Many binary options brokers now provide traders with the Double Up feature. This is an optional feature which typically allows an open position to be duplicated with one click. When used, this tool will create a trade that is identical, with the one exception being that the new contract will open at the current market price of the asset, and not the same entry price as the original contract. The primary risk will of course be the potential of incurring a double loss should the market turn against you. Because of this, selective use is highly recommended.
The strength of price movement is a major consideration, but so too is the investment amount. If the initial amount is high, and there is any question in regard to whether or not the trade will finish in the money, it can be wise to take the time to not use this feature. Trade execution typically takes less than one minute, so a new trade with a reduced investment amount could be opted for when upcoming price action is in doubt. Unless a strong trend is in place, Double Up is not a feature that you’ll want to be using.
Even when a trend is in place, you’ll need to determine with some degree of accuracy just how long the current direction of movement may continue. Since any replicated trade would be using the same expiry time as the initial trade, the price movement will need to be strong enough to push on until the secondary option expires. For those who are new to binary options trading, a trend is defined as price movement which continues in a single general direction for a period of time. There will be some bounces along the way, but the same general direction should be quite noticeable.
Double Up is only available for a period of time, after which the option to double will disappear. The safest method of using this feature will involve waiting as long as possible to make a decision. Double Up is not provided along with short-term binary options trades such as Sixty Seconds, so there should be time to come to a decision. The one exception here would be if the price is spiking and you fear that too much time will increase the chance of a price reversal. In this case, doubling sooner than later would be the safer move.
Although not common in modern platforms, there is a form of Double Up that simply doubles the investment amount on an open trade rather than creating a new position. Since the expiry time will not change, it becomes a bit easier to make a decision about whether or not to use this tool. Again, it is wise to wait to see how the price movement is progressing before making a final decision, but the option to double will disappear as the conclusion of the trade draws near.
Double Up is an optional feature, which means traders are free to completely ignore it if they choose to do so. However, its use can be beneficial at times, as fast trade execution can pay off. If market conditions are too erratic, this tool provides little to no benefit. On the other hand, there will be times when a strong price trend can be even more profitable when an open binary options position is doubled.