Conventional ways of saving and investing money do not offer enough returns to retire early. Annual returns from such investments and savings may only be within a range of 2% to 10%, which alsodepend on theproper distribution of savings, constant monitoring and reshuffling investments. Banks and government bonds are safest among the lot, and proportionately they fetch the lowest return on investment. Stock markets bring higher yields, but risks are high too.
What about Earning Money with Binary Options?
Binary options offer a good earning potential to its traders and many professionals are making a fortune after trading on various trading platforms. Many traders have become wealthy enough to opt for early retirement after making money on binary options trading platforms. But the primary concern is whether it is easy to make millions by trading with binary options. Well, the truth is that it needs quite a time to understand binary options trading and acquire skills to analyze its tools, charts, and signals. For starting up, you can read a valuable binary options guide that will give you the necessary knowledge and make you learn about the different strategies for binary options trading.
You can plan for an early retirement after making money with binary options, but you should take some precautions and follow some golden rules.
Word of Caution
Leaving a regular job without having required temperament and learning with this type of trade, with the sole objective of developing a retirement nest egg from binary options trading is not a good idea.
Whether experienced or not, bourses are always a risky proposition. A few rules that need to be followed without fail are-
Have a Predefined Amount for Investing in Binary Options Market
This differs for person to person based on wealth levels, age, and responsibilities on shoulders. In general, if the individual is trying to save for retirement, then only 1/3rd should be in stock markets including binary options. Within this band, people may vary how much they want to invest in binary options and how much they want to keep in stock markets depending upon personal propensity to withstand the stress that accompanies risk.
Do not investall your money on any Single Trade
It is tempting not to, but limiting each trade to merely 5% of the risk amount may be a good way to earn money in this market. Since this is a separate account, and it may grow, the 5% may also grow. Likewise, it may also decrease without affecting other savings. Some people are fine right up to 10% in a single trade. But investing more than 10% of the entire predefined capital amount allocated for binary options trading on a single trade would be foolhardy.
Confine your overall binary options trades to 25% of the money as being too greedy can be extremely dangerous in this market.
Do not Chase Losses
This rule is valid for trading in stock markets, as well as binary options trades. Many people look at their losses and get nervous. They feel they have to make it up on the same day or same week or same month. In the process, they initiate more trades, without properly analyzing and end up making more losses. Quite often the trades are in the same option which is already offering negative returns. There has to be anacceptance that this is not working, so it needs to stop. Taking a break for a few days would help in coming back.
Analyze Stocks, Commodities, or Currencies underlying the Binary Options
The rule “no pain, no gain” is valid here as well. Studying the charts, and understanding the implications of any news on those charts is essential. There are binary options software tools that do much of the analysis, but that does not mean that the person should not understand those charts, and not verify whether the software is indeed generating the patterns as expected of it from the data. Advice received may or may not be reliable, or may be a bit late in coming.
Use Latest Technology
Speed is crucial for better gains. Buying latest and best gadgets available in the market can be rewarding in the long run. Set aside part of the returns from this market for expanding on theseapps and devices and spend time learning how to use the features.
Like Rome was not built in one day, it may be a while before the person learns how to trade in binary options and earn decent profits from these deals. Initiating a trade or two each day initially can keep losses to a minimum and give the required experience till a better understanding of thetradeandtools is achieved. After that, more time and resources can be devoted till decent nest egg is built for retirement from less than 1/3rd of total savings each year.