Читать книгу Binary Trading - John Piper - Страница 10

For those of you unfamiliar with the delights of binary trading I ought to make a number of important points.

Unlike with spread betting I am not worried if I do not catch the high – I cannot get stopped out of most binary bets, even if I wanted to. The fact a market may go 30 or 40 points against me is not of major concern as long as it goes the right way eventually.

If I buy a bet at 40 my maximum profit is 60 (100 – 40) as a binary bet can only move between zero and 100. That is a reward of only 1.5 times my risk (60 divided by 40 = 1.5 = 150%). But consider this ratio on my other two bets. Buying at 11.4 gives me a potential reward of 88.6 (100 – 11.4) and a ratio of almost 8:1. Buying at 8.9 is even better giving a potential reward of 91.1 (100 – 8.9) and a ratio in excess of 10:1.

Consider this in the context of risking a total of £100 on each bet:

 Buying at 11.4 allows £9 per point (11.4 x £9 = £102.60). My maximum potential reward is then £797.40 (88.6 x £9= £797.40). In percentage terms that is a return of 777%!

 Buying at 8.9 allows £11 per point (8.9 x £11 = £97.90). My maximum potential reward is then £1002.10 (91.1 x £11= £1002.10). In percentage terms that is a return of 1023%!

You will notice that risk/reward is significantly better if we risk less in the first place and the lesson is that it pays to get in cheap (or sell high when we sell to open).