Every day millions of transactions are made in stocks, commodities, Forex and other financial markets. Thousands of companies, tens of thousands of investors and millions of home-based traders are involved in this exercise on a daily basis.
Home-based traders have two main paths to follow in this regard:
There are traders who analyze the market based on their experience and skills, while sometimes follow their hunch.
On the other hand, there are those who follow some kind of computer algorithm or computer program to conduct their trade.
The second types of traders rely on trading signals to make the trade. These signals can be in the form of SMS, E-mail or through an app.
These signals are usually time-sensitive and remain applicable only for a certain time limitation, and are usually easy to use, even for beginners.
Following the popularity of binary options in general, many have tried to use binary options signals. Binary signals are considered to be among the easiest to use due to the inherent simplicity of the trades.
However, you must be aware of its various aspects before you finally make a decision. This article will list down 5 of the most important things that you should know before joining a binary signals service.
- No apparent link between cost and profitability
Various binary signal services are available in today’s market. While some of these services are completely free, other charge certain amount of money.
The range of subscription charges can vary from $30 to $200 per month. However, it is extremely important to discuss here that no real correlation has been found between the cost of subscription and profitability. Some cheaper services were seen to be very good while some expensive ones were found to be scams.
Therefore, it is important to consider other factors, such as reputation and success rate of existing subscribers, before joining any such service. Many people have found different free service providers to be very helpful in terms of earning a reasonable amount of profits.
- Free signals are not truly free
Earlier it has been discussed that many free signal services provide hugely beneficial signals in terms of profitability.
However, it does not mean that you can simply subscribe and start receiving free signals. There is a small catch here.
Any service provider providing free binary signals will need you to open a trading account with their broker. You will also be expected to deposit at least a minimum amount of money in that account.
Usually $250 is the minimum money required in such cases but if can vary.
This matter, however, should not be a big concern if you are serious about such trading as you need this account anyways in order to execute your trades, or have the signal service’s robot execute the trades.
- Signals are not always automatic
While most signals are developed with the help of computer algorithms, it is not always the case. Some companies employ a team of experienced traders who conduct trades on regular basis and then update their subscribers with this trade.
So, the signals you are receiving can be algorithm-generated or human-generated. In some cases, it can be a mixture of both. However, it should not be a matter of concern as long as you are finding them helpful.
- Manual vs. Automated trading:
Once you are granted access to the trading platform, you usually have the option to either choose automatic trading or manual trading. In automatic trading, you allow the system to automatically make investments as soon as signals are received.
Obviously, you get to choose various settings, such as the number of trades and amounts etc. In manual setting, however, you wait for each signal to arrive and then decide whether or not to move forward with the trade.
- Beware of scams
Before investing in binary options signal services, you should check whether the service has received good reviews or there are any live testing results available, so you can be sure it is not a scam.