Binary Options

Twitter Binary Options

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Twitter Binary Options

Limits inspire creativity. No modern company has embodied this concept as well as social networking giant Twitter. It brought micro-blogging to the masses and changed the speed at which information spread throughout the world. Anybody could write their 140-character thoughts and publish within seconds. Twitter become home to the mundane and the profound. It made entertainment headlines and influenced revolutions. The company has also proven to be a profitable venture with hundreds of millions in revenue. When it launched its IPO, it attracted massive interest which continues to this day. Make your Twitter binary options trading thrive by learning more about the company.

A Brief History

Twitter was founded in the first quarter of 2006 by friends Noah Glass, Biz Stone, Evan Williams and Jack Dorsey. It launched in the third quarter of the same year and quickly attracted a large following that has snowballed into 271 million active users as of mid-2014. Together they generate nearly a billion tweets per day on every conceivable topic. The company now employs over 3,000 software engineers, graphic designers, marketing specialists and more. Businesses use the social networking service to reach their customers and receive instant feedback. Governments and organizations use it to disseminate important information.

The Twitter IPO

The success of the platform has encouraged the top executives to get Twitter listed on the stock market. They filled the papers to the SEC in September 2013 and had their first trading day on November 7. There was overwhelming clamor for the 70 million shares which were priced at $26 at the opening. They closed at $44.90 per share which meant that Twitter had a value of roughly $31 billion. The price has fluctuated much over the year going as high as $74.73 and as low as $29.51. Market capitalization stands at around US$30 billion.

Revenue Sources

Most of Twitter’s revenues come from advertising. Since 2010, the site has allowed companies to purchase ad space in the form of promoted tweets and promoted accounts. Those familiar with Google AdWords will note similarities between the two services. Both display relevant ads based on search results and other parameters. This was first provided to invited clients only but Twitter has since opened up the self-service advertising platform to the public. The feedback has largely been positive and revenues have continued to grow steadily, although it is still operating at a loss.

Trading Twitter binary options is an exciting endeavor as the company is right at the heart of popular culture. It is on the news headlines nearly every day thanks to celebrities and other controversial users. Outages and security concerns can send stocks tumbling due to eroded confidence. On the other hand, innovations, acquisitions and partnerships can help the price rise again. A thorough study of the history of this young tech company should prove quite rewarding for the earnest trader.

Investing

Oil Commodity Binary Option

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Oil Commodity Binary Option

Oil powers engines across the globe. It is a vital commodity that affects nearly all others making it one to watch out for. Investors who are interested in oil commodity binary option trading should pay particular attention to the factors that affect its price movements. The three primary considerations include the oil supply, the global demand, and the existing reserves. Each of these is in turn affected by a number of complex issues ranging from weather systems to geo-politics.

Oil Supply

As economic theory goes, the supply of any commodity determines its price. Scare products carry a higher premium than those that are readily available. If there is abundant supply of oil, then the price per barrel tends to be relatively low. If there is a limited amount, then people will bid higher to get their share. The Organization of Petroleum Exporting Countries regulates the quantity of oil production among its members. The block is large enough to profoundly influence the world market. Yet external factors can affect their ability to reach the set quotas such as natural disasters and damage due to warfare.

Oil Demand

On the flipside of things is the demand for oil which has just as much impact on prices. Over the past decades, the trend has generally been in the direction of increasing thirst for oil to power industries and transportation. This has led to a steady increase in prices from $20 per barrel to over $100 per barrel. There are, however, significant periods of decline due to weakness in the global economy. Slowdowns in the United States are especially crucial as the country is the biggest consumer of oil by far with billions of barrels consumed on an annual basis.

Oil Reserves

Each country has its own oil reserves that act as buffer in case there is a problem with oil production or its delivery. Some naturally have more to offer like Saudi Arabia. If the Saudis open their reserves, they can alleviate shortages and prevent spikes in oil prices. The US also has a massive amount always on the ready in its strategic petroleum reserves. The government can step in and tap into these to stabilize the economy when needed. An example would be delayed shipments due to issues with the regular routes or the cargo vessels themselves.

