus, double your profits . Double Up Benefits : Increase your investment on open positions Make double the profit on expiry

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Immediately capitalize on a strong position

What is Rollover ? Rollover is a powerful stop loss strategy that allows you to postpone the expiry of your option.When the market disagrees with you, that is when it looks as though your prediction is not going to be on target by the upcoming expiry date, activate Rollover with the click of a button. This gives you another opportunity to close "in the money." Rollover Benefits: Postpone the option's expiry time Utilize a powerful stop loss strategy

Get 30% higher returns when your option expires in the money for an added 30% investment Turn loss into gain with time on your side The Roll over feature is available up to 10 minutes prior to the Expiry date

Per each particular option Rollover can be applied only once. *Rollover feature is not available for the end of the day trade .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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60 seconds
60 seconds is a new feature added to the WinOptions trading platform. With Each option lasting only 60 seconds until expiry, it allows the more seasoned investors to capitalize on market volatility.

*Winoptions.com 60 seconds Trading

To trade with the 60 Seconds 1. Choose the asset in the top left corner 2. Enter an investment amount 3. Choose up or down 4. Press START to transmit the order 5. Press "OK" to place the trade or "Cancel" to find a better rate. 6. Wait 60 seconds to expiry

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Pro-Trader
The concept behind this tool is to allow additional features to the traditional Binary Trading Platforms. The New Pro-Trader Platform features the underlying instrument's price chart from the moment it started trading. You can also see options you own located on the chart. You can also use the "Buy Me Out" feature to realize your profits immediately, which means that you don't have to wait for the expiry!

*Pro-Trader Platform

How the Pro-Trader Platform works: Choose the asset in the top left corner Review the history by choosing the back or forward buttons by either 1 hour or 10 minutes on the bottom left corner Choose an expiry time Choose up or down Enter an option amount Press apply Press Approve to place the trade or cancel to find a better rate.

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Why am I not able to make a trade ?

1. All our assets are available during market trading hours. Outside the market trading hours ,the asset will not be displayed in Winoptions.Com trading platform. 2. Another reason could involve a lack of funds in your account . 3. If none of the above answers your question, please contact us via email at : support@Winoptions.com or through our customer service phone numbers in your region (located under "contact us") .

Why do the rates continue to change when I make a choice ? Trading with Winoptions.Com is attached to market prices which are extremely volatile. Market fluctuations, exchange rates and other parameters affect our real time automatic pricing system,thus, prices change every second, even when you are selecting an option. To facilitate your operations we developed a pricing chart that shows market prices and statistics. If prices appear in green, the current price is above the last update. If prices are shown in red, the current price is below last update . This tool aims to simplify market information provided to you. What is the expiration time ?

The expiration time is the date and time at which the binary option expires . What is the expiration rate ?

The expiry rate is the level of the underlying asset at the time of expiry of the asset according to Reuters. This is the determining level if the option has expired in-the-money or out-of-the-money. A different expiry rate is determined for each underlying asset .

What are the rates displayed in the trading boxes ? Rates are the live quoted prices of the underlying assets .The rate is a live feed from Reuters for stocks and commodities and Xignite for currencies .The rates we present in the trading boxes on our home page are those at which Winoptions is willing to sell the following options .

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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What return will I get if an option expires out of the money ?

In the event that the option expires out-of-the-money, your account will be credited automatically with a proportion of your original investment. The proportion you will be credited varies depending on the option you have taken from 015% of the value of your original trade. For example, if you traded a Nasdaq Call option with a value of $500, and at the time of expiry your trade closed "out of the money" - you would receive a credit on your trade of between $0-$75 depending on the option you bought .

What return will I get in case of a successful investment ? A successful investment will result in a guaranteed return of between 65-88% of the initial amount invested. The payout for each successful trade is indicated on the site for the underlying asset that you selected. For example, if you invested $500 in a Nasdaq Call option ,and at the time of expiry, the level was higher than the level at the time of your investment - You will receive a payout of between $825-$940, depending on the type of option that was offered. How can I invest ?

Simply choose between buying a "call" or a "put" option on any asset you want to trade. Clicking on the call/put button will open an investment sheet in the same box, where you will be requested to enter the amount for investment and to approve the execution. The selection may be canceled by clicking on "X" at any time before approval of the transaction. Please note that the rates keep updating in the investment sheet . What is a Put Option ?

An option that is profitable when the underlying asset price is lower than the price it was purchased at. In case the option expires exactly at the same price, the full original investment is returned to the investor (Tie). What is a Call Option ?

An option that is profitable when the underlying asset rises in price compared with the price it was purchased at. In case the option expires exactly at the same price, the full original investment is returned to the investor (Tie).

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com

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Support
How can I contact you ?

You can reach us via e-mail (support@Winoptions.com), by calling one of our satellite offices or via our on-line chat service . How can I change my personal details ?

You can update the information in My Account>Personal Details or contact us via email at: support@Winoptions.com .

What should I do if I have forgotten or misplaced my password ?

In that case you should contact us via email at: support@Winoptions.com, contact our live chat or call the customer service number in your region (located under "contact us").

Http://www.winoptions.com

Phone +44-20-33555288

Email :cs@winoptions.com