Binary options robots results
Binary options robots promise to make you rich. But which binary options robots results can you actually expect? We have the facts. Based on cold, heart math, we let you know how much money you can make with a binary options robot and help you decide whether a robot is right for you.
In detail, this article will answer these questions:
- Which binary options robots results can I expect?
- How much can I earn with a binary options robot?
- What are the pros and cons for trading with robots?
With the answers to these questions, you will immediately be able to understand the results you can realistically expect from a binary options robot, and you will be able to decide whether a robot is the right choice for you.
Binary options robots results
So what results can you expect from a binary options robot? Well, there are two aspects to this answer.
- The general aspect. Which results can you expect from binary options robots in general?
- The specific aspect. Which results can you expect from the specific binary options robot that you are looking at?
The key to getting good results is understanding both aspects and how they relate to each other. To help you with this task, we will take a look at both aspects individually and then see how they relate to each other.
Which results can you expect from binary options robots in general?
There are two key factors to the results you can expect from binary options robots: accuracy and average payout.
- The accuracy of a robot determines which percentage of your trades you will win, and
- The average payout determines the profit you will make on each winning trade.
To make money with a robot, it should have at least have an accuracy of 70 percent. There are robots that win even more than 70 percent of their trades, but an accuracy of 70 percent is generally the margin you have to achieve to make a nice profit. There are more than enough robots out there with an accuracy of 70 percent, and if your current robot wins less than 70 percent of its trades, it is time to make a change.
Bad robots sometimes win only 50 percent of their trades. You should never use a robot like this. Since binary options offer only two options for what can happen, you would win 50 percent of your trades even if you invested randomly, just like with a coin flip. For a robot to be worth its money it needs to improve this value significantly.
The best robots win around 75 percent of their trades. There are some robots that have won 80 percent or more of their trades in the past, but these robots are still young. The odds are that they simply started out on a stroke of good luck and will eventually settle in around the 70 to 75 percent accuracy, too.
In terms of average payout, the ultimate decision is out of your robot’s hands. Your robot connects to a broker and places its trades according to the conditions that this broker offers. Consequently, your robot only indirectly decides the payout it receives by which brokers it can connect to.
- Robots that force you to connect to bad brokers force you to accept bad payouts.
- Robots that allow you to connect to good brokers allow you to get good payouts.
To maximize your results with robots, choose a robot that can connect to good brokers. Good brokers offer at least an average payout of 70 percent. If your current broker offers an average payout of less than 70 percent, take a good look at our top list of the best available brokers and make a change.
Which results can you expect from the specific binary options robot that you are looking at?
Now that you know which results you can expect from robots in general, you have to find out which results you can expect from the robot in front of you. When you can estimate this robot’s performance, you can relate it to the performance of robots in general, and you know whether you have a good or bad robot.
Let’s start by determining your robot’s accuracy. There are three ways in which you can find out how much of your trades you would win with a robot.
1. Take a look at the robot’s history. Because robots use a system called technical analysis that relies on strict rules and precisely defined trading algorithms, they maintain the same accuracy on average over long periods of time. To know which accuracy you can expect with a robot over the next year, you only have to look at the past year. Most robots publish complete accounts of their past signals, which allows you easily to determine the accuracy of this robot in the past. Project the same results into the future, and you know which percentage of your trades you would win.
2. Try a robot with a demo account. If you want to see for yourself which results you can expect from a robot, the easiest way is using a demo account. Demo accounts work just like regular accounts but allow you to invest play money instead of real money. This risk-free environment is ideal for testing a robot – if your account balance grows over time, you know that the robot works for you. If you lose money, you know that you have to try a different system. Since most brokers offer detailed accounts of your past trades, you simply can let the robot trade for a while and then come back to see how did.
3. Try a robot with the minimum investment. Unfortunately, not all brokers and robots allow you to connect a demo account to a robot. If you suffer from this problem, too, you should try the next best thing: using the minimum investment. Many brokers allow you to trade from $1 per trade, which means that your risk is very limited. As we detailed before, even the worst robot has to win at least 50 percent of its trades, which means that even if you are trying a bad robot, you will not lose all of your money, you will only lose some money. With $1 per trade, you could get by on a $50 investment, which is a small risk compared to the incredible profit you can make.
Try one of these three methods, and you will know your robots accuracy.
With approach two and three, of course, you will know everything about your system.
- From the trades that your robot made, you can not only deduce its accuracy; you can also determine the average payout that your broker pays you.
- From the changes in your account balance, you can determine whether the entire system works for you. If your account balance grows under these conditions, it will also grow when you invest more money.
