Martingale’s strategy in binary options can be compared with a weapon in the hands of a person: an experienced person can turn a weapon into an effective means of protection, an inexperienced person can only harm himself and others. In a professional environment, this strategy is not loved and is considered a sign of fraud. It is not recommended for beginners to use it, but nevertheless, dozens of advisers are developed on its basis, showing effective results. How to apply the Martingale strategy, read on.
Martingale Binary Options Strategy
The essence of the Martingale strategy is to increase the rate in case of an unsuccessful forecast. The first misconception is that we are talking about doubling. This is true for Forex, but not for binary options. Example for a deposit of 100 dollars. US with 90% yield:
- make a forecast in the amount of 2 dollars. USA. Option out of money, double the rate;
- 4 dollars. USA. In the case of an option “in money” we get 3.6 dollars. United States, recouping the previous loss. We double the bet in case of an error;
- 8 dollars. USA. Potential profit – 7.2 dollars. USA. In case of loss, double the rate;
- 16 dollars. USA. Potential profit – 14.4 dollars. USA. Double bid;
- 32 dollars USA. Potential profit – 28.8 dollars. US, but the previous loss is 16 + 8 + 4 + 2 = 30 dollars. United States.
Only 5 erroneous forecasts it took us to lose almost the entire deposit of $ 100. USA. And only doubling the rate, even in the case of a successful forecast, we would be at a loss. Martingale Calculators offer the following series of bets:
Please note that in the case of a successful 6th forecast with previous losses, the profit would be only 1.6 dollars. USA (75.6 at a previous loss of 74). The risk of loss would be 158 dollars. USA. Potential profit is incommensurable with potential loss.
The strategy of martingale in binary options do not like it because of the high risks that are not comparable with the possible profit. Its mindless use often leads to a loss of the deposit within a few minutes, since a series of 5-7 losing trades is not such a rare occurrence.
How to apply the Martingale strategy in binary options:
- Do not trade in the flat, catch strong trend movements. If the correction brings a loss, the main trend will increase the probability of a successful forecast;
- work with expiration and timeframe for more than a minute. Even a strong trend has kickbacks and corrections;
- combine strategy with technical indicators and confirmatory oscillators;
- Test your strategy on at least 100 transactions. It will show a series of losing contract trades;
- select the rate and the amount of the deposit by the Martingale calculator.
Summary. Martingale in capable hands is a powerful tool for optimizing strategy. The use of its elements can reduce potential risks, but the Martingale itself can bring a loss. The ratio of the rate of increase and the appropriateness of this increase are selected empirically on a demo account based on system test data using mathematical statistical methods.