Obervations from my first 3 weeks since discovering Binary Options.
It is a little over 2 weeks since I stumbled across BOTS, whilst searching for reviews on "tradeperday" provided by "Intellitraders". Since then my mouse has been working overtime, clicking on numerous websites and reading countless articles and blogs, mostly on BOTS. My knowledge has already improved ten fold but clearly I am in no position to start trading yet. I have spent some time checking signal providers and their results on signal index and signal push, I question whether some traders perhaps over emphasise the importance of charts at the expence of the prevailing economic conditions.
I have been monitoring my "good friends" from intellitraders, who in their advertisements on facebook, guarantee 120% return on 10 trades. Needless to say, of the 16 trades I have been sent to my email address, 4 have ended in the money and last week none at all ended in the money. Whats going on there?
I also took SignalCoyotes free 5 day offer and as a newbie I was quite impressed. Of the 36 trades provided, 23 ended in the money. I enjoyed following his service and I am in two minds to pay for his auto trader service. Where I sit uncomfortably, is to use auto trader you have to open an account with GOptions. During one the trading sessions on skype one or two of the members were expressing concerns about the practises of this particular broker. Do any of the BOTS members have experience of GOptions.
It is clear that you need considerably experience to be a successful BO trader and whilst I was impressed by SignalCoyotes 64% success rate, I cannot help but think a professional trader should be closer to 75-80%. Looking at the results of other signal providers registered in signal index and signal push, the success rates vary from 49-70% with most in the 50-60% range. What level of success should a professional trader be expected to achieve?
Finally, regarding BOTS itself. I thoroughly enjoy reading the various postings and like the friendly community spirit. Long may it continue.
Success rate is dependent on a number of things. Trade success rate is not enough to show trader's success story. A trader earning 80% and having 40% drawdown will not be considered good against a trader earning 70% and having 10% drawdown. There r many similar examples that can be given to understand that profitability doesnt mean "revenue" only. You have to consider costs which u r paying in order to get that revenue or risk which u r taking in order to get that revenue.
I have seen successful traders with as low as less than 40% success rates but still earning very nice profit percentage. Why? Because they adopt excellent money and risk management strategies. They adjust their trade size depending on probability of success, which is another concept.
The Daxter meaning of success rate as I understand is the percentage profitable options. M.J you describe some more complicated situations with variable options size or in forex markets when you could apply SL/TP but the question of Daxter was only to know which the appropriate success percentage is in order to be sure the strategy is profitable. 55% is the absolute minimum, 60% and above is better. For sure nobody could achieve 100% in the long term but let say 80% could be achieved with very strict and advanced strategy. So this is the success rate we need to achieve something between 60 and 80%. The variable position size could also give some advantages. Never fell in trap of martingale trading usage it is never profitable! I could say antimartingale is much better i.e. decreasing the position size after loser and increasing after profitable trade. The best variation is upon your gut feeling and analyzes but it could be learned only after many months of trading, so at the beginning it is the best to start with fixed position sizes I think!
Thank you guys for the valuable discussion here! As far as I understand everything well there is great need for improved odds or wining percentage to achieve profitable results. If I have 60% wining rate i.e. 6 out of 10 binary options are ending in the money than I will have profit bigger than my trading cost. Actually the trading cost in binary trading looks greater than in forex trading, but there are other big advantages like smaller position size and controllable risks per trade and possibility for better outcome from smaller movements, which actually compensate all the costs it has. I prefer to trade binaries also because they are more effective in controlling your exposure and more flexible too.