Obviously with a stop, that’s something you have to consider in both Spread betting as well as financial spread betting.  So with binaries you don’t have to get he timing quite so right.

So how do you trade Binaries? Well, FTSE finish up at a price of 20 for example so that the risk of this trade is 20 and the reward is 100. So you can work it out by the reward 100 – 20 = 80 and this gives you a risk reward ration of 1:4, which is 400% return, which is very, very good in trading. I mean in trading if you’re getting around 2.5 that’s good, but if you can get it up to 4 that really is good.

Now the implications for this are that if you are using a system of a say 50/50 hit rate, which is quite easy to discover or test out, if you got a risk reward of 1:4 and obviously your losses are always going to be on the one factor, but obviously your rewards are always back up to the four factor.

>>> Facts to Know About Spread Betting