Profit and Risk

The following is a basic formula that you can use to calculate how you are doing with binary options:

Profit = Trades x $ Amount  x { ( Success x Payback) – (1 – Success ) }


Profit  is exactly as it says, the profit you make. We will take it as profit after 1 month of trading as that is a fair amount of trading to see results.

Trades is the total number of trades taken for that month.

$ Amount  is the amount in dollars/Euros or GBPs invested per trade. We will use $20 per trade in our example.

Success is how many trades we won as a percentage of all trades taken.

So, taking our September results and plugging them into our formula.

Profit = Trades x $ Amount  x { ( Success x Payback) – (1 – Success ) }

Profit  = 334 x $20 x {(60% x 78%) – (100% – 60%)}
Profit  = 334 x $20 x {(0,60 x 0,78) – (1,00 – 0,60)}   work it out in decimals
Profit  = 6680 x { ( 0.468) – (0.4) }
Profit  = 6680 x 0.068
Profit  = $ 454.24

You can plugin you own amount into the equation to work out how you would have done.

Use the same formula to work out our other months results by plugging in the data.

As you can see, binary options is a numbers game.

Other than that, our trading statistics are quite consistent, although we do have months with a higher winning percentages quite often as well as higher average payouts.

On the binary dot com platform, the payouts fluctuate between 70 – 86% usually. They have their own algorithm but on average over the month it is around 78%.

Now, the only factor that you can affect with regards the outcome is the trade amount.

Obviously the higher the stake per trade the more will be the profit at the end of the day, but of course so will be the draw down in a losing sequence.

We suggest to have your account funded correctly and to trade with 1-3% of your account balance and a maximum of 5% of your account balance per trade.

For example if you wanted to be trading $10 per trade, then ideally you want to have your account funded with at least $200 and that would be 5% of your account balance.

If you want to be trading with $20 per trade, then you would need an account with at least $400.

To trade with just $5 per trade which is the minimum in most countries and certainly the minimum that we suggest to make it worth the effort, then you would need your account funded with at least $100.

A good plan of attack is to build up your account and then slowly but surely increase your trade amount as you balance increases.