Many people decide whether to go ahead with particular investments because they look at what can be gained. This can be the case with binary trading, where the gains can be very big compared to many other types of investments. It is something which is easy to do without any knowledge of the stock market as well and so may not seem as daunting as other types of trading.

However, it is very important to have a good knowledge of binary trading before you start. You can 
learn more here about binary options trading and it is worth taking a look here and at many other sites so that you fully understand what you are getting in to before you spend any money.

It is important to understand that although the gains in binary trading can be extremely good compared to other investment schemes, the losses are big as well. Basically, you will be guaranteed a fixed return either in cash or assets under certain circumstances but if the market does not behave correctly, then you will lose everything that you have invested.

Many people consider it to be gambling because you are putting money down based on the market behaving in a certain way. Often the investments are just for a few minutes so you may pick a stock and bet on it either going up or down in the next five minutes and how it performs will determine whether you get paid or not. Obviously there is an element of skill, because you can predict the stock market, just as people do when they are buying shares, but because the period that you are predicting or is so small, then there is a very big risk that you will be incorrect. It has been calculated that you will only win 45% of the time and so ultimately the odds are against you.

These could be considered to be better odds than many gambling games though, where you will often only win one in four times. However, the amount that you win, will also play a part in this. If you spend £100 each time and win 1 in 4 times but only win £50 then you will make a £350 loss. However, if you win £1000 then you will make a £600 gain. In binary trading you may invest £100 and get £125 back or you may lose everything. With 55% odds of losing then it is likely that you will lose every other time you invest and so will make a slower loss over time.

There will always be people that beat the system but there is a great deal of risk and very little that you can do to improve your chances of winning something. This is why it is seen very much as gambling rather than investing. Investing tends to be more likely to give a return and a more long term prospect.

By Jasmina