How much does a binary options signal cost
Binary option signals can have very different prices but most signals cost between USD95 and USD250. Most signal providers charge a monthly fee but there are a few providers that choose to charge a one time fee instead. There are also a small number of free signal providers.
Free and cheap signals seldom keep the same quality as more expensive signals. We recommend that you choose a provider that charge a monthly fee and have a high success rate. Do not pay too much attention to the price of the feed. The price is not important if the feed provide you with high quality signals that earn you money each month.
We do not recommend that you subscribe to signals where you only pay a one time fee to get access to the signals. The signals they provide might hold a high quality right now but they have less motivation to keep the quality up than a provider who charge a monthly fee. A signal provider that only charges a one time fee already got your money. All they lose if the quality drops is the potential future income from new subscribers. A signal provider that charges a monthly fee will loose all future payments from you and all other clients if they let the quality of their signals drop.
Another benefit with signal providers that charge a monthly fee is that they have a steady stream of income and can therefore always buy the tools, equipment and software they need to keep producing high quality signals.
When you are looking at different binary signals you should ignore the price the provider charge and instead calculate the potential value that the signal service offers you. The value of the service is the amount of money you can earn from trading using the signals. Calculating how much money you can make is easy to do on your computer or a piece of paper.
Calculating the value of a signal service
There are a number of things you need to know to be able to calculate the value of a signal service. They are:
- How many signals the provider send out each month (Average).
- What success rate (win rate) the provider have had in the past. If their success rate is listed as a span (ie 71-76%) than you should use the number in the middle of that span to calculate the value. You can use the lower number if you want to calculate a worst case value and the highest number if you want to be optimistic in your valuation.
- How much you want to invest on each signal. It should always be the same amount.
- How much your broker pay you when a option matures in the money.
With this information you can calculate the value of a signal service.
Let us calculate the value of a signal service using this example:
- The signal provider sends an average of 150 signals each month.
- The success rate of the provider is 70%
- You invest USD100 on each alert
- The broker has a 80% return on options that matures in the money. This means that you will earn USD 80 on every option that ends in the money. (100*80%)
Now that we know this information we can postulate that.
- You will make 150 trades during the month.
- 105 of this trades will mature in the money. (150*0.7). These trades will earn you a combined profit of USD8400 (80*105)
- 45 of the trades will mature outside the money. These trades will lose you USD4500 (45*100
- Your end result for the month would be 8400 (in the money) – 4500 (outside the money) = 3900. You would earn USD3900 a month trading the signal from this provider.
If you look at the fact that a signal subscription can earn you USD3900 a month then it is very easy to see why it doesn’t matter if a signal service cost USD100, USD200 or USD300 a month. The only thing that matter is that the quality of the signal is high so that you can earn a lot of money trading on the signals.
The Price of different types of signals
The price of binary options signals will vary a lot depending on what type of signal you want. Below you will get some examples of the average cost of common types of signals. The price of individual signal can be higher or lower than the examples I list below. Remember to look for the provider that offer you the best value for your money regardless of the price.
Simple Signals
Simple signals are the most common type of binary option signals. These signal focus on simple call/put options and provide you with the basic information you need to make a trade but they usually do not contain much background data to show you what triggered the signal. They only tell you what to buy and when. These signals are perfect for traders who want to make money on the binary option market without actually having to learn how to read and analyze the market themselves. This group include most traders when they first get started. Simple signals usually cost around USD100. It is very common to see simple signal services that are priced just below the psychological important USD100 line.
Complex signals
Complex signals does not tell you what to buy. They will make a prediction about the future value of an asset and will then let you decide what you want to buy. A complex signal might tell you that the currency pair USD/YEN will trade at x.xxxx at 11 am. You can then decide which binary options you want to buy. Complex signals gives you a lot more options in regards to what options you want to buy. You can use these signal to trade both traditional and more exotic types of binary options. They can therefore be a lot more profitable then simple signals. Complex signals are usually more expensive than simple signals and the average prize of this type of signals are around USD250.
Live feed signals
Live feed signals are signals where you get access to a live stream where you can see the traders working to find good opportunities. When they find a good opportunity they will manually send you a signal alert. These signal are a very good choice for all traders who want to learn more about how to trade successfully. Watching professional trades can allow you learn a lot faster and dramatically cut the time it takes for you to become a skilled experienced trader. This is especially true if you sit by your computer and work with the traders on the feed by mimicking them. Live feed signals can vary a lot in price but most signals cost around USD250 a month.