Do you know what binary options are and would you risk investing in them?

Earning money online is an idea that many are interested not only because of how easy it is but also because of the many ways that exist to do it.

One of them is investments in binary options. These are a type of financial contract in which the value of an asset is predicted in a stock market and in a certain time, that is, to bet on whether it will go up or down.

“A couple of years ago some people imagined making option-type investments but that were not on the stock market, that is, that they were decentralized. Thus they created companies and began to put platforms so that people could make choices ”, explained Marcelo Granada, academic director of Investopi.

According to the expert, those who access binary options investment generally resort to speculation, doing the following exercise: if the person considers that the asset they are betting on is going to go up, they purchase the shares, but if he thinks it is going to go down, he sells them.

“In binary options one does not play to pay the premium – options insurance that ensures that the shares that are bought are sold at the value at which they were acquired – here one plays all or nothing, as in a casino” , assured Granada.

In this game there are only two possibilities: to win very large amounts, there is talk of a 70% to 80% profit when it is correct; and lose 100% of what was invested. “When I buy a binary option, I am expecting the asset to rise within a minute, an hour or a month, always bearing in mind that the final result occurs at the end of the contract,” said Granada.

For example, a person buys an asset with a one-minute contract. If in that time the asset rose one point, the person earned 70% or 80% on the value of the investment. But, if it did not go up one point or stayed down, the person loses the entire investment.

“Let’s think about roulette in the casino. When you play, you bet on red or black and one of the two falls, unless it lands on the double zero, which is very difficult but I can pass. In binary options this does not happen, because the asset has to go up one point, if it does not go up or down, it is lost. And if he stays still, too ”, explained the expert.

HOW AND WHERE ARE THEY DONE?

To make this type of investment there are many platforms and applications. According to Granada, due to the way they work, there are between one or two binary options companies registered in the United States to carry out this financial movement and they are conditioned to receive only clients of North American nationality.

However, in the rest of the world, there are basic restrictions on this financial movement. “They are done online and the investment can be from 5 dollars to 10 dollars and they have platforms to do it on the web or mobile,” said Granada.

Doing so is simple. They are carried out through online brokers, intermediaries in the purchase and sale of shares on the Stock Exchange.

It is necessary to search for the best binary options brokers, which are reliable and avoid brokers who have a bad reputation. There they will ask for a registration and depending on what you want to invest, they will accept deposits in dollars and euros.

When entering, the asset must be selected indicating the bet to be made:

• PUT: is the right to sell. It is chosen when the asset is predicted to go down.
• CALL: is the interest in buying. It is used when the asset is going to go up.

WHAT DO YOU NEED TO KNOW TO DO IT?

According to the expert, there are analysts who have managed to obtain large profits with binary options, however they achieved this with the knowledge they had on the subject.

“You need to know fundamental technical analysis and be experts. Investing in the stock business is how to drive a truck, investing in binary options is how to drive a Formula 1 car, there are few people who do it, “said the expert.

Faced with this, Granada emphasized that if you do not have knowledge or experience with the markets, it is better not to access this financial movement.

In addition, the expert added that this investment system can become dangerous because, as private companies are the ones that issue the options, they could manipulate the results.