Wednesday, 29 April 2015

Money down the drain - Binary Options

After a fair amount of research, I have concluded that binary options are an exciting and dangerously addictive method to waste money.  It's possible to get the same outcome by flushing your pounds and dollars down the toilet.

It might be that you can "get good" at predicting the direction of the share price but in the long run the "house always wins" This is especially true if you make mistakes such as entering the wrong figure, accidentally click the wrong button ( up instead of down) or the web system becomes strangely faulty and unresponsive just after placing the prediction. 

Yes its a lot of fun and is actually very addictive as it triggers that bit the brain associated with pleasure each time you win.  It's a form of gambling on the stock market and you don't actually own any shares during the process.

Sometimes its possible to get a winning streak and everything is happy, wonderful and rosey but it doesn't take long for the situation to reverse and all of a sudden those winnings disappear along with even more of the money from your pot.  It's also very easy to keep throwing good money after bad to try and regain the previous losses especially if you get into the mindset of thinking that the following will happen:

Just one more go and maybe I'll make some money. However, in reality its more likely that this happens:

Some options occur over a very short amount of time, maybe just a minute or two.  These are even more exciting than the more normal 15 minute options and provide that instant gratification.  The downside however is that its even quicker to lose money.  One bad prediction can lead to the thought of "maybe this time" and that next one goes wrong as well followed by the next and next.  These options tend to occur on a very small range of the overall share price.  It means that an otherwise small share movement can have a huge effect.  The problem is that a price can look as if it is heading in a certain direction but all of a sudden it swings to the exact opposite and money is lost.

These findings are of course based on my own experiences - I'm not a financial expert - and as such, if asked I wouldn't recommend Binary options as a serious way to make money as winnings disappear as quickly as they come.