In this paper we will explain the reasons why most people lose money in trading, why they would need artificial intelligence or algorithmic trading software or robots, why some binary option robots are a real scam, which robots to avoid and which robots are worth buying.
What is a binary option?
According to Wikipedia, “binary option is a type of option in which the payoff can take only two possible outcomes, either some fixed monetary amount of some asset or nothing at all (in contrast to ordinary financial options that typically have a continuous spectrum of payoff).“
What it means is that if you buy a binary option and the trade is successful, you make between 70% and 85% of return, if the trade is not successful you lose all.
So for example if you invest $100 you end up with $170-185 if the trade is successful, but you end up with nothing if you lose the trade.
Why do people fail in making money trading?
The main reason why people fail to make money by trading in the financial markets is not due to lack of knowledge or tools, but most of the times is lack of discipline. Until they make money everything is ok and the discipline is not an issue; as they lose the first trades, they get eager to recover the losses, and quite often this “urgency” creates an undisciplined way of trading (in particular anticipating the entry point, making operations even if the trading signal is not there, increasing the value of the trade against money management principles).
What do people need to make money?
A good way of overcoming the problem of staying disciplined is to have a software that generates trading signals (without necessarily being 100% automated in processing even the actual trades); having a trading software or robot that will guide you in avoiding the main mistakes you will (probably) not anticipate the entry point, you will (probably) not enter if there are not the trading conditions, you will (probably) stick to sane money management rules.
Why using automated or semiautomated trading software?
Advantages
More trading signals and more trades.
No emotions
Automated trading
Disadvantages
No learning curve
You can’t modify the robot
10 Tips to understand which binary robots might be a “scam” and which ones are “honest” binary trading software or robots
Tip 1: avoid binary robots without a “REAL” trial period
A REAL trial period is when you do not have to open a binary account in order to use the robot. Why? Because the vendor will receive a CPA from the broker in exchange of any new account opened and funded, and guess what? If the robot does not work, even if you end up not losing much money, you spend nothing for the robot but the vendor of the robot still receives the CPA and that’s enough for him.
Optionbot for example, one of the most sold binary robots, is quite clear: when the trial period expires you have to buy it, but you do not necessarily need to open an account to try it in the first 7 days.
The same for Auto Binary Signals: no technical need to open an account, they are aggressive in upselling you other products, but that is understandable.
Even less aggressive is Binary Power Bot: no need of opening a binary account, no upsells, but simply buy the robot and go!
Tip 2: the website of the vendor must be at least 1 year old
Typically, the vendors of the robots which are intended only the get the CPA have new websites, and actually the vendors open on purpose new sites to promote a “CPA-producing” robot and then leave the site to quietly die.
To check the age simply go to Whois page and put the url of the site; under the “creation date” line you will see how old the website is.
Tip 3: you should see real statements showing real trades
Do not trust blindly “photoshop” pictures (as I call them) published in the vendor website before you have made a thourough investigation.
Real statements are those where you see at least the full session and not just a few trades of a session, as it might be that some trades were good and some were bad, and the whole session was negative.
Tip 4: Beware of the vendors who invite you to buy the robot after the trial period “using the money made by trading with the robot during the same trial period” and using a binary account that you will open from the robot software.
Also in this case, the risk of having a robot software just aiming at getting CPAs is even higher.
Tip 5 : read the reviews of the robot
It seems trivial to say this, but it is always a good idea to read reviews; even though some could be “guided”, the higher the number of the votes the more reliable the reviews are.
Tip 6: check if the vendor offers a money-back guarantee
Many vendors, expecially those selling through affiliate networks, do offer 60-days money back guarantee, meaning that you can get back the money if you are not satisfied within a relatively long period, usually 30 or 60 days and with the “no questions asked” formula.
Tip 7: send an email to the vendor customer support and check the responsiveness of the vendor in answering to your email
Tip 8: do prefer vendors with phone numbers published in the Contact page
Also this is a sign of seriousness and professionality.
Tip 9: beware of incredibly high returns
Some are even promising 100% winning ratio, that is they never lose!
Tip 10: read carefully the information given by the vendor
The majority of the vendors declare everything, but you have to be careful in reading all the information, including the Terms & Conditions of the vendor.
Our preferred binary option robots
Optionbot
Many years in the market, good customer support by email and by phone, real-free trial without having to open an account, 60-days money back guarantee: this is Optionbot, a real-time trading platform generating entry signals.
It is not automated, as you have to manually execute the binary purchase orders.
Highly recommended.
More info at http://www.thebinaryoptioner.com/binary-options-trading-r...
Auto Binary Signals
Auto Binary Signals offer trading signals on binary options on a comprehensive set of assets, not limited to Forex binary options but including stock indices, stock and commodities binary options.
There is no obligation to open an account, and also in this case there is a 60-days money back guaranteed.
More info at http://www.thebinaryoptioner.com/binary-options-trading-robots/auto-binary-options-robot/
Binary Power Bot
Binary Power Bot is an Expert Advisor for Metatrader with 60-days money back guarantee. It is not a pure binary robot, as originally it was a Forex robot and “adapted” to be used also for binary options.
Binary Power Bot could be used mainly as a trend indicator, in combination with other trading systems.
For more information you can read all the post and news in our blog http://www.thebinaryoptioner.com/
Contact
info@thebinaryoptioner.com
