Tips, tips, tips! To become a better trader – in fact a better anything – you need to open your ears to what others have to say. Be curious and always welcome learning because you never know everything and maybe the guy next to you doesn’t either but he has a piece of knowledge he wants to share. The next guy will give you another piece and the other guy, another one. Gather them all, maybe starting with the next 9 tips. Since this is not a Top, don’t think that the last tip is less important than the first so pay attention to all.
1. Choose a Safe Broker
Two main parts make up successful trading: you and the broker. If you don’t know what you are doing and lose money left and right trading, how can you expect to hit it big in Binary Options? On the other hand, if you are a good trader but your broker scams you out of your money… how can you expect to hit it big in Binary Options? It doesn’t matter how much money you make if you can’t withdraw it, so your choice of brokerage is paramount.
2. Don’t Get Too Excited by the Bonus
I know this one can be tough to follow – I mean who doesn’t get excited at the thought of free money – but the Bonus given to you by your binary options broker is NOT free money. It cannot be withdrawn right away and more than that, it ties your own money to the platform until a certain trading volume is reached. The higher the Bonus, the higher the volume you need to trade afterwards and that’s why often times it’s better to pass on the bonus, or at least to accept a low one. For a more in-depth approach, read our article: Binary Options Bonus – Don’t Get Too Excited!!
3. Read the Terms and Conditions
All brokers have to make public this document which basically contains… well, the terms and conditions of the agreement between you and your broker. It describes what you are allowed to do, what you can’t do, your rights and obligations regarding your client–broker relationship, as well as the broker’s rights and obligations. Think about it: if you don’t know that the speed limit is 60 MPH, aren’t you more likely to break it? On the other hand if you think it’s 60 but instead it’s 100, won’t that mean that it will take you a lot longer to get where you want to? It’s simple: you have to know the rules of the game and the way to learn them is to read the T&C document. If what I said didn’t convince you, read our full article What You Should Know About Binary Options Before You Deposit – Terms And Conditions.
4. Spoken Words are Often Meaningless
The account manager or sales representative appointed to you by your broker will say more or less everything you need to hear in order to deposit more. They will say that you can withdraw your money immediately after receiving a bonus, or that they will give you some insured trades, without any strings attached, etc. Now hear this: if it’s not written in their Terms and Conditions document (or maybe in an e-mail from the company’s management), it can be changed at any time. You are not doing business with your account manager, but with the company (the brokerage). If your account manager agrees to something that contravenes the company’s policy, they can fire him (or say they did) and change the deal. Worst case scenario could go like this: Your account manager gives you 1,000% (one thousand percent!!!) bonus if you deposit 10K, saying that your money (the 10K) is available for withdraw even tomorrow if you want. When tomorrow comes, you want to withdraw, but guess what: another representative says: sorry, that is against our policy and your previous account manager was fired because he didn’t abide to company policy. Bottom line: you cannot withdraw because you have chosen to trust spoken words.
5. Don’t Sell the Farm but don’t be Cheap
When you deposit you need to make sure you deposit an amount that lets you feel comfortable in case it’s lost. But at the same time, it has to be a sum that allows some room for mistakes because in trading (especially during the early stages), mistakes happen. If your account cannot sustain the “accommodation” period, it’s likely to be wiped out before you can make up for the losses. On the other hand, having a too big account can scare you so choose wisely the amount you want to invest in the beginning. For further insights read My First Binary Options Deposit – Mr. Sucker and continue with Mr. Nice Guy and The Shark.
6. Try a Demo
This is one of the oldest tips in the book, but it needs to be here because lots of people underestimate the importance of trading virtual money before you risk the real dough. No matter how much you learn, you have to put your newly acquired skills to the test in a stress-free environment. Many brokers make you deposit first and only then give you a demo account but if you don’t want all that hassle and strings attached, check out our CommuniTraders platform which offers $20,000 Free virtual money that can be used to hone your binary options skills. Also, read Binary Options Demo Accounts – Everything You Need To Know.
7. Don’t AutoTraders
Maybe, just maybe there are good signal providers out there but to me it seems like all of them try to boast their knowledge and appear better than they are. When you hear wild promises of big bucks, low risk, rehashed and regurgitated stuff like that, just walk away and be prepared because around the next corner you’ll meet another guy who promises the same thing. 99% of them are FAKE. Oh and I almost forgot: NEVER let your broker/account manager trade for you.
8. Use a Well-Defined Strategy
This tip goes hand in hand with the one above. Don’t trust other people with your money and instead choose your own strategy, learn it and follow it to the letter. This way you will build your confidence and skills and you’ll be the one in control, not some unknown account manager or signal provider. It’s your money so trade it yourself. Don’t have a strategy? Guess what: we have a ton of strategies and we give them out for free.
9. Learn from the Mistakes of Others
Almost every other day I hear about a guy who deposited some thousand bucks with an unknown broker because his account manager told him he will double it by the end of the month. In one week it was all gone and he was asked to deposit more because more money means better risk management. I see this story over and over again on our forum, on other forums, in the comments section, in chat rooms, on complaint boards… everywhere. People simply don’t learn. If you hear this happened to several other people, why would you still try it? Learn from the mistakes of others or accept the loss.
The tips I’ve given you so far will help a lot but they won’t make you a good trader. For that you’ll have to take your time and visit our Binary Options School – and not just visit it, but attend it. You need to learn , practice and then apply common sense when dealing with brokers and signal service providers or dream sellers. It’s a tough trading world out there, but hey, all good things are hard to get and the rewards are definitely worth it, so put your thinking cap on and start making the best of it.