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Binary Options: The Facts And The Fiction

Binary Options: The Facts And The Fiction

Binary options are a rapidly growing business. More and more brokers with more and more regulations are popping up every day. The problem is that the industry is still operating on the fringes of the internet with regulatory agencies operating on a very localized basis. This, along with the high propensity for scams, has led to a lot of confusion about what binary options are, where they come from, and if you should be trading them.

The good news is: I have been tracking the industry for many years and am here to fill you in on the facts and the fiction surrounding this simplified form of trading.

Fact – Binary Options Are An Easier Way To Trade Financial Markets

As a tool for speculation they are easier to use than most. When compared to equity investing, standardized options, futures and forex it is better described as a simplified form of trading because the account requirements and mechanics of trading are much different. Futures, forex, commodities and standard options all require margin accounts and can expose you to unlimited risk. Depending on the type of trading, leverage can be as low as 10:1 and as high as 250:1 or more at some forex brokers.

Margin accounts are highly levered accounts that can make you a lot of money really fast, but can also completely wipe you out of the market at the drop of a hat. The most difficult aspect of trading futures, forex or options is taking profits. These types of positions are subject to every move of the market, many are affected by the passage of time and all are impeded by slippage. Positions that move as predicted don’t always generate profits.

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Trading binary is much simpler than that. You pay a set price at the open of the trade, are only exposed to that amount of loss, and have a fixed return upon expiration of the contract. All that is required is to move the underlying asset in the direction of choice.

Fiction – Binary Options Trading Is Easy

Let me rephrase that, successful binary options trading is easy. It’s easy to trade binary, all you have to do is do it, but being successful is not easy. By reading the average run of broker homepage, you’d think all it takes is to pick an asset, choose a direction and reap the profits but the reality is that more than 90% of all traders get washed out of the market. The same can be said for other forms of trading as well, it’s pretty easy to buy and sell securities, all it takes is an account with a broker and you are in business. Doing it successfully, making consistent profits, is very hard.

Profitable speculators spend years, if not decades, learning the market in which they trade. They have an in depth knowledge of market mechanics, as well as technical and fundamental analysis that allow them to form educated opinions, thus positioning their accounts to take advantage of these opinions. Just because binary trading is simplified in terms of account mechanics, margin and profit structure does not mean trading them is any less hard. The underlying market, fundamental and technical analysis are the same, requiring the same knowledge and experience to produce profits

Fact – All Binary Options Are The Same

In essence it’s true that all binary options are the same. Binary options are a fixed return investment vehicle with a fixed price, a fixed set of conditions to be profitable. and a fixed payout upon expiration. Regardless of the style of trading, all that is required is for the preset conditions to be met.

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In the case of call/put and high/low style trading, if a trader buys a call or high position all it needs to profit is for the price of the underlying asset to move higher than the strike price at which the option was bought. The same is true for puts, just in reverse. Prices must fall or move lower than the strike price to profit. One touch options require prices to touch a set strike only one time, while range options require asset prices to remain in a range.

Fiction – All Binary Options Are The Same.

The basic structure of all binary options is the same – if yes, then you profit; if no, then you lose. The reality is that not all binary options are the same. There are at least two major classifications with some smaller categories within those two. The most important difference to understand is the method of trading. One style is based on spot prices, the other is based on strike prices.

The first category is best represented by the CySEC style of trading which is popular in Europe and other international locations. This style has only one strike price, the price of the underlying asset at time of purchase. The price of the option is whatever amount the trader chooses, with payout equaling investment plus a set return.

The second style, found primarily in the United States, is based on strike prices and often referred to 0-100 options. This style utilizes a list of set strikes whose prices range between 0 and 100 depending on whether they are higher or lower than the spot price. Traders choose strike and expiry. If the asset spot price closes above/below that strike they receive $100 and profit the difference between purchase price and pay out.

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Fact – You Can Make Fast Money Trading Binary

It is true, payouts for most types of binary options start around 70% and go up to over 500% depending on what type of options you are trading. Believe it or not, US regulated exchanges like NADEX and Cantor Exchange have some of the highest payouts for standard call/put style binaries. An at-the-money option may cost $50 and pay $100 at expiration for a return of 100%, higher than the average 80% return you find at a CySEC/EU style broker. On top of high returns is a high speed of return. Some binaries expire in as short as 60 seconds, others range from 5 minutes to 1 hour, 1 day or 1 week.

Fiction – You Can Get Rich Quick Trading Binary

It is possible to get rich trading but it is not likely. First of all, trading is risky and difficult to do successfully. If it was possible to get rich quick then everybody would do it and no one would be able to make money with get-rich-quick-schemes. The speed of trading is also working against the average trader. It is possible to lose money just as fast as it is to win it. On top of that many brokers brokers have stops in place to prevent any wild successes. These are often found at off-shore style brokers. The most common way is to limit the size of the trades. If you can’t make a big trade then you can’t make a big win. Some will limit trade size to a percent of your account, so any trades above that amount won’t count toward your balance. This is an often overlooked fact that has caused confusion for many would-be traders in the past.

