How often should you place trades?
The answer to this question is really determined by what kind of trader you are and your current investment budget. Some people are very picky about placing trades… and will only do so when conditions are ripe for their overall strategy.
I believe that following this kind of discipline helps new binary traders significantly in minimizing risks and the hazards of overtrading.
Pick a system you’ve either tested yourself or have purchased and believe in… and only place your binary options trade when your system tell you to do so.
This way you can quickly and easily determine whether the system you are using is good in picking winning trades or not. Just keep in mind that no system is 100% perfect and even the most advanced ones have a winning rate of around 75% (run if someone tells you otherwise).
Trading binary options is often an exhilarating activity that is filled with emotional swings. Being disciplined in your approach makes it a lot easier to handle these volatile times and is a great learning tool in how to handle pressure and adversity, not only in binary option trading, but in life in general.
The risks of being an overtrader
This is a very common pitfall that many inexperienced traders fall into when they start trading binary options. While the goal may be to exhibit patience and discipline when deciding to place a binary option trade, often times our emotions and ego get the best of us and makes us start placing trades based on a gut feeling alone.
Some binary options traders do really well following their gut instinct at first… but eventually things turn and they end up having to go back to a proven trading system.
We see these over-trading tendencies most often amongst hedgers. While careful consideration is taken before placing the initial trade early in the expiration cycle, all bets are off once the underlying asset has a chance to move around.
Always keep in mind that there are times hedgers find themselves locked into a two trade position that guarantees a loss, albeit a small one. Well no one likes to lose right? So what you’ll see is traders looking to turn a small loss into some sort of gain at the risk of losing even more.
This is bad form. A disciplined trader following a proven system knows there is no harm in taking small losses on positions. The goal is to live another day to place another trade and this can not occur if you continue to overtrade, placing risky trades to avoid small losses. If you ever find yourself in this position: Take the loss and move on to the next trade.
The secret to winning more trades & losing less
Obviously, the trick to earning big with binary options trading is winning more trades and losing less. And naturally that’s what you want to do… right?
Well, the easiest way to win more trades is, as I said before, having a proven trading system. If you’d like to know more about the system I use (that has turned me into a millionare trader), and get free access to it, then simply click here right now.