Australia is one of the strongest countries in terms of finance and investment banking. A place of strong economic foundation and, at the same time, one where you can find hundreds of tourist hotspots and breathtaking views. As a binary options trader living in Australia, you’ll have to form good investment habits if you are to succeed in this relatively nascent but absolutely legitimate career path. It’s not for the faint-hearted, the undisciplined, and the inexperienced, but with the four tips below, you’ll be able to profit from the financial market in no time.
Understanding Binary Options Fundamentals
Understand the general definitions of binary options contracts and trading as a career separately and then intersect the knowledge together once you’ve formed a good grasp of both concepts. It can be more complex to tackle binary options trading if you try and start with harder concepts, such as hedging or Ichimoku Clouds. Knowing the basics first is key to increasing your knowledge base over time as you can always look back on these basic concepts for help whenever you are stuck with a more difficult terminology or principle.
Creating a Journal
Journals, be it in a notebook or a spreadsheet, is a good habit to form as a trader and investor. Over time, you’ll accrue so many trades and positions that it’ll be difficult for you to remember them all mentally. A visual representation of your trades is a great way to identify historical patterns about price action and about how you act as a trader. It also gives you a clearer perspective of what to do next. Should you continue trading at the pace you are trading currently? Do you need to increase or decrease the amount of trades per day or the total loss/profit potential you are targeting per trade? A journal will help you determine these important questions.
Listening to Others
90 percent of traders fail. This is a statistic you should remember at all times when trading, not to scare you but to serve as a constant reminder that not everyone you’ll meet and greet in the trading community is worth listening to. Even the best financial pundits of Wall Street get it wrong more frequently than they’d care to share to the public. Trading binary options in Australia is anyone’s game. An inexperienced trader has as much chance of predicting the next right price direction as someone who’s been in the business for decades. Of course, this doesn’t mean you should always trade the opposite of what you are being told to do. Instead, use your own gut instinct and do your own research before deciding anything.
Minimizing Dollar Risks
Risk is ever-present in the trading realm. True acceptance of its presence is paramount to trading success. Minimize dollar risk by trading only a portion of your available funds at any given time and using only a percentage of your allowed broker leverage. TorOption binary options broker, for instance, can offer leverage of up to 1:500, which means you can trade $500 worth of assets for every $1 you invest. This sounds exciting as it can accelerate your account growth by 500 times, but the truth is it can also make you lose money at the same rate. Leverage is a double-edged sword that must be wielded with caution.
Forming good habits as a binary options trader will take time and laser-sharp focus. Stick with it until you make the habits a second nature. Over time, you’ll be able to use the habits not just in trading binary options but for other financial markets and aspects of your life as well.