Investors interested in oil commodity binary option trading must always have their eye on the news. It is perhaps the most politically sensitive commodity with the bulk of supplies originating from the Middle East, a region where conflicts have been raging on and off for many years. Tensions can send prices soaring even though the supply chain has not yet been affected. This would naturally correct itself after a while when nerves have calmed down. A deep understanding of the history of oil and the interactions between the biggest players is essential for success.

Binary Options Trading Strategies

Flow Charts – Put Spreads

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Flow Charts – Put Spreads

Flow charts – put spreads are used as a hedging strategy. Many people invest in put spreads to offset possible losses in other investments. Investors that own stock in a certain company and want to hedge against losses in case the prices of those stocks go down, buy put options on the same stocks. Put options give traders the right but not obligation to sell stock at certain times in the future at a certain price known as the strike price. This means that put options are financial derivatives i.e. their values are derived from those of other assets. In the case of stock options, the underlying asset is the stock itself. Certain tips should be followed when trading put options.

Set up a brokerage account that allows you to trade stock options. There are two main options for setting up a brokerage account: with traditional brokers or online brokers. Compare account requirements including service fees, fees for making trades as well as other charges.

Generally, you will pay less with online brokers than with traditional brokers. However, traditional brokers offer the full range of investment advice and attention.

Learn how to trade put options and how they work. A put option is a contract to sell 100 shares of a particular stock. Investors are required to pay a certain fee to purchase put option premiums.

For example, if you purchase one put option with a strike price of $100 a share and the underlying stock goes down to $85 a share, you can still sell 100 shares of that stock at $100 each, which translates to a profit of $15 a share. If the stock goes up to $110 per share, you would still sell your shares for $100 per share, so you would lose $10 a share. In that case, the put option has no value. Because there is no obligation to sell, the only thing traders lose is the premium they paid to purchase the put option contract.

Consider hedging against losses on stock you already own. For example, let us say you purchase 100 shares of a given company and that company appreciates considerably, but you think the company can still keep growing, so you do not want to sell. However, you are also afraid that the company’s stock may go down.

The best thing to do is to buy put options to limit your losses. Using the same example, if the company is selling for $125 a share, you could purchase put with a strike price of $120 a share. That way, you will only lose the premium you paid for the put option in case the company’s shares continue to go up. On the other hand, if the company’s stock goes down, you can still sell 100 shares for $120 a share. This limits your losses to the underlying stock to $5 a share.

Pay careful attention on flow charts – put spreads, stock prices and expiration dates. Typically, put options expire within a month to two years after the date of purchase. Once the put options expire, they become worthless.

Binary Options Trading Strategies

Risk Management – O.P.A.L

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Risk Management – O.P.A.L

The lure of potential profits brings new traders to the markets every day. It is very easy for new investors to get started, particularly when they are feeling motivated by the potential for significant revenue from trading. What they sometimes fail to understand at first, however, is that all traders also need to have a strategy for risk management. For some, the Risk Management – O.P.A.L strategy is ideal. The acronym O.P.A.L stands for order management, position management, account management, and leverage management.

Order Management

The first place to begin looking at risk management is with orders. A stop loss order is an order to either buy or sell an asset when it reaches the stop price that is specified. A limit order is one to buy or sell an asset that is at a specified price or better. A sell limit order would occur at the specified price or higher, while the buy would occur at the specified price or lower. A contingent order is one that is executed under specific conditions that constitute the desired contingency. Management of all types of orders helps investors to make the best order decisions.

Position Management

Managing positions involves timing with regard to trade decisions. Timing is critical for maximizing profit while minimizing loss. More than a plan, effective position management helps investors to execute trading plans with optimal timing with regard to trends. Position analysis enables traders to gain the most helpful insights and make the best investment decisions.