If you use the first method, you have to determine your average payout separately. You can do that with a demo account, in which case evaluating your robot’s past trades would be a preliminary step to using a demo account, or you can read our broker reviews and learn each broker’s average payout from there.
Regardless of how you do the testing, as long as you know the accuracy and the average payout that you can expect, you know which results you can expect.
How much can I earn with a binary options robot?
Knowing the results you can expect from a robot is fine. But the question that really matters is how much you can earn with a binary options robot. To determine the answer to this question, you can do some simple math.
Your earnings with a robot depend on two factors:
- The percentage of trades that you win,
- The amount of profit that you make on each trade.
We have both of these values, so let’s calculate the result. All you have to do is multiply your robot’s accuracy with the average payout plus 100 percent. You have to add the 100 percent because when you win a trade, you are not only getting the payout, you also get all 100 percent of your investment back.
The final formula looks like this: average return per trade = accuracy x (average payout + 100 percent)
As we said, you should never accept a broker with a payout of less than 70 percent and a robot with an accuracy of less than 70 percent. So let’s use these values and see what you would get. The formula would look like this:
Average return per trade = 70 percent x (70 percent + 100 percent) = 119 percent
This means that you would get 119 percent of your investment back on every trade. In other words, you would make a profit of 19 percent on an average trade.
Now, the average robot places between 5 and 15 trades a day. Assuming the worst-case scenario and multiplying it with 200 trading days a year, that brings us to 1,000 trades a year. Over 1,000 trades, a profit of 19 percent per trade amounts to a total profit of 19,000 percent of your investment per trade.
- If you invested $10 per trade, this system would earn you an annual profit of $1,900.
- If you invested $50 per trade, this system would earn you an annual profit of $9,500.
- If you invested $100 per trade, this system would earn you an annual profit of $19,000.
Since you should invest about 2 to 5 percent of your overall account balance per trade, you can estimate the amount of money that you need to achieve these results. To invest $10 per trade, for example, it would easily be enough to have an account balance of $500. In this case, the system would make you a profit of 400 percent within a year – not bad.
What are the pros and cons for trading with robots?
When we look at these result, the pros and cons of binary options become clear. Let’s point them out in detail.
Pro 1: The right binary options robot can help you trade on a high level in the long term
When you have the right binary options robot, you can expect to make a steady profit in the long run. A system that works now is almost guaranteed to work for years to come. Even if you start with a small investment, the power of compound interest will help you significantly to grow your capital.
Having such a system is a great advantage. The fixed monthly subscription fee means that your costs decrease compared to your profits over time, which means that your trading will become more and more profitable.
Con 1: The wrong binary options robot can lose you money
When you choose the wrong binary options robot, you might lose money. Bad robots will not ruin you over the night – they will at least 50 percent of their trades, too – but they can lose you money every day if you ignore the signs and miss the time to pull the plug early.
Pro 2: Finding the right binary options robot is not that difficult
Luckily, it is relatively easy to find the right robot for you. Demo accounts, 60-day money back guarantees, and detailed overviews of past results provide you with the ideal opportunity to test a robot risk-free and to know what you get before you invest big money. Additionally, many brokers allow you to start investing for as little as $1 per trade, which puts you in the perfect position to start small and increase your investment as you feel more comfortable.
This pro effectively cancels out the last con. Of course, there are some bad robots – there are bad variations of everything. But just because there are some bad shoes out there, you would not stop wearing shoes altogether, right? It’s the same thing with robots. Find a good one in the risk-free way we described, and then invest when you know that you will get positive results. What’s not to like about that?
Con 2: You will not learn technical analysis
This might be obvious, but we have to point it out anyway. When you use an automatic trading system, you will not learn how to trade yourself. This is alright with most traders – they only want the money. But if you want to become a professional trader or want to master market analysis for some other reason, a robot will be unable to help you with this task. That doesn’t mean that you should not get a robot if one of these conditions applies to you – why wouldn’t you take the money? – but it means that you should build your learning program around other tools.
Pro 3: A robot can help you to trade without investing any time
As you have seen from our example, a robot can make you a lot of money. Even if you adjust your investment per trade only once a year, you will be able to increase your account balance significantly.
This means that you have to invest almost no time. Once you have set up your system, you can almost forget about it. And while the setup process requires some time for testing different robots and brokers, you only have to do it once and can profit from it for years.
Good binary options robots win at least around 70 percent of their trades and get average payouts of around 70 percent. Depending on how much risk you are willing to take and which percentage of your overall account balance you are willing to invest per trade, you can double to quadruple your money every year if your system achieves these results.