Binary options are simple trading options which offer higher returns in a short duration of time. They can be implemented using various trading strategies like covered call and protective put, to hedge the share or stock from unexpected risks. They are easy to implement and helps the trader in gaining the maximum out of his investment.
One of the most popular modern strategies for trading binary options is the stop-loss strategy – it’s really taken off in last 18 months throughout New York, London and Tokyo and is predicted to skyrocket globally throughout 2012.
The stop-loss strategy is employed by traders when their underlying securities fall to a certain value and may lead to losses. This will allow the trader to recover the maximum amount out of the trade by selling it before it is lost, making this an extremely useful binary options strategy.
Some of the traditional binary options strategies that traders can employ include choosing the correct broker, investing in short-term contracts and staying informed about the latest financial news that can potentially impact on the direction of one’s underlying asset price.