Account Management

When applying an account management strategy, a trader assesses the size of the account and realistically determines the amounts that are acceptable to risk. Traders must determine the amount of loss per trading position that is acceptable, and they must also calculate those amounts in terms of total potential loss with all positions. Effective account management helps traders to minimize risks while still pursuing profits.

Leverage Management

Proper management of leverage further helps traders to minimize losses while maximizing profits. One thing traders must do is remain aware of the margins on each position. Above all, traders want to avoid a margin call. Investors need to remain cognizant of the risks inherent with trading with a highly leveraged account. The potential for profit is enticing, but traders must be prepared to bear the risk.

Without proper risk management, traders can soon discover their losses overtaking and diminishing their profits. The excitement of profit potential can get the most of traders who neglect the implementation of a strategy to minimize risk. The O.P.A.L components all together form a comprehensive strategy for risk management.

Order management contributes by setting specific conditions under which orders to buy or sell will occur. Position management aids in optimal timing that can protect profits and prevent losses. Account management enables traders to manage loss in terms of dollar amounts they are willing to risk overall. Leverage management helps to prevent the sinking feeling of a margin call. The Risk Management – O.P.A.L strategy on the whole provides a thorough means of protecting investors while allowing them to pursue opportunities for profit.

Binary Options Trading Strategies

Decision Point Price Momentum Oscillator

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Decision Point Price Momentum Oscillator

Are you thinking of using the decision point price momentum oscillator to see if you can spot changes in the market in one direction or the other? Perhaps you’re interested in trading based on indices – something that you can do in binary options trading, for example – and you need to know how they are going to move and how strongly they’re going to do so. After all, you make money by predicting those moves just before they happen so that you can get into or out of the market at the right times.

This is exactly where the PMO can help you. It is a tool that looks at the overall rate of change for set periods of time; these could be as short as a few hours or as long as five years or more. Not only does it look at the raw data, though, but other functions are used along with smoothing techniques to give you a more accurate interpretation of what the market is really doing. When you chart it out, you can put the lines for the raw data and the data that has been smoothed on the same graph, for the sake of comparison.

Among other things, this information can help you to identify times when the indices have been oversold or overbought. It gives you a range – one common example is -2.5 to +2.5 – and shows the movement within that range. If you see the numbers approaching those limits, you can be confident that an overbuying or overselling situation has occurred, and this often means that you are going to see a reversal in the numbers. This tells you that the market is primed for your own involvement.

Of course, the data can also show you the general, overall trends. You may see that the numbers have been trending consistently upward on a five-year chart, though you can also see the spikes and valleys along the way. While these look small on such an extensive chart, you have to keep in mind that they could go on for weeks or even months in real time. You have to be able to react even to these small changes. There is money to be made in binary options even if the numbers are dropping, for example, despite the fact that the overall trend for the year may be a rise. You have to know how to use both short-term and long-term trends to your advantage.

Much of what the market does is just based on what other traders are doing. As they buy and sell, they can push it toward reversals. The decision point price momentum oscillator, known as the PMO, can tell you exactly when that is happening so that you can react appropriately. It may not be the only tool you use, but should be used often.

Binary Options Trading Strategies

Understanding and Calculating Net Operating Income

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Understanding and Calculating Net Operating Income

Your “Net Operating Income” or “NOI” is essentially the amount of money you have left after subtracting all justifiable operating expenses from the total revenue generated from (or by) a property. This total revenue generated is called your “Gross Operating Income” or “GOI”. In short, in a case where Property Y has a GOI of $50,000 and justifiable or “reasonably necessary” expenses of $40,000, the NOI for Property Y would be $50,000 – $40,000 = $10,000.

Things to Note

  • The GOI is calculated by subtracting vacancy and credit losses from the property’s gross potential income (i.e. how much it could make in the absence of its losses).
  • Where the NOI is negative, the term “Net Operating Loss” or “NOL” is used.
  • The sums that lead to the calculation of the NOI are captured on the property’s income statement as well as the cash flow statement.

