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  1. #1
    Administrator Martin Kay's Avatar

    Hot Option Builder Tool for Binary Options Trading !!!

    Hi, guys! A great article by Michael explains the popular Options Builder Tool. Check it out and see how it could be used in your daily trading activity!

    Originally posted by Michael Hodges. For the full review click here.

    The recently released new Option Builder tool is advertised as a method for expert and novice traders to customize their trades according to their own trading styles. The tool, which is very versatile, allows traders to pick more than just call/put and hourly, daily or weekly expiration. The tool allows traders to define their own trading parameters so that the options fit their trading style. You may have heard of this under different broker, thatís because it is powered by the SpotOption trading platform which provides execution and market making for nearly 80% of current binary options brokers.


    Why the Option Builder Tool Doesnít Suck

    There is one real advantage I see in the Option Builder Tool. It allows short term traders to trade overnight. For the most part short term binary option expirations are limited to the day of the trade. They will expire sometime that day up to end of the day. Not many brokers, none that I know of at this time, allow for overnight or day to day expiration. With the Options Builder Tool a trader can enter a trade and then set the expiration for sometime during the next day, provided the market is open on the day. This tool will not work for trades over the weekend.


    Why the Option Builder Tool Sucks

    I started out with this assignment thinking that this tool would be really cool. The idea that I could set up my own binary options was awesome! I often want to trade options for longer or shorter than the preset choices on my platform and was looking forward to the chance of defining my own trades. In reality the tool is extremely limited and everything I read leading me up to the tool itself was misleading. Maybe Iím gullible, I donít know, but what I read lead me to believe there was a large amount of flexibility in the tool. What I found was that it is very limited and not even suited to my style of trading. I like to trade on a weekly and monthly basis, capturing movements on the daily charts with entries on the hourly charts. This tool, like many other binary options brokers and platforms, is totally geared toward day traders and only allows expirations up to 24 hours out.

  2. #2
    Specialist Member marvel's Avatar
    Interesting, but really controversial tool and a great article about it! There is some confusion about the real usability of the Option Builder Tool. It is helpful but it did not reduce overall risk, just changing the odds for a particular bet. If you want to trade a particular trade but are not so sure could increase the insurance level, if you have bigger confidence you could decrease it but in the long run it will depend only of your trading abilities not of the Option Builder Tool itself what will be your performance..

  3. #3
    Senior Member Grae's Avatar
    Instead of picking from a list of hourly, daily or weekly expiration you get to pick the exact hour and minute of expiration, up to 24 hours from purchase."
    ---
    That could have been a great plus today when EUR tanked after Draghi..

  4. #4
    Specialist Member LesterK's Avatar
    Quote Originally Posted by Grae View Post
    "Instead of picking from a list of hourly, daily or weekly expiration you get to pick the exact hour and minute of expiration, up to 24 hours from purchase."
    ---
    That could have been a great plus today when EUR tanked after Draghi...
    For sure Grae, Option Builder is one of the most helpful tools in the binaries world. I prefer it as you said because you could easily create your customized option, which could be placed on the exact moment of time, when you think the price action is best fitted for your position.

  5. #5
    Legendry Member Michael Hodges's Avatar
    Quote Originally Posted by marvel View Post
    Interesting, but really controversial tool and a great article about it! There is some confusion about the real usability of the Option Builder Tool. It is helpful but it did not reduce overall risk, just changing the odds for a particular bet. If you want to trade a particular trade but are not so sure could increase the insurance level, if you have bigger confidence you could decrease it but in the long run it will depend only of your trading abilities not of the Option Builder Tool itself what will be your performance..
    I feel the same way. The tool has a lot of potential but does present any real advantages to traders at this time. If you want less risk use less money. The only thing I really liked was the expiration choices but in the end it is still too short for my type of trading.

  6. #6
    Legendry Member Michael Hodges's Avatar
    Quote Originally Posted by Grae View Post
    "Instead of picking from a list of hourly, daily or weekly expiration you get to pick the exact hour and minute of expiration, up to 24 hours from purchase."
    ---
    That could have been a great plus today when EUR tanked after Draghi...
    Yeah, you still would have had to anticipate the drop first and then could have played a daily or hourly call just before the announcement. The pair is still down and now has to break back through 1.3500 in order to be bullish. I think Eur/USD is now range bound until a change in fundamentals.

  7. #7
    Legendry Member Michael Hodges's Avatar
    Quote Originally Posted by LesterK View Post
    For sure Grae, Option Builder is one of the most helpful tools in the binaries world. I prefer it as you said because you could easily create your customized option, which could be placed on the exact moment of time, when you think the price action is best fitted for your position.
    yeah, but you still have to anticipate the move before hand.... I agree that builder could be a useful tool but at this time i just see it as a way to lure in new traders. I welcome your thoughts on this .....

  8. #8
    Veteran Member Ammeo's Avatar
    Quote Originally Posted by LesterK View Post
    For sure Grae, Option Builder is one of the most helpful tools in the binaries world. I prefer it as you said because you could easily create your customized option, which could be placed on the exact moment of time, when you think the price action is best fitted for your position.
    Ahh my favourite tool...i mostly try to do custom options..
    Last edited by Ammeo; 02-10-2013 at 03:11 PM.

  9. #9
    Legendry Member Michael Hodges's Avatar
    I did some math using the available risk/rewards versus the rewards available with standard options. This is what I found. Using a 55%/30% profile a trade of $100 returns $55 and risks $70. The average return on the same platform was around 75% so to achieve the same return ($55) you have to risk $73.33. This comparison makes the option builder better. However, if you move up to the 74%/0% profile $100 returns $74 and risks $100. In order to achieve a return of $74 with a 75% return on investment you have to trade $98.66. So, based on this it is better to use the option builder with a lower risk/reward profile but if you are trully bullish on a trade it is better to use a standard option. If you lower the return of a standard binary to 70% it requires a risk of $78 vs $70 to return $55, much more expensive, and to return $74 it requires a risk of $105.7, also more expensive. So, if your standard binaries are returning less than 75% the builder will lower your risk but if the binaries are returning 75% or more they are better.

    Anyoption has always offered a choice between risk/reward profiles and has a better rate. The top end is 80%/5% and the bottom end is 60/25. From what I have seen the OptionBuilder offers 74/0 for the high end and 55/30 for the low end.

  10. #10
    M.J
    M.J is offline
    Veteran Member M.J's Avatar
    Looks to be a better option for traders who come from forex background and want to set entry and expiry time depending on their analysis.

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