Fact – There Are A Lot Of Scams In The Binary Options Industry

You have to be extremely careful when looking at any broker, offer or service. Scams range from fake brokers to fake regulators and can include complex sales funnels, shady account managers, auto traders, trading software, robots, signals and just about anything else a crafty marketer can think up. One reason is a lack of international standard or regulation. The industry came to life in the gray areas between countries and regulations. Since the industry exists almost entirely on the internet regulating it is very difficult. Anyone with a URL and the money to buy a trading platform software package can open a new broker or signal service in a matter of days.

Fiction – All Binary Options Brokers Are Scams

This is not true. There have always been brokers operating legitimately and the number of those is only growing. At the same time, regulators around the world are stepping up and taking control of the situation in their region. The US was the first to adopt such rules and is the strictest of any jurisdiction. At this time there are only two places to trade, NADEX and Cantor Exchange – although Cantor Exchange is working with top technology providers to create opportunity for even more brokerages to begin business.

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Cypress started regulation in Europe when CySEC recognized binary as a financial tool and not just gambling. Since then, several developments have helped to cement this form of trading in the EU including a recent Dutch ruling on binary as well as impending regulation from Britain’s Financial Conduct Authority. Other nations which have adopted regulations include Japan, Australia, New Zealand and Canada.

The trouble for would be traders is two-fold. First, there are more website offering scams than there are fighting them and new scams appear every day. The second problem is how the lack of centralized regulation causes as much confusion as it solves. This 24Option scam review is a good example. This broker is well known (more on this below), has been in operation for many years, is CySEC regulated, and yet still receives warnings from the US and Canada.

Fact – Binary Options Is Here To Stay

Many have doubted the longevity of this style of trading but sources show it is only gaining momentum. In Europe, TechFinancials has become the first technology provider and broker to become a publicly traded company. This move shows the public’s acceptance of binary as a viable business model, if not a legitimate form of trading. At the same time, 24Options (the flagship brand of TechFinancials) has partnered with leading sports teams for mutually advantageous advertising, as well as having dozens of other brands. In the US, trading volume at NADEX grows rapidly and Cantor Exchange is on the cusp of opening the market wide open. Cantor is focused on bringing the same type of white label access to the US as is currently seen in Europe. This will allow new brokers to open up shop and provide binary alongside their proprietary products. Three technology providers are part of the process thus far: SpotOption, Tradologic and TechFinancials.

The Bottom Line In Binary Options

Binary options are here and they are gaining in popularity and safety. They are embraced by the worlds financial communities, entering the purview of regulators. Cantor Exchange and NADEX are leading the charge in the US, while at the same time others are making moves to solidify the industry in Europe. CySEC paved the way there and now other countries within the union are getting on board. The decision of the Dutch court to uphold CySEC, the MiFIB and EU Financial Passport is a landmark event and one that will have positive repercussions throughout the EU and possibly the rest of the world. This affect is already being seen in England where regulators and legislators are making plans to establish London as a hub of binary trading.

Meanwhile, the industry is still plagued by scams so it is very important for anyone pursuing this avenue to do their due diligence. There is a lot of gray area in which scammers and shady brokers can operate. There’s no end to depth of scams these people will perpetrate. The only true protection is to stick with reputable brokers that are regulated in the country in which you reside.

Featured photo credit: www.vpsi.org via commons.wikimedia.org

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Binary Options: The Facts And The Fiction

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Published on January 17, 2020

How to Eat Healthy on a Budget (The Definitive Guide)

How to Eat Healthy on a Budget (The Definitive Guide)

Have you ever looked at health gurus and wondered how on earth they can afford all that health food? Or maybe you’ve tried multiple times to start eating healthy only to find the $600 monthly budget overwhelming?

If you’re anything like me, you know exactly what I’m talking about! I absolutely understand the sinking feeling of looking back over a grocery budget and finding you went way over what you intended. And besides that, it can be hard to justify buying a tiny $5 bag of carrot chips while a $1 mound of potato chips is sitting right next door.

My husband and I recently ran into that struggle. We got married this past year and soon found ourselves trying to balance 12 hour work-days with keeping our relationship strong and trying to keep our personal businesses afloat. Granted, our budget was the one thing that took a hit! After we started tracking our spending, we were shocked to see we were spending over $1000 a month just on food! A little planning cleared that right up.

So, how to eat healthy on a budget?

