Capital Drawdown Binary Strategy Tip

Best Binary Options Brokers 2020:

    Best Binary Options Broker 2020!
    Ideal for beginners!
    Free Demo Account + Free Trading Education!
    Get a Sign-up Bonus:


    2nd place in the ranking!

Capital Drawdown Binary Options Strategy

The capital drawdown binary options strategy was created as a tool for defeating the period of getting stable losses. Such a period is well known to the most of the binary options traders. Some experienced traders explain drawdowns of the account balance by the so-called downstreak. They see binary options trading as a cyclical process of consequent downstreaks and upstreaks, where the most important part is the trend, which has to be always positive.

The beginning traders should be aware of the capital drawdown strategy due to the fact that most of them are often influenced by the consistent negative results of the binary options trading.

The beginning of the binary options trading gives every trader some kind of euphoria that results in successful trades and an increase of the account balance. This way the traders feel that they are doing the right thing and, hence, keep on trading.

The drawdown periods are perceived by every trader in different way, some of us are good in dealing with it and the others are not so good. Continuous decrease of the account balance is dangerous due to the fact that 10% loss of the balance requires 11.1% increase in order to achieve the balance before the drawdown. The other required percentages for the capital increase are presented in the table:

Account loss Break Even
10% 11.10%
19% 23.40%
27% 37.10%
34% 52.40%

The capital drawdown strategy was created as the tool made for dealing with the downstreaks.

The problem is that in the time of the downstreaks, traders not just continue to trade using the same methods and strategies, but also increase the amounts involved in each trade. You have to understand that if you continue to trade in the same way as you did before and increase the trading volumes – there is nothing good waiting for you. You simply will lose more and faster.

The capital drawdown strategy highlights that binary options trading is not gambling, you cannot achieve positive results without using proper analytical and technical methods in the long run. While this is true, capital drawdown binary options strategy mainly focuses on the money management.

The first point of the capital drawdown strategy is the change of your existing trading strategy. You have to understand that usage of your existing strategy will only worsen your situation and no positive results will be achieved. This is why we suggest that you check out our strategies and find the new one that fits your needs.

Best Binary Options Brokers 2020:

    Best Binary Options Broker 2020!
    Ideal for beginners!
    Free Demo Account + Free Trading Education!
    Get a Sign-up Bonus:


    2nd place in the ranking!

The second point of the capital drawdown strategy is the decreased usage of your account balance in the trades. Any trade made by you should not be for more than 2% of your existing account balance. Even if you are 100% sure in the trade – it is recommended by the capital drawdown strategy not to use more than 2% of your capital. You better earn less than lose more, this is the philosophy of the binary options drawdown strategy.

Also, in the times of the downstreak you have to be prepared for the situations that can require additional deposits as a key for not getting margin calls and ability to trade on the normal amounts for no more than 2%.

The capital drawdown strategy is a key to success in the times of the decreased capital at your account. So do not be afraid if you got into the downstreak, just implement the strategy and remember that Binary Options Hub is always here to support you.

Binary Options Strategies

Below you can check the most profitable binary options strategies designed by Binary Options Hub just for you. If you are not yet ready, begin with our Binary Starter’s Guide. Trading binaries is rather easy, yet it requires a good binary options strategy. Binary Options Hub explains binary strategies in an easy and understandable manner, so it is not difficult to comprehend even for a beginner in binary options trading. Browse below to find the best binary options trading strategy! Trusted & Verified binary options trading strategy only.

Binary Ladder Trading Strategy

This advanced binary options trading strategy is perfect for traders experienced with pivot points. Many pros use this binary strategy daily.

Long-term Shot Trading Strategy

This strategy is designed for Touch / No Touch binary options. It provides high payouts and should be used for breakout binaries trading.

Capital Drawing Binary Strategy

This binary options trading strategy will help you to improve the binary options money management. Check this binary strategy now!

Binary Knock-on Options Strategy

One of the most advanced binary options strategies that do work. Be sure you are ready to take risks and profits offered by this strategy.

BreakOut Options Strategy

One of the basic binary options trading strategy. It has crucial importance. So be sure that you do read and understand it before trading!

Pivot Points Binary Strategy

Ready to implement some advanced math into Binary Trading? This strategy shows you how to use pivot points in Binary trading!

Diversified Option Strategy

Build a perfect winning grid using multiple types of binary options. See how Touch, boundary and regular options can bring profit.

Matryoshka Trading Strategy

Do not like to trade with a lot of different indicators? This strategy will allow you to do exactly that. Check out Matryoshka right now!

What is a Binary Options Trading Strategy?

As you may understand, binary options trading has evolved from a pure gambling activity to a systemised activity that can actually supply you with decent returns. Even though many traders still consider binaries as the instrument with significant risks and inadequate returns, this attitude is actually changing. When it comes to trading of any asset, the strategy plays an ultimate importance, this is why should dedicate substantial time in the development of your own trading strategy for binary options. In general, the strategy is here to provide you with a set of rules for entering the trade, supply your with the proper trading discipline and finally to assure that you have a higher win / loss ratio.

Should I Use a Pre-made Binary Options Strategy?

The short answer is YES. Binary Options Hub has composed a few common and proven trading strategies for you and by implementing them you can understand the market and the whole concept of binary options trading a little bit better. Also such binary strategies can actually help you in providing the fundamentals for developing your own personal trading strategy for binary options. It is recommended to try our strategies on the Demo account first, before you begin trading them on your Live binary options account. What is vital to understand is that such strategies are only useful for educational purposes. You may of course make money with these best binary options trading strategies, yet the strategy should always adopt the market behaviour and if you do not know how to modify your strategy according to the market changes, the strategy simply may stop working.

How to Develop My Own Best Binary Options Strategy?

