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Topic  :  Binary Options Hedging Explained - Profit Slowly But Safe
อาทิตย์ ที่ 16 เดือน มกราคม พ.ศ.2565  เข้าชม : 17 
Start by : Loren
IP : 83.142.54.XXX

Binary Options Hedging Explained – Profit Slowly but Safe. Full Review of Binary Options Hedging Strategy for Binary Options Trading. I_ve been thinking lately: being a good technical analyst but also aware of the fundamental aspects like news and economic data or political events will definitely make you a better trader_but not a complete one. In order to achieve the next level in our trading, we must learn to manage risk. There are different techniques of doing that, ranging from simple ones to extremely complex but the best are the ones that you can understand and comfortably use.

My friend Michael Hodges, aka "The Geek" shares my view on the need for controlling risk and extends a helping hand by explaining in detail a widely respected technique called Hedging. The full article can be found here: http://tmhughes.hubpages.com/hub/Hedging-Strategies-For-Binary-Options-Traders First question that comes to mind is "What is hedging?" Michael offers a perfectly good and easy to understand explanation: "A hedge or hedging strategy is a financial position that seeks to lock in gains or prevent losses from trading and investing." Ok so we learned that hedging can protect us against losses and lock in profits but how can we achieve that?

The easiest way is by creating an off-set position, in other words, a Buy is hedged by a Sell and a Sell is hedged by a Buy. In Forex or Vanilla Options, perfect (or rather near perfect) hedges can be created but in Binary Options, it_s a bit harder. Anyway, a perfect hedge will bring zero profit so we don_t need it, miswan robot forex trader I hope you agree. Don_t worry, we_ll get to the bottom of this soon. If I try to hedge a Binary Call with a Binary Put, things aren_t so good for me because if I invest $100 on the Call and $100 on the Put, that adds up to a $200 investment.

Assuming my payout is 70% and the Out of the Money refund is 15%, automated forex robot if price goes up I win $70 on the Call and lose $85 on the Put. The total result is a loss of $15 and that_s not so good. Same thing happens if price goes down so what we learn from this is that you cannot limit risk just by opening two opposite Binary Options trades with no bias. Ok, here_s where the Geek steps in to help by explaining that you need to have a direction in mind and only then apply the hedging strategy.

Let_s assume that our analysis points towards a bullish move so we invest $100 in a Call and in order to limit the risk, we invest some money in a Put_but a smaller amount. After all, our view is a bullish one and it is normal to invest more on the Call. This is the little trick proposed by the Geek and it_s a good one. 

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