Here’re the top tips I learned that helped us shave over $600 monthly off of our food budget so we could reinvest that in the areas that really mattered to us![1]

1. Meal Plan

You’ve probably heard the saying “Fail to Plan, Plan to Fail” right? Well, this saying couldn’t be any more true than in the area of healthy budgeting! The fact is, most healthy foods don’t actually cost that much… the pre-made time saving ones do!

If you go about creating a healthy meal plan within your budget, you could easily cut costs down to around the same price you are paying for junk food.

Meal planning is as simple as working in foods you already have in your fridge/freezer, adding in several meals with simple ingredients and seasonal veggies, and breaking it down into a shopping list.

Often, finding a few meals to make in big batches will save you the most money in the long run, which leads me to my next point.

2. Cook in Bulk

Not only will cooking in bulk save you a whole lot of time, it will save you a whole lot of money too! Believe it or not, if you find meals to make with similar ingredients, you can easily save more money than when you were eating unhealthy.

Don’t believe me? Just look at a $4 frozen pasta dinner. Now, sub that with a veggie pasta dinner. 5 zuchinni ($3), Pasta sauce ($2.50), and chicken ($5) could last you a full 5 meals which adds up to a whopping total of just over $1 per meal!

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That’s not even digging in to all the money you will save from fast-food. Trust me, a little $10 spent here and there add up! You’ll be saving a whopping amount from all the meal prep you will do!

3. Cook all Your Meals in One Day

The science behind this is 2-fold.

Number one, if you have lots of meals to grab and go, you will be far less likely to binge on pricier food when you get hungry. Let’s be real, you’re not going to spend 1 hour cooking when hub-n’-grub is at your bekon-call!

Number 2, meal prepping ahead of time will help you stick to your meal plan better when you’re not in the mood. Let’s face it, we’re all going to have days when protein and veggies doesn’t exactly sound appealing. But, if you have a full meal that’s quick to grab in the fridge, it will be easier for you to fill up on the good stuff rather than spending money on what you don’t really need.

4. Cut Back on Snacks and Specialty Items

I can almost hear you from across the screen. “But, I thought snacks were good for me!” Here’s the deal: Snacks are expensive! And healthy snacks, oh my goodness, say goodbye to your paycheck!

Look, I’m definitely not saying that healthy snacks are bad. Quite frankly, I would much rather you chow down on Halo Top than a triple-butterfinger-fudge sundae. It’s just that… healthy snacks are why eating healthy gets a bad rap for being expensive.

Look at it this way: You could either buy a week’s worth of groceries full of chicken, fish, beans, veggies, and fruits for $30. Or, you can spend that $30 on six snacks that will leave you hungry for more.

What’s more, the ingredients for gluten-free baked goods, sugar free substitutes, or protein powders alone will add up to you eating a full week’s budget in one sitting. By all means, if you want to work some yummy items into your budget, do it! But don’t confuse that extra monthly $300 of delicacies as a necessity. Your body and budget will thank you!

5. Satisfy Yourself with Your Favorite Subs

We all have an emotional tie to food. Maybe pasta reminds you of home! Or maybe a fresh-baked pizza is what gives you a feeling of comfort. Whatever you favorite food, find a way to work it into your budget in the best way.

We’re only human, and depriving ourselves of what we love will never end well. More often than not actually, it ends in take-out or a pricey-premade substitute.

Instead of finding yourself in this situation, find a way to make your favorite foods fit your budget. Zuchinni noodle pasta might just give you that feeling of home without breaking the bank. Or maybe you could google a healthy pizza alternative you would like that you could make at home. Often, something similar to your craving will be enough to give you a sense of satisfaction.

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Or, just buy your cheat meal and save it for a special day. That’s okay too!

6. Stick to the Cheaper Proteins

Okay, I know we all love steak. Unfortunately, buying pre-cooked or expensive cuts of meat are one of the easiest ways to drain a budget.

Instead of purchasing those, try buying frozen chicken or eggs. A 5 lb bag of frozen chicken can be as cheap as $5, and you can buy a whole weeks worth of eggs for just over $1. You could even try going vegetarian for a few meals if you really want to cut down on costs!

7. Buy Frozen Fruits and Veggies

I know, we all love our fresh fruits and veggies! However, sometimes frozen might be the way to go if you’re looking to cut costs!

Fruits and veggies are easiest to ship when frozen, making them a much cheaper option. Contrary to popular belief, scientists have actually found that frozen might be better for you too![2]

The reason is, frozen produce is picked at its prime and shipped immediately. Fresh fruit tends to be picked much earlier so it will ripen while being shipped. Not only does this make it less nutrient dense, but sometimes the fruits are actually pumped with artificial flavors to make up for the lack of real nutrients.

While I’m all for fresh fruits and veggies, don’t feel guilty if you opt for frozen foods due to a budget.

8. Bump up the Calories with Rice and Beans

The problem some people find when trying to eat healthy is that it can be hard to get the amount of calories you need without relying on expensive “specialty” items. Instead of stocking up on pricey gluten-free breads and pasta, I say stick to simple rice and beans as the bulk of your meals.

