Now a days online trading is very popular. If we talk about trading, this is not a new word. We are doing this from long back. Earlier it was in the form of exchanging goods with goods then it has changed from exchanging goods to currency and now this is also buying, selling or exchanging the stocks or bonds. There are many ways to trade. Even buyers are different as some of them are buying the stocks and commodities for long term and some for short term profit.
There are so many trading companies which are connecting buyers and sellers for trading. The regular way to trade is for Profit and loss at a specific point. So, you fix the buying or selling price and then the transaction is triggered once the price reaches that point. Now days, a new form of trading is emerging which is called as Ladder Binary Trading.
What is ladder binary trading?
Here we are already aware with the term trading. If we talk about ladder here the meaning of this is steps decided by the trader which will be climbed to gain the profit and these steps are price levels which will be preset. The payouts are determined based on the price level reached at a particular point of time.
In ladder binary trading the timeframe or interval should be same between the price levels. A trader needs to set 3 strike prices in three time intervals. In this type of trading payout will be already decided for each level and that will be earned by the investor if they reach that level at a specified time.
So on all the three levels if an investor’s strike price is accurate he will earn payout. There will be always a possibility that investors will earn all or nothing at all. The setup of price levels will be like this: first level will be lowest, second will be 15% higher and third will be 15% higher than second. In this method an investor has to do always planning and research too.
Let us try to understand this as an example:
Let’s imagine that you want to trade for X commodity. The current price of X is $100. The strike price you decided to sell this is $110 for the day. Now, one can determine the steps to reach to this strike price. So, 1st step could be $102 at 11:00 AM. 2nd Step is $ 105 at 1:00 PM. 3rd Step is $110 at 3:00 PM.
Now, the broker provides Y % of total investment if the commodity is trading at the same or higher price level decided at a particular time.
So, the trader might get 40% if the X commodity is trading at $102 or higher at 11:00 AM. Similarly, he will get 50% if it is trading at $105 at 1:00 PM and 60% if it reaches $110 at 3:00 PM. So, the total benefit is 150%. So, the trader made 50% profit over his investment.
Benefits of ladder binary trading:
As the time is changing the way of doing things are changing too. In the market there are many different ways of trading earlier but still some brokers only gave the option of traditional trading like high /low trading. But now as the technology is growing people are getting the knowledge so are brokers too. Ladder binary trading is becoming popular now and brokers are offering this method too.
In this method if you are keeping the intervals very short and price close, you will get smaller payout but if you increase both of them you will get good payout. This method allows you to have an option to frame your trading. If you have done good research and you know that a particular stock will go up or down you can get good profit. Not many brokers offer Ladder Trading for now but if you are interested CherryTrade offers it.
Right time to use ladder binary trading:
If we talk about ladder binary trading, it is not recommended for beginners. This type of trading needs experience, research and more knowledge. So this is best trading option for experienced traders. If the strike price is set accurately this is very much profitable but this needs good analysis and it will be difficult for new trader.