Binary Options vs Forex – Which is best?

Introduction

The binary option or forex is different from each other. The binary trading in which the investor has more in comparison to forex because in which the profit is high and the risk is less. Forex exchange is one of the largest financial markets in the world in terms of volume or anything. For the new comers in trading take the time to understand the market than take the decision according to your skills.

Binary option- Binary option involves the currency, commodity, stocks for a specific period ( usually for a minute or few hours ). The Binary option required only yes or no propositions. In binary trading, the expiry date, profit and loss of their investment are in front of you. The user of binary options has to operate within the marketing hours.

Forex- Forex trading is also known as Forex exchange or FX trading. In simple words, the exchange of one currency against another currency. The forex exchange is for a variety of reasons like tourism, commerce and trading. The currency price is increasing in the trading market known as going long and the price of currency decreasing in the trading market known as short.

Positive and negative view on Binary option and Forex

1. Profitability

Binary option- The leverage investment is not possible and in terms of risk, it is less. Binary options are generally not as profitable.

Forex trading- The market condition in currency trading the leverage in forex is higher up to 500 times. That means borrowing the money for capital beyond the initial investment helps to increase the position.

2. Control

Binary option- The binary option there are some control options, profit and losses are pre determined the traders choose the expiry dates.

Forex trading - Entry in forex trading is easy but the least to exit because it can be attractive to trade in currency. In forex trading, there may be a high margin if trades are not monitored properly.

3. Risk

Binary option- In binary option is less risk in the condition of profits and loss in front of you. This means the market is less affected by market volatility.

Forex trading- The market fluctuates on different factors of supply and demand on global events. The forex trading market is unpredictable and highly volatile in nature.

4. Fees

Binary option- Cost is dependent on the final payout while the binary option. Some brokers charge lower fees but the trader has to clarify how much amount is required before entering a trade.

Forex trading- The forex trading fees usually come from the spread and the commission set by the online brokerage company.

5. Access

Binary option-.The binary option trades with underlying assets (trading hours), the users have to operate the respective market within a day.

Forex trading- The currency market is accessed 24 hours a day and 5 days a week. It is the global market but it is across several major financial centers in different zones such as banks, institutions and individuals who can trade anytime 24 hours.

6. Diversity

Binary option- It offers a wide range of markets, including stocks, commodities, and currencies, it means that you have a proper variety of choice to invest the money.

Forex trading- Where the forex trading only takes place in the four pairs of currency and there are much more available.

7. Margins

Binary option- Five types of binary options you can trade high/low, option builder, boundary option, 60 second options, touch/ untouched options.

Forex trading- Forex trading has a tool called margins. Every broker determines the maximum margins. Margins are allowed to trade investments so that they can make a larger profit if the trade is winning.

8. Price movements

Binary options- The binary options have a price certainty, in binary options the amount of profit that you are set to get in the place of your trade will not change regardless of how the market performs. For example: if you placed a trade of $100 with a payout of 50%then you will get a 60% on how the asset will perform in the market.

Forex trading- This market changes very rapidly and fluctuates second by second, if the market is not in your favor, then your profit margin will reduce. The forex trader usually does not worry about the market moving in which direction but worries about if the market goes for or against them.

Which one is best?

Forex trading and binary options both are quite different and it is important to understand the differences to become a successful trader. Which is better depends on you but forex trading is more volatile in nature, needs the time for research and collecting all the information regarding, monitoring the trade and allowing leveraged trading. Binary options allow you to see where the cost and risk are clear, it depends on you whether you invest or not. Consider whether you are looking for a financial product and the markets want exposure to. The traders who are actively working with forex on a day to day basis and looking for leverage, then forex may be suitable for yours. But on the other side, the binary options are easy and facilitate exposure to multiple markets.

Conclusion

When we talk about the binary option or forex, it is clear that the binary option is easy to hand and flexible to trade. Both the things have all the negative and positive attributes. The binary option is highly profitable and less risky as compared to the forex. When you decide to trade before you enter, gain the knowledge about the market and what type of trading suits you while trading.