There are a few things you need to look at when making your own strategy.

Best Instruments for Binaries

The first step is to identify the set of instruments you are going to trade. In general, there should not be too many instruments, nor there should be too few. Binary Options Hub would not recommend you to trade less than 4 instruments, as you simply may end up having low volatility and hence you are going to trade lacking proper knowledge, if you trade only one or two instruments. We would also advice against trading over 8 instruments, as it is quite hard to keep an eye on the technical and fundamental analyses for a larger count of the instruments.

Best Expiration Time of Options

Once you have determined the instruments you are mostly knowledgable about, it is vital to select your trading time frame. As you know, binaries can be traded online with the expiration time from 30 seconds to more than a year. Selecting your favourite expiration time is the most important part of the binary options strategy development. Usually Binary Options Hub would not recommend you to use anything smaller than 5 minutes and anything larger than a week, however, it should depend mostly on the analysis you are planning to perform and the strategy you are planning to use.

The Actual Binary Trading Strategy

Once you know the instruments and the time frame for your trading, it is now time to actually start developing the whole rationale behind your trades. You should generally focus on a few indicators that have prove working. The best way to do is to try our read-made binary options trading strategies and see which ones have been working for you. Then you do not need to copy the strategy but you rather need to extract the best parts of it. As for the indicators, they can work in your favour with the same chance of working against you, all depends on how you use it. Usually indicators are here to add a bit more clearance to your chart and explain your the past trend line moves, while forecasting the upcoming changes in the price of an asset. Once you have added a few indicators, you may actually see that you start understanding the moves on a chart little bit better. However, it is vital to note that adding too many indicators will remove any sign of a clearance from the chart. You will simply have too many indicators that contradict each other. This is why Binary Options Hub would not recommend you using more than 3 indicators in the same time, especially once you are just starting to develop your trading strategy for binary market.

Precautions Measures for Binary Trading

Overtrading of binary options is the most dangerous thing that can happen to a trader. It is important for successful binary options strategy to have a clear limit in terms of the trades you can achieve on daily and weekly basis. You should never trade just in order to compensate for your losses, you should only trade when you have a clear understanding of the potential results.

Long Shot Binary Options Strategy

This is a highly profitable binary options strategy, which is designed for long-term traders. Using long short binary options strategy you can get the average payouts of 250%. Although you cannot make trades with this binary options strategy every day, it is suitable for the traders that value time.

Are you able to make long run predictions? Can you correctly forecast recent events in the political and economic world? Do you stay up-to-date with the news? Then the long shot binary options strategy is designed for you!

Long Shot Binary Options Strategy Details

You have to understand that the long shot strategy involves higher risks than other binary options trading strategies. In contrast, the payouts in this binary options trading strategy are often higher than 250%. This means that even if you have a series of consecutive losses, just a few successful trades will give your account balance a boost that it needs.

The payouts in this strategy are closely related to the gap between existing price of the asset and the predicted price of the asset. The bigger the gap – the higher the payout.

The main task of the long shot strategy is to predict the significant increase or decrease of the asset. This is done to create a Touch/No touch order with a big gap, which will bring high level of the payout. You just have to decide the highest level that the price is able to achieve at least once.

This strategy can be implemented on any asset that you are able to trade, there are absolutely no limitations. The long shot binary options strategy has to be implemented in the times of the high volatility of the market.

So, you have to spot the situation in which some ground-breaking news are published or some important political or economic decisions are made. It is even better if these decisions differ from the expectations of the market players. In such situations market will not be able to quickly adjust expectations with the released news. Such situation can increase the volatility of the market dramatically. This is the perfect spot for the long shot binary options strategy! It is recommended to use technical analysis before implementing the strategy. It is done to evaluate the size of an upcoming price gap and get the maximum possible payout.

Long Shot Binary Options Strategy Example

  1. The news about Swiss government will be released in 30 minutes.
  2. Using the technical analysis at both, basic and advanced levels helps you predict the possible cases of abandoning the peg of Swiss Franc to Euro. The price of the Franc will increase significantly, approximately by 30%.
  3. You open your binary options trading platform, then go to the Touch/No touch trading and find the EUR/CHF instrument. The current price is 1.000.
  4. The news are released and Swiss government decides to abandon the peg to Euro.
  5. You implement the long shot strategy getting Touch order for the price on 1.250. Which will give you 350% payout.
  6. The difference between expectations and the news creates high volatility and the price achieves the level of 1.251.
  7. You get your profits and stay excited that you have used the long shot strategy.

fa-icon You have to understand that implementation of this strategy is difficult and has to be taken with the high level of caution. Also, it is not recommended to involve more than 2% of your bankroll in one trade using long shot strategy. Long Shot binary strategy requires some strong knowledge of fundamental events, check forex factory calendar to know when such events happen.

Advantages of Long Short Binary Options Strategy

Using this strategy should be beneficial in comparison with other strategies. What are the benefits of this binary options strategy? The main idea is that you get a higher pay out using Touch / No Touch option. If you, for example, used a regular option instead of Touch / No Touch, you would end up having a return of 80-90%, which is about 4 times lower. As you are able to achieve high profits with this binary strategy, you only need to have 1 correct prediction per 2 incorrect. This way you can still be profitable in binary options trading.

Best Binary Options Brokers 2020:

    Best Binary Options Broker 2020!
    Ideal for beginners!
    Free Demo Account + Free Trading Education!
    Get a Sign-up Bonus:


    2nd place in the ranking!

Like this post? Please share to your friends:
All About Binary Options Trading
Leave a Reply

;-) :| :x :twisted: :smile: :shock: :sad: :roll: :razz: :oops: :o :mrgreen: :lol: :idea: :grin: :evil: :cry: :cool: :arrow: :???: :?: :!: