When you trade with best brokers digital options, you’re given the opportunity to utilize a Take Profit strategy via use of the “Sell” feature. What this feature offers is the ability to sell select open binary options trades back to . When a position is sold while the asset price is out of the money, then Sell is being used as a stop loss of sorts. On the other hand, whenever you sell a position that is in the money, you’ll be locking in some profit.
Now, the question that many have about this strategy is: Why would I sell my seemingly profitable position for a small amount of money when I stand to earn up to 85% if it finishes in the money? There are actually a couple of valid responses to this question. For starters, should you feel confident that your binary options trade is going to be in the money at expiry, then do not sell. It’s a simple as that. However, if the price action is volatile and you’d like to exit the trade with some profit, then selling is your best option.
Another option for selling is to enter into trades with the intention of locking in some profit as soon as the asset price moves into a profitable position. This type of binary options strategy is not going to provide you with the same massive profits that are offered with winning trades, but for traders who are extremely cautious with their funds, selling for small profits can be an excellent method. With an increased trade volume it may be possible to earn just as much as you would with full-profit outcomes.
Important side note – be sure to select the Sell feature instead of trade cancellation whenever possible. Certain trades can be cancelled once the contract goes live. However, abuse of this feature can cause you to lose your trading account. All binary options brokers have rules in place about the use of trade cancellation, so only cancel a trade when you feel that it is absolutely necessary to do so. Otherwise, sell the option to exit the trade with a small loss or small profit once you realize that you’re ready to close.
The most solid take profit strategy is one in which you sell some options, but allow others to complete their course. If you spend all of your time selling, then it could take quite a while to build up substantial profits. But if you combine profitable finishes with small profits from selling under volatile conditions, you get the best of both worlds. With just a bit of practice, you will instinctively know when to sell an option and when to allow it to run all the way until full expiry.