The Difference between Cash Flow and NOI

A property’s cash flow is the amount the property generates and uses in a given period. While they may sound similar at first, the fundamental difference between the property’s cash flow and net operating income are the expenses that you must include in the cash flow but exclude from NOI figure. Loan payments are an example of this.

Calculating a Property’s NOI

The best part about calculating a property’s NOI is the ease with which it can be done. All you need is a calculator, a detailed list of the property’s income as well as its operating costs, and a clear understanding of what to include and exclude in order to arrive at an accurate the NOI.

To accurately calculate a property’s net operating income you must:

  1. Record all sources of income for the property i.e.:

– Rent or lease
– Parking space or other facilities rental
– Upkeep and other service fees charged to tenants
– Vending and/or laundry machines as well as any such related services
– Any other means of income generation on the property

  1. Document all expenses related to:

– Vacant spaces/rooms/lots etc.
– Utilities and maintenance (such as janitorial fees and repairs)
– Office personnel
– Property taxes and insurance

  1. Avoid taking the following into account:

– Loan payments (both principal and interest)
– Depreciation
– Amortization
– Capital expenditures
– Taxes apart from those that are property related (since NOI is, in fact, a pre-tax figure).

Mistakes to Avoid

While net operating income calculations allow the flexibility of upward or downward adjustments of income and justifiable expenses, it is important to avoid overstating generated income or understating operating expenses. Doing either could easily prevent you from getting an accurate view of the property’s true profitability. This is especially critical to remember when attempting to show a possible buyer or investor what he or she can expect to make from the property.

Investing

Global View: Investing in Emerging Markets

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Global View: Investing in Emerging Markets

Investors are increasingly turning their attention to emerging markets. In fact, Morgan Stanley has an Emerging Markets index that consists of countries such as Brazil, Argentina, South Africa, Russia, China, Israel, Philippines, Peru, Egypt, Colombia, Venezuela, Thailand, Morocco, Poland, Czech Republic, Turkey, and India. according to the International Monetary Fund (IMF), such markets will experience about three times as much growth as developed economies. Here is what you need to know about investing in emerging markets:

Volatility

If you do not have a huge appetite for risk, emerging markets might not be the best bet because they tend to be volatile. Mark Mobius, the executive chairman of Templeton Emerging Markets Group, says investors should consider a 10% market correction as normal. In established and mature markets, such as the US, investors would view such corrections as indicators of an unprecedented selloffs or even a recession. As such, investors who cannot stomach double-digit market corrections should invest half of their usual asset allocations to emerging markets. This is according to Christiane S. Delessert of Montis Financial, an asset management firm in Waltham, Massachusetts.

Exuberance

Many investors tend to be upbeat about the outlook of emerging markets. This is largely because these markets will likely account for 70% of the world’s GDP growth over the next few years according to a Forbes report. However, this does not mean that the future of emerging markets will always be rosy. A report published by AXA Equitable Financial Services, LLC, warns investors that there is “no free lunch” when it comes to emerging markets investments. Financial or economic malaise in one country can easily spread to others. A good example is Thailand’s devaluation of it currency, the baht, in 1997, which triggered a chain of currency devaluations across the region. Most Asian countries devalued their currencies to ensure their exports remained competitive in the world market. With this in mind, it is wise to avoid exuberance when investing in these markets.

Hunting for Bargains

Stocks in emerging markets tend to have lower valuations compared to stocks in developed markets, which means finding bargains is easy. A report published by the Wall Street Journal (WSJ) shows that mutual funds and other large institutional investors have shifted their attention to emerging markets to hunt for bargains. For instance, Ivy International Core Equity, a mutual fund that usually invests 8% of its portfolio in emerging markets, has ramped up investments to 15%. However, current spreads are unusual according to Nathan Rowader, director of investments at Forward Management LLC in San Francisco. For example, companies in emerging markets have a price-earnings ratio (P/E ratio) of about 13.4. In comparison, this figure is about 18.4 in the US, which translates to a five-point spread. Nevertheless, Rowader expects this gap to close in coming years.