Brown Rice is very cheap and easy to use as a base for bowls and dishes. Likewise, beans can add a bit of fiber making you feel full and satisfied without having to spend a lot of money.

If you are trying to cut on body fat, use extra veggies as the bulk of your meal and add in rice and beans as a filler.

9. Try Acai Bowls

Acai Bowls can be a really cheap and satisfying meal as long as you do it right.

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You can find cheap fruits at most stores or just freeze your fresh fruits before it goes bad.

Making your own granola can save you a lot of money as well. The total cost for this delicious meal should only add up to a few dollars compared to triple that price if you were to buy one pre-made.

10. Make Your Own Meal Kits

Do you like your meals freshly cooked? Sending meal kits to your doorstep is an easy way to drain your budget. Instead, try making your meal kit at home! Not only is it fun, you will easily get a delicious taste.

Simply find a few simple meal cards or print some out and fill a ziplock with the ingredients for each specific day. Don’t know what recipe to make? Another option is to order one month of meal kits and recycle the recipe into ingredients for the upcoming months with ingredients you picked up from the store.

11. Don’t Drink Your Calories

A few dollars spent here and there can really add up! Just as with specialty items, healthy drinks can be a blackhole for you. An energy drink and kombucha and coffee each day could easily have you spending and extra $300 each month!

I you really need a special drink fix, try making your favorites at home. Bring a coffee in, make kombucha, or even try making lemonade with stevia or a healthy soda. You’ll be surprised w hat a big difference such a small change can make on your budget!

12. Buy Cheap Online

Just like anything else, it pays to be prepared. Buying foods from online retailers can be a really affordable way to save money as long as you’re prepared.

Plan ahead for those more expensive specialty items you can’t live without. It will save you tons of money compared to having to buy food from a specialty store.

13. Don’t Fret about the Clean Fifteen

One of the huge things that can mess with a person’s budget is eating organic. For the record, I am 110% all for eating organic whenever you can. However, for some people, it can be hard to make organic food fit into a budget.

Instead of scratching healthy eating for a smaller budget, try to buy meat and the dirty dozen organic, and don’t go crazy about the rest. The clean fifteen are the fifteen safest foods to buy that aren’t organic! Meanwhile, the dirty dozen is the most worthwhile avoiding. According to Produce Retailer, these are the dirty dozens:[3]

  1. Strawberries
  2. Spinach
  3. Kale
  4. Nectarines
  5. Apples
  6. Grapes
  7. Peaches
  8. Cherries
  9. Pears
  10. Tomatoes
  11. Celery
  12. Potatoes

14. Pay Attention to Storage

Keeping the food you have is just as important as how much food is in the first place. Try to stay on top of how much produce you can actually use before it goes bad. It might not be a bad idea to pencil an extra shopping trip in the middle of the week to keep food fresh.

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Investing in good food storage containers could go a long way in saving you in the long run as well.

15. Freeze Food Before it Goes Bad

Instead of getting mad at yourself at the end of the week for all the wilted produce you need to throw out, try freezing it before you get to that point.

Most frozen veggies will taste delicious in stir fries and soups. You can freeze fruits to make sorbet or smoothies. Frozen greens can be chopped up and tossed into just about anything for a nutrient boost!

16. Consider Ditching Most Supplements and Powders

I have nothing against superfood powders and supplements. However, if your budget is tight, it can be hard to fit supplements and powders in.

Instead of adding in powders, add extra nutrients to you food. Add lots of greens and veggies to all your meals to meet your nutrient needs. If you need a specific supplement, you can find great deals online as well!

17. Use Budget App

There are so many great apps you can download for free. One of my current favorite is HoneyDue because you can track your budget easily with your spouse. There are many options available, just find the one that you’re most likely to use. The ones that download your spendings automatically are often the easiest and will give you a more accurate number.

My husband and I use the same app, but have a separate budget for each of our weekly food plan and for our additional snacks. Keeping things separate can often be helpful to know exactly where your money is going. Plus, it can help hold you accountable if you have a significant other you are sharing money with.

18. Use What you Have

Most people have unused protein powders lying around in their cabinets. Instead of letting that go to waste, work them into your meal plan. Protein powders can make amazing doughnuts, pastries, or pancakes!

19. Enjoy the Process!

Finding ways to enjoy your new lifestyle will be helpful in sticking to it long term. Find fun in seeing how much you can save each month. Make a competition with someone to see who can stick to the lowest budget and create something fun to do for the winner with some of the money saved! Blast some music in the kitchen while cooking your new recipes.

Budgeting and health doesn’t have to be a drag. Make it fun and you’ll enjoy your new lifestyle long-term!

Featured photo credit: kevin laminto via unsplash.com

Reference

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