Nadex Review 2017 - Advanced Binary Options Trading

Hey guys, welcome back to the channel. As promised, I'm doing a video segment on advanced binary options trading. If you're new to the channel, we encourage you to watch our other binary options trading videos. This will as well be a review of the Nadex trading system. So the Nadex stands for Northern American Derivatives Exchange. Nadex is a regulated binary options broker. They're regulated with the Commodity Futures Trading Commission, and unlike many binary options providers, Nadex does not take the other side of member trades or engage in trading of any kind. Member funds are held in segregated accounts in U.S. banks. So this is all very important. What it means is that the Nadex is regulated in the United States. That means there's government oversight. So that's great. That puts the lid on scams we can get from companies that provide binary option services. The Nadex doesn't have any interest in the options provided in the exchange. They only provide the platform and we place the orders and are matched up with the CFTC, who everyone has to go through to become licensed brokers. I spent years as a commodities broker and had to go through the CFTC and NFA. Or National Futures Association. So that's already a great plus for this platform as it's monitored. You don't have to worry about changes in system quotations and missing orders or horror stories like orders that were changed by the companies to scam customers out of money. So although in standard market trading and placing of orders, this would be looked at as just normal trading, The reason we're calling it advanced trading in binary options is that most of the binary options markets operate primarily on a much more simplified design platform. It's very user-friendly. However, in traditional trading, it's a bit more technical. And whereas in most binary option systems, you just are hitting the buy or sell order button, on the NetEx system, you actually have to write an order ticket. That does require a bit more skills. In addition to that, there are also many more features and things you can do with binary options on Nadex that you can't do on other systems. So this segment will consist of several other segments as this information is a bit more technical than most binary option users are accustomed to. So we'll first review the system in regards to its features and how we can use it. The future segments will go more in depth about how you can place orders and how you can even get out of an order. So great show coming up. We have some very important information, so stay tuned. So first, let's talk about a very important feature the Nadex system provides. This is you can get out of your order before the option expires. Now, most binary option traders are generally going to be locked into a trade until it expires, which means if they find the trade is going in the wrong direction, they have to stay in there. There's nothing they can do but hope it turns around. However, however, with the Nadex system, you can sell out of the contract before it expires, sometimes at a gain or a loss. Either way, you can either minimize losses or you can take the profits before the option expires. So that gives us a great deal of control, which some platforms don't have. Uh, now in some cases I've had a trade in profits early on. However, by the end of the trade, it had become a losing trade. If I had the ability to exit earlier, I could have taken profits when the markets were in my favor. So that definitely is a great situation for the Nadex. So another great feature of the Nadex is duration of the binary option. Now on the Nadex, binary options are written as contracts. So it's a binary option contract and you can place an order up to a week. Now some binary option traders don't allow you to go that length of time. Some only go for a few hours or at best a day. So with this feature, we have an adequate time frame to let the market respond to our research data, which means we have to, we have to rely less on probability and more on good information and research. So let's recap on what's great about this system and what will be using in our next advanced progression of binary options trading. So we first established it's regulated by the United States government. That's self-explanatory. When dealing with overseas binary option brokers or unregulated ones, we have no idea what may happen. They may close overnight, or it's possible they can manipulate the system on their end somehow. Well, or maybe we can't take money out because they aren't liquid. Whatever negative things could happen, uh, with this system or the Nadex platform, they have government oversight and legal action can be taken to stop such acts. Next, what's good is being able to get out of an order before expiration. And last, we have longer contract lengths so our market research can be applied. So this will work very well with our next level of trading. So first, it's important to understand that on this level we will no longer do minute options. We classify minute options in our beginner trading levels as more so a means to get your feet wet, to build up your account funds if you're starting out with low to no capital. And as a more aggressive approach to trading with small capital to grow your account. However, once we have an account of traditional trading size, in this case I say a minimum of $2,500 to $5,000, at this point we'd be ready for trading in a much more advanced format. As well, we'd be using the Nadex. An idea, every trade we make, we want to place an order no more than about 5% of our entire account balance. Okay, so that's for every individual trade. Never go before beyond 5% of what you have on deposit. Now we'll be placing the order in a moment here, but we want you to understand how Nadex contracts work. Every individual contract has a payout of about $100. You could buy multiple contracts at once on your order ticket, but whatever you pay for the contract, you have to minus that from $100, and that will be your profit. Okay. So for example, a good quality contract that may run us about $50 will pay out $100. So we'll profit in that example about $50, or $50 minus the commissions, or $50 plus commissions, as commissions are, uh, how Nadex makes their money. It's not like binary options, uh, which take 10 to 30% off the top and we only get what's left which may be a 70% return or 80 to 90%. But with Nadex, your payout can be much higher than normal binary option brokers because of that. And their commission is only $1 per trade. So a lot better system than other binary option brokers that take 10 to 30%. In comparison, Nadex will end up being a lot less than that. So we know how the contracts work. We know how much money we should be placing at maximum per trade. Let's deal with how long our contract should run. This is another advantage we will implement in our advanced options trading system. So we discussed earlier that one issue we had in our beginner segment is that through use of minute options, we have very little time for trades or the data to affect the market research So we'll have less of an issue with that in this level of trading. That is because we will trade over periods of weeks, not days or minutes. So our contracts, we will enter on periods of a week. So that will give us simple time for the market to move in our direction. Now, even if before the contract expires you're favorably in profits, you'll have the option to close that contract at a gain. And if it looks like we're going to lose, we'll still have enough time to close it out and minimize losses, which is great and may be necessary in some cases