Iq Option Strategy Digital

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Digital Options. Introducing a New Trading Tool

A Digital Option is a new trading tool developed by IQ Option. It combines features of both classic and binary options. A digital option provides an opportunity to trade a variety of instruments. The profitability and the risks of each deal will depend on a manually chosen strike price, which is its main distinctive feature.

A Digital Option price chart as displayed in the IQ Option trading terminal

Breaking Down Digital Options

Digital Options offer a high degree of freedom and a higher earning potential than binary options, the profitability of which is predetermined. A trader can vary the amount of potential profit and risk by simply adjusting the strike price. When moving the strike price closer to the current level of prices, a trader will decrease the potential profitability of the deal and at the same time limit the amount at risk. Conversely, a trader can take the additional risk by pushing the strike price further from the actual prices and hope to receive higher profit.

Risks and profit potential depends on the distance between the actual and strike prices

Traders have a chance to choose between one and five minute expirations. A Digital Option can also be sold before the expiration date. If the trader feels that the trend is taking the wrong direction, he is free to sell the option at any time. The deal can be set up with just a few clicks. Here are the steps you would want to take in order to do so.

Trading Digital Options

To make a deal the investor is required to take the following steps:

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  • Choose the desired asset,
  • Choose the expiration period,
  • Choose the amount of money he wants to invest,
  • Select a strike price,
  • Click “ CALL ” if he believes the price will go up or “ PUT ” if the price in his opinion is supposed to go down.
  • Wait for the expiration time to come or sell the option prematurely.

Basically, there are only three parameters apart from the asset type the trader will have to adjust when setting up a deal: the amount of money invested, the time period and the strike price. Nonetheless, the number of strategic options available is high. Depending on various factors, some traders will consider it unwise to choose the strike price that is too far away from the current price level if they believe the price will simply not reach the desired level. Some other traders will go for a higher/lower strike prices, being ready to accept the additional risk while chasing higher returns.

Note that digital options will expire-in-the-money only if the actual price is not identical to the strike one. For call options it should exceed the strike price by at least one pip, for put options it should fall behind the strike price by at least one pip.

Different strike prices should be used for weak and strong trends

Mitigating the Risk

Risk management rules apply to digital options deals too. Some traders believe that allocating more than 3% of one’s trading capital to a single transaction is too risky and does not help trading in the long run. Taking your time to learn and practice different trading strategies and techniques on a Practice account is always highly recommended.

NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future.
In accordance with European Securities and Markets Authority’s (ESMA) requirements, binary and digital options trading is only available to clients categorized as professional clients.

GENERAL RISK WARNING

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.
87% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Best IQ Option strategy PDF 2020

Trading systems offer many different strategies. This is a defined mode of action, which helps to fill deals and make them profitable. A successful strategy will allow you to make accurate forecasting and analyze the market.

But there is a mistake made by beginning traders – they see trade as a game or as a lottery.

They hope that their luck and fortunate event will lead them to fabulous profits, but a good trading strategy is the most important element in this sphere of earnings. A trader can consider his trading technique, but the best IQ Option strategy 2020 will help him to move in the right direction.

How to choose the right strategy?

The trader must take into account his personal beliefs and principles, carefully study each stretch and test the appropriate options. This is not a lottery or a set of simple templates that will work for you. You need to understand the market, determine its principles and spend time on studying each strategy.

Professional traders can make excellent profits because they spent their time studying the market; they studied its features, tried different strategies, risked and chose their scheme.

This is not enough just to choose a strategy and to expect that it will bring you 100% profit – you need to give time for its functioning. Choose your strategy, study it and maybe you’ll see that trading with a broker can be a lucrative job, not a lottery.

There are strategy-templates, that is, it is a gift from more experienced traders.

This is a defined system that is operating in the middle. The strategy is not just a way of moving and converting deals; it’s a market analysis, technical analysis, indices of different indicators, algorithms and much more.

Each strategy is based on specific principles, but each scheme can have its own shortcomings and advantages. You can not just choose a strategy; you need to know more about this in order to secure your assets.

There are some pros and cons

Every strategy could have its advantages and disadvantages, even if we would take IQ Option best strategy 2020.

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