In order to make the most of a binary option, you should set a strategy, and for choosing an options strategy, understanding of your needs is crucial. If you want to achieve your investment goal, you need to choose the right strategy that performs effectively. Fortunately, these options come with the flexibility. They are able to enhance the abilities of portfolios in various ways. In order to fully take advantage of them, it is important to take time and fully understand a goal that fits you and help you meet the goal.
Knowing what your goal is narrows down the range of strategies to go with. When it comes to investment, not every strategy is going to be appropriate for your goal. Let us guide you through the strategy called bullish strategy, and the bearish strategy, they both are the simplest forms of strategy.
If after studying the market with either fundamental or technical analysis, you reach a conclusion that the asset of your case has a potential of heading upwards, a BULLISH strategy may be the one to employ. Since you have an ABOVE/BELOW option type at your disposal, you can choose a CALL option or an ABOVE option according to your calculation and prediction.
Let us give you an example : After analyzing the technical charts of OIL, you predict that a breakout is approaching. You see that the price of oil is marking $105 at the moment and predict the market is going to head upwards in few hours.
After witnessing that the payout on OIL options are reaching 80% at your broker, you may want to use a bullish strategy by selecting a $1000 CALL contract (or above option) with a 30 minute expiry. If your prediction is right, and the price of OIL goes up in half an hour, you will be smiling with a profit of $800 ($800 profit = 80% of the initial investment of $1000).