In conclusion, investing in emerging markets is not for the fainthearted because volatility in these markets tends to be quite high. In addition, investors should not be driven by exuberance to invest in these markets. Finally, finding bargains in these markets is easy.

Binary Options Trading Strategies

The Essence of the Advance-Decline Line Strategy

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The Essence of the Advance-Decline Line Strategy

The Advance-Decline Line, which is commonly referred to as the AD line or A-D line, is essentially a range indicator that is concentrated on net advances.  These advances represent the quantity of proceeding stocks minus the number of stocks that are decreasing.  When advances surpass they are definite and when they decrease they are negative.  In essence, the advance-decline line is the accumulative computation of net advances.

Typically, the NYSE or NASDAQ provides the advance-decline data on a daily basis.  Traders have the option of using the A-D line for the index, contrasting it to the movement of the authentic index. The line is designed to ensure a cost decrease or increase with indistinguishable motions.  Bearish or bullish differences in the A-D line are indications of changes in involvement, which could signify a price reversal.

The strength of the market is threatened when an inadequate amount of stock takes part in an advance.  Often, diminishing involvement is linked to a bearish divergence between the underlying index and the AD line.   On the other hand, when the A-D line and the underlying index falls to a new low, the market is considered to be frail.  A bullish divergence comes about when there is a failure of the AD line to attain a lower low in consort with the index.  This is an indication that insufficient stocks are lessening and the index reduction might be coming to its end.

Investors should be mindful of certain traits that may be carried by the advance-decline data.  Primarily, the NASDAQ AD line has a long-term sinking influence.  This is because the listing needs of NASDAQ are not as stern as the listing needs of the NYSE.  The NASDAQ has a content of upstarts in sectors, which fluctuate from biotech to alternative energy to technology.  While a massive upside probability is likely, there is the risk of failure as well.  A number of stocks in NASDAQ are vulnerable to being removed.  Failing companies are erased from the index; however, they leave behind their harsh effects on net advances.

Conclusion of the Advance-Decline Line Strategy

As it relates to the advance-decline line strategy, a broad advance is an indication of the massive bulk of stocks that are participating.  This will cause the AD Line to be sharply elevated.  A small advance is an indication of little involvement, which will cause the AD line to elevate only a bit higher.  The declines can be narrow or broad.  A wide-based advance is an indication of underlying strength by which most boats are elevated; this is considered bullish.  A smaller advance is an indication of a comparatively mixed market which is best qualified or most suitable.  An advance that has slender support is impractical to remain aware of the underlying index and will result in the formation of a bearish divergence. These divergences can assist traders in recognizing vital inversions within the market.

Investing

Growth Investing

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Growth Investing

When it comes to investing, different people have different trading styles and preferences. For any investment undertaking, growth of the invested funds is usually the number one objective on most investors’ lists. The best way to accomplish this objective depends on the prevailing factors like investment time frame and level of risk tolerance. Growth investing is a type of strategy where a trader buys stocks which have a substantial growth potential. Growth investing can also occur when a stock is trading below its daily threshold and hence bears a huge growth potential. Growth investment is of various categories, most of which have exhibited consistent growth patterns and it usually involves equity in one form or the other. The most prominent classes where growth investment is common are explained below.

Small Companies Stocks

In financial terms, the size of any given company is usually measured by its net worth which is depicted in its annual financial reports. In most cases, small-cap companies are considered to have a net worth of between $300M and $2B.When a company is in this category, it is still in its initial growth stage and its stock prices have a very mouthwatering potential for investors looking for growth.