as the market may be affected by some unforeseen occurrence we can't control. So now we're starting to get the blueprint of how our next level trading will be done. So at this point, I want to place an order so you can see the system at work And as I said, we'll be breaking this series down into next doing orders and understanding them more clearly. And as well, a video on market research as our new way of picking trades will be significantly different from how we did it on Minitrading in the beginning levels. So let's do a trade so we can see how everything will work. All right, so first we're gonna select Forex here cuz that's what we're trading and Just for this example, I'm gonna pick the Australian dollar here. Okay, and I'll pick the weekly because that's what we're gonna be doing. All right, and so generally what, what our system would like to do, if you come down here and see the orders, we usually want to get a— or select an order around somewhere around the $50 mark. And I'll explain why a little bit here, but in our upcoming videos we'll go much more in depth than that. And that, that has to do a lot with the strike price. Usually the, um, the easier it is to get to a strike price, the more the value of the option increases, if that makes sense. So I'm gonna select here, we're gonna buy it around $53.25. And if you look here on this screen, this is where it's significantly different than a lot of the other binary option platforms because we can actually place in here whatever amount we wish to pay. And, uh, um, so we can— they already have an ask price, uh, of $46 here on the left-hand corner. And then, and basically what your, what your bid is, or I'm sorry, the bid, what the bid is, that's what the buyer is willing to pay at this point. So that's the first box here on your left-hand corner, it's called the bid. And on the right you have the ask price, and the ask price is basically what the seller is willing to sell the item for. Option for at this point in time. Now, next, if we go down here, we have market. And as I select market, we see two things here. We see a market order and a limit order. Now, the market order is only saying we're going to buy at whatever the price of the market is at that present time, but we're not going to do that. We're going to always use a limit order because limit orders allow us to put in whatever price we wish to. So as you see here, next we have the size, and the size is basically how many contracts you wish to buy. So if you want to buy— remember, each one, each contract pays out $100, and for each contract, whatever price we'll be paying, which at the market right now, um, or what the bid is, is $47.25, and what the ask is, is $53.50. Um, whichever price we wish to pay, uh, we can put it in the box, or we don't have to pay in it. We can pay a price somewhere in the middle. But here's what we need to be mindful of: if it's not between these two prices, then it's probably not going to be filled, which means they may not accept our order. But now, if you want them to select the order, you just go ahead and you select— you just buy at the market price. But we're not going to do that because a market order is self-explanatory. So I want to show you how to do a limit order. So, uh, we're going to select us one contract here. And here, there we go. Let me enter what I want to pay. So I would like to not— I would like to pay— I'm going to get close to that price. I tell you what, I'm going to do $53. And then I simply hit place order. And as you see here, it says order received. So that means they've taken my order. So open trade. So I'm gonna hit OK. And now we're gonna look to see if our order has been taken. So let me scroll down here and let me find a section here. Where it shows our place orders. And when you're doing this, uh, this is actually on a mobile app, but you'll probably be doing it on a desktop app. And on the desktop app, it's going to be very similar to this platform. Um, but, um, and I'm going to go here to history. Okay, over the last— we're going to hit view history here. I just want to see if my order has been Okay, so there's my order right there. Uh, okay, all righty. So, you know, as I said, in the next videos we'll go more in depth on how to place orders, but just want to give you a feel of what it's going to be like when we start trading in this platform. So the first part of the Nadex review covered the good things about Nadex. So to complete the review, let's go over the bad things. Well, when compared to the user friendliness of the binary option brokers, even the scam brokers, Nadex is not a very attractive or user-friendly system. It just looks a lot more confusing than it needs to be, and I'm surprised that it's not done better than that. You know, they should work on improving that. You know, like I said, um This is more on the mobile app side of, you know, of the platform, but I actually did the desktop too when I wasn't on the go, and the desktop is even worse than the, than the mobile, you know. So you're not gonna get much, you know, away from, from that. It's just, it's just done, you know, really bad. It just looks, you know, I'm surprised they didn't do a better job than this, you know. And they should work on improving it. Also, if you're a binary option broker, um, or if you've been on ones that, uh, and you've never written an order ticket, you have to go through this learning curve with this, and that's going to take time and offset your trading, uh, as well. It's a $250 minimum. Now, from our system standpoint, that's not specifically an issue, uh, as by the time we use Nadex, we'd encourage you to have at least about $2,500 $5,000. However, if you want to use the features for this system and trade it with the security, you need a minimum deposit of $250. And whereas that's not a problem in itself, the problem is that on average, to get a good contract, you're going to have to pay around $50. Cheaper contracts have a less desirable strike price and And oftentimes that generally means you won't win if you can buy that contract fairly cheap, which means on $250 and you paying about $50 per trade, you're only going to be able to get around 5 to 6 trades in on a $250 budget, budget, unless you're winning well. So that creates a bad situation for the guy who only has $250 to invest but wants to try this system. But overall, I have to give the Nadex trading system a 92%. So it still gets an A, just a low A, an A-. But putting into account other binary option brokers, I think Nadex and Markets World are probably the only two I would trade for now. There is 24Options And as I understand, it has some similar features to Nadex. I have tried the system, system, and I do like 24Options trading platform. In fact, I like it a lot better than Nadex and Markets World. However, the issue with 24Options is they as well require a $250 deposit. So you all know how I feel about larger deposit requirements. I don't think binary option brokers, unless they are government regulated on the level of Nadex should be, um, requiring a larger deposit, you know. So I'd advise you to just deposit on Nadex unless you're overseas or something prohibits you. But yes, that's my review on Nadex and our advanced trading system. Our next set of videos will be about how to place a market order on Nadex as well as how to exit trades early and how to do research so we know what to trade, as our techniques will be slightly different than how we've done it in our Minute Options videos. So take care, guys. Make sure you watch our other videos. Links will be in the description to these trading systems and format. And until next time, we'll see you later.