With most articles we publish here on the site we like to begin by providing background, history and information about the various assets you’re considering trading binary options on, but every now and again, circumstances present themselves in such a different way that they are impossible to ignore, and we feel that a change in presentation is in order.
Such is the case with the IBEX 35, which is the primary index representing the largest corporations in Spain, and is used most often to indicate the direction of the Spanish economy.
And indeed, it is nearly impossible to speak about the Spanish economy without starting at the end, or, to be more exact – the last few years.
To be completely honest, one cannot fault all of the blame that caused the near collapse (or total collapse as some would argue) on the government which was in power at the time, they may not have done much to stem the issues plaguing the economy, but they were given a plate which was already quite overflowing with hard to handle issues.
Poorly mismanaged finances were, without a doubt the reason for Spain’s collapse, housing prices rocketed in the years previous to the global financial crisis, but an extremely large trade deficit, shrinking GDP and fast rising unemployment rates all had a hand in turning Spain from a previously booming economy to a balloon that had imploded all at once.
To make a very long and somewhat complicated story just a little easier to swallow we’d like to skip ahead a few years, we’re confident you can get full details of just how bad things were in Spain, but the short of it is this: it may take a few more years, and be slower than Spanish people may prefer, but it would seem the Spanish economy is making short confident strides towards recovery, but as a trader of binary options that isn’t why you’re here, you want to know the possible profitability of any investment in IBEX 35.
If we were speaking a couple of years ago, the answer may have well been to try and avoid it, we are aware that some binary options traders prefer market instability as it allows for greater gains over a shorter period of time, which might well be true, and a very valid choice, but until the very end of 2013 and into 2014, the Spanish economy was such that it was beyond risk management territory and into complete financial uncertainty, which makes investment more a guess and less of a prediction.
However, over the last few months, the situation has somewhat stabilized and conditions seem to be slightly better for binary options traders.
As you may expect, when the market is unstable, the stock exchange and any index representing it will undergo similar instability, this was the case with the IBEX 35, but there are signs now showing the early forms of recovery.
The Ibex has been in a trend of general recovery that started in early 2013, not all months have been positive, but it is in an upwards trend, and has regained about 15% of its loses from the end of 2012 low of 8246 points and over 30% from record lows of 6108 points in mid-2008.
This data alone might not be enough to suggest that the market is in a permanent upward climb, but if taken in combination with the still tender volatility of the Spanish market, which has been making strides to recovery, but is still under a great deal of pressure to continue reforms, we have a recipe for great profits – market movements + great volatility + economic pressure = profits for binary options traders.
So don’t be caught in your own nationwide slump, make your road to recovery by trading IBEX 35 binary options now!