IQ option is one of the most popular and well-regarded binary options brokers in the world. With millions of members from all corners of the globe, IQ Option is truly a market leader.
This binary broker offers a unique business model for you to invest in. You can choose from among all sorts of assets, and the IQ Option trading platform is truly one of the most elegant and functional platforms in existence.
If you open an account with IQ Option, you will enjoy all the benefits a binary trader can hope to find with his or her broker.
But the excellence of IQ Option’s service offering does not in itself guarantee success. In order for you to take full advantage of IQ Option’s market leading trading platform and other outstanding offers, you need a good strategy.
In this article we will present some of the best strategies that you can rely on in order to make a healthy profit as a trader with IQ Option.
Make sure you trade in assets you understand
A very important strategic decision that you must make as a trader with IQ Option is to choose which assets you wish to trade in.
All binary options are based on assets. You job as a trader is to predict whether the price of this asset will move up or down during the course of the binary option’s expiry time.
Clearly, you will have a better chance of making correct predictions if you trade in options that are based on assets that you have a good understanding of.
This is a particularly important strategic consideration with IQ Option because this binary broker offers a much wider choice of different assets than most. Whereas some binary brokers only have a handful of options on offer, IQ Option lets you choose from a vast selection.
This is positive because it means that you will find assets you are familiar with regardless of where in the world you are from
It can also be a challenge because some of the assets on the menu might be alien to you.
For this reason, the first thing you should do when formulating your IQ Option strategy is to investigate the assets on offer. Find the ones you understand. For example, if you’re from the US, you might prefer to trade in stocks such as Coca-Cola or Yahoo; if you’re from Russia, Gazprom or the ruble might be more suitable.
Pick the right expiry time for your options
When you are trying to establish a winning IQ Option strategy, you need to keep expiry times in mind. An expiry time is simply the time it will take from you make your investment until the binary option ends, and you either win or lose your money.
Expiry times can vary from only a few seconds to several minutes, and even the entire trading day. IQ Option offers the whole range. In other words, you can make investments in binary options with expiry times ranging from 60 seconds all the way up to the end of the day.
This means that each time you make an investment you have to specify over what time frame you predict that the price of an asset will make the price movement you predict.
It is of fundamental importance that you get this strategic decision right.
Our advice is to trust technical analysis. What does the price chart tell you? Will the price show a steady, long-lasting movement? Or is it moving erratically, going up and down in a zigzag pattern?
You can use a lot of indicators in order to find the answer. Based on this, you should choose the expiry time that suits your prediction best.
Make your trades at the optimal moment
You have to develop a strategy that allows you to make trades at the right moment. With IQ Option’s tremendously wide choice of assets, you can – hypothetically – trade 24/7.
The reason for this is that IQ Option have assets from all over the world, in markets within all sorts of timeframes, on offer. Basically, you can trade all day and all night by investing in assets from New Zealand at some point, the US at other times, then in Europe and finally Asia.
So, what’s the best strategy when it comes to timing your investment? There is no golden rule, but there are some considerations that can help you find the answer.
A very important thing to keep in mind is volume. Basically, the more investors are actively buying and selling an asset, the easier it is to predict its price movements.
This means that you can trust trends that occur during times of high trading volume with greater confidence than trends you see in times of low volume.
Generally speaking, we can say that high trading volumes are seen during the middle of the trading day. If your strategy depends on high volumes, you should avoid the last hour of trading.
Always stay on top of money management
A very important part of your IQ Option strategy has to be money management. Money management is a strategy for how much money you should invest per binary options trade.
It is of crucial importance that you understand money management, and that you develop a sustainable money management strategy.
If you invest too much per trade, a losing streak can have catastrophic consequences. If you do not invest enough in each trade, you risk not earning the money you deserve on winning trades.
Both these scenarios can ruin your chances of earning a healthy profit over time as a member of IQ Option.
Luckily, there is a golden rule here. That is to always invest between 2% and 5% of your capital in each binary trade. By doing this, you protect yourself from losing streaks (which all traders, even the pros, incur), and you will make a sufficient return on trades you win.
Obviously, your account balance will change for every trade – it will go down every time you lose, and increase every time you win – so what constitutes 2% – 5% will change constantly. It is important that you keep an eye on your balance, and adjust your investment size accordingly.
Manage your risk
In all kinds of investments, you need to choose between taking big risks with a change to earn big rewards, or take smaller risk with a chance to win smaller rewards more frequently.
Trading binary options with IQ Option is no exception. You have to determine whether you are a risk taker, or whether you prefer to play it safer.
This is really a question of personality. What suits your temperament best? To win small amounts regularly, or winning much bigger rewards more rarely?
Answer that question honestly, and choose your strategy accordingly. You will not be able to stick with your chosen strategy if it contravenes your natural disposition.
And that’s the most important part of risk management: you have to stick with your choice. If you decide to trade with low risk, you need to continue to do so over time, consistently.
If you do, then you will win enough small rewards over time to make it viable. If you don’t you risk losing high risk trades that will ruin your overall performance.
The same is true in reverse for high risk trading. By chopping and changing between the two, you risk suffering the drawbacks of both without enjoying the benefits of either.