Options Trading as an Amateur Options Trading is a kind of online trading based on the Forex market. This term contains excessive information that can’t be explained in a few words. Options Trading can be defined as a way of online investment for a fixed return with an expiration period, which is also fixed. It […]
Options Trading as an Amateur Options Trading is a kind of online trading based on the Forex market. This term contains excessive information that can’t be explained in a few words.
Options Trading can be defined as a way of online investment for a fixed return with an expiration period, which is also fixed. It has gained huge popularity in the last couple of years, mainly because of its simplicity and appeal toward the public. To understand it first, know the Forex market.
What Is Forex and How to trade in Forex Market?
Forex means Foreign Exchange. In the Forex market, you will buy/sell currencies. This is a common description of the Forex Market. But today, Forex market trading is the kind of online trading. Some companies offer you to trade in the Forex market, and the traders call them Forex Brokers.
Forex is like the Stocks market. Nowadays, a lot of Forex Brokers offer their clients trading on Stocks, Energies, and metal markets too. Just like stocks markets in the Forex market, you can trade currency based on what you get about the currency value, but the main difference with Forex is that you can trade sell or buy just as easily. If you predict that a currency will increase in value, you can buy it.
If you think it will decrease, you can sell it. On the Forex market, you should choose symbols for trading. You can’t buy one currency and exchange it to your currency. For example, you can’t Buy GBP (British Pound) and convert it to AUD (Australian dollar), JPY (Japanese Yen), and Or USD (Us Dollar).
In the Forex market, you should choose your symbols in the beginning and the symbols defined in Forex broker like these: EURUSD, GBPUSD, AUDUSD, USDCHF, GBPJPY, NZDUSD, etc (we call them symbol) For instance, you choose EUR/USD for trading. It means that if you buy EUR/USD, you should convert it to USD when you decide to sell the EURO. You are not allowed to change it to GBP or JPY.
When you choose your symbol to trade, you have two options for trading Buy/Sell. If you think EUR value will decrease against USD, you can sell EUR/USD, and if you think EUR value will increase against the USD, you can buy EUR/USD.
What is Options Trading and How to Start?
On Options Trading, you can trade on Forex symbols like EUR/USD or GBP/USD or USD/CHF, but you should predict the market aim when it looks like a bet on the Forex market!
On Options Trading we say Call orders and Put orders. In fact, call on Options Trading means Buy and Put means Sell. There is two big difference between Forex market and Options market: 1-On Forex market you can hold your orders for a long time and close it every time that you like.
But On Options Trading, you have an expiration time. You can’t close or modify your orders until expire time. 2- On Forex market, your profit and loss is variable and depend on the market movement, but in Options Trading, your profit and loss is fixed. The Options broker offer you fixed return if you guess market movement correctly.
For example, CloseOption.com offer you up to 85% on EURUSD if you guess market movement accurately. Now maybe you think this is pure gambling system, and it’s not trading! Here I want to describe this question: https://www.closeoption.com/blog/compare-forex-competition-options-contest/
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Is Options Trading Gambling?
No, on gambling you should use mathematical possibility and gambling is not predictable at all. But Options Trading symbols are Forex trading symbols, and all financials markets are predictable if you have enough knowledge to analyse markets. How can you gamble on Options Trading or Forex market?
It’s your choice whether you enjoy trading by chance or by the knowledge, and experience. As you can see, the CloseOption web platform is very easy and straightforward.
Learning CloseOption Platform
As you can see the CloseOption web platform is very easy and straightforward.
Options Trading Terminology Account
It means your real money in your broker’s account.
Demo Account: This is a practice account and the numbers in the balance are fake, not real money.
Put or Low Option: Sell Symbols Call or High Option: Buy Symbols Balance: Total money in the broker. Broker: A company, Brokerage or Website that allow you to trade Options.
Current rate: it represents the current price of the asset.
Range option: Limited Options brokers offer you to trade on the range; for instance, the market price on EURUSD is 1.2010. You predict that the market price will be between 1.2020 and 1.2000 till the next 5 minutes then you can open Range Option.
Expiration Time: When will the option expire? The expiration time is accurate by seconds and milliseconds.
Rate of Profit: The percentage of money that you get as a return after trade expires.
Fundamental Analysis: Analyse and predict market movements according to the financial, political, geopolitical, demographic and macroeconomic news factors, etc.
Technical analysis: Another way to analyse the market according to the mathematical. It needed for technical analysers is historical price data and volume charts.
When Am I Ready for Options Real Trading ?
The answer is straightforward! You are ready when you earn a profit on your demo account.