You can trade a wide range of things with binary options. You can trade commodities such as oil, wheat, coffee, gold and silver. You can trade stocks like IBM, Facebook, Google, you name it. You can trade forex currency pairs like the EUR/USD and of course the CAD/USD. You can trade larger indices as well.
The short answer is you can trade all sorts of things via binary options. And you do not have to be an expert to do it.
Binary trading is easy by creation. It is easy to do, that is. It is not so easy to win consistently. You would think that if you have a 50/50 shot of picking the right price movement that you would win most of your trades. The thing to remember is, that you have to win slightly more than the majority of your trades and the brokers themselves will make their money because the returns they are offering, while extremely high, are not 100% of your investment. If you lose the trade then your investment is gone, at least for most brokers.
The exception is AnyOption (www.anyoption.com) as they are one of the few sites that give kick backs on losing trades.
How is Trading Binary Options Different Than Normal Investing
It is different in many ways the more traditional stock option purchasing. The biggest and most straight forward difference is that when you are trading binary options you are never actually purchasing the underlying asset. You are only predicting the way the price moves. You never actually take ownership of the underlying asset, you are just betting which way the price is going to move.
Another important factor that is different about binary trading than regular options is that with binaries, you are not concerned with that magnitude of movement in order to determine the amount of return. With binary options you either win or lose. You do not win a lot or little, you either get the full return or you get the full loss. So, when trading binary options you do not care how much gold goes up, you only care that gold goes up. Your return is the same if you bet gold was going up and it moves up a few pips or if it moves up 100 pips, if you win, you win the same amount of money.
Trading forex binary options is different than the typical and more complex forex trading that has dominated the financial markets for quite a while. With more traditional forex you need to set up multiple parameters, stop losses, and entry and exit points in order to make money. It does not work that way with bino’s. You have a one or the other choice to make and if you are right you win and if you are wrong you lose. It sounds simple, and the execution is. Winning over the long term is hard.