Health Care and Technology Oriented Stocks

In terms of growth potential, companies that are associated with the development of new technologies are deemed to have a high growth potential for investors. Technological firms’ stocks tend to escalate in prices after a major release of a product over a very short period of time. Another sector that is associated with a high potential growth rate is health care firms which are oriented to production of revolutionary drugs ad medication. For instance, in 1994, Pfizer stock ranged at about only $5. After the release of Viagra, the stock price skyrocketed to $30 per share within a very short period of time.

High Risk Speculative Investments

Some high risk ventures like oil and gas stock trading are considered to have huge growth potential due to the uncertainties associated with the two sectors. An investor can buy stocks when the prices are on a downward spiral, speculating a price increase in the future. Investing in such sectors is however termed as very risky. In case an investor makes a wrong choice, he/she can stand to lose all the invested funds.

Before evaluating investment growth potential, it is of essence to first consider some key basics in growth investing. Most of the factors involve mathematical calculations and they are all aimed on the returns. An example of these factors is the return on an equity index. This is a calculation oriented factor which determines how efficiently a growth investor can make money from the said investment. For instance, when evaluating companies, an investor should evaluate the shareholders equity in relation to the net income of the company. When making a decision between two companies, this index can be of great help. For example, assuming that Company A  has a $200M shareholders’ equity and Company B has $500M shareholders equity, assuming they both reported an annual income of $100M, then Company A has a bigger return on equity as compared to Company B and hence it should be the preferred choice

Last Word

Growth investing is one of the successful strategies used in the trading market today. However, a slight mistake can cost an investor a great deal especially when one focuses purely on speculative growth investment.

Binary Options

No Faith in Bitcoin? Profit from Shorting It

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No Faith in Bitcoin? Profit from Shorting It

As the popularity of Bitcoins continues to increase, there are people who are skeptical about the future prospects of the BTC. Some people think that the value of Bitcoins is going to increase significantly over the next couple of years. On the other hand, Bitcoins are gaining popularity and acceptance in a number of industries. In fact, most online casinos and binary options brokers, among other financial services providers, nowadays accept Bitcoin payments. Experts expect the strong growth to continue and the value of the BTC against the dollar to continue rising. No faith in Bitcoin? Profit from shorting it. The following is a simple guide of how you can short the Bitcoin and make a decent profit.

Bitcoin Explained

Bitcoins are simply a type of digital currency that are generated and regulated by sophisticated software, which also verifies the transfer of funds. They can also be looked at as private currency that is free of manipulation, control or regulation of the government through the Fed or central banks. Since this currency is not regulated by the government, Bitcoin trading is also not under the supervision of the SEC, so it can be a risky venture. Fortunately, there are reputable Bitcoin trading platforms that make it possible for traders to buy and sell Bitcoins.

How to Short the BTC

Depending on your preferences, you have two options for shorting Bitcoin.

  1. Private Contract

You can simply find a friend, colleague, neighbor, business associate or relative who holds a huge chunk of Bitcoins and negotiate a deal. This is a much safer option because you know the person whom you’re dealing with. Be sure to check that the contract is enforceable by law.

  1. Bitcoin Trading Platforms

There are thousands of Bitcoin exchanges and trading platforms around the world. All you need to do is find one that offers conducive terms and conditions.

How it Works

When shorting the Bitcoin, the trader borrows a certain amount of Bitcoin over a specified period and pays interest to the lender. Lenders are usually other Bitcoin traders or the Bitcoin exchange. Once the lender transfers the requested Bitcoins to the trader, he or she can sell them for dollars, or their preferred currency. When shorting an asset, you assume that the strike price is at the highest possible point, or at least close to it, and that prices are going to drop within the term of the contract. This means that you will get a lot of dollars when you sell the Bitcoins. As the contract expires, with Bitcoin prices at a lower rate, all you have to do is spend some dollars to buy the exact number of Bitcoins that you borrowed at the current price and transfer them to the lender. By doing this, you will be left with some dollars, which is your profit. It’s as simple as that. With modern trading systems, shorting is very simple. No faith in Bitcoin? profit from shorting it.