Investors banking on purchasing shares or index certificates have an eye for Asia for a long time now. Both in the short term and the long term, this area has the best chances of a sustainable economic growth which also may have a sustainable effect on the stock exchange value. But for completely various reasons, there are consistently throwbacks that cannot be traced back to data from the economic sector. That is why also for binary options traders aiming to specialise on Asian markets there is the excellent chance of high returns.
Positive development on many stock exchanges of the region in the offing
In general, the development on Asian stock exchanges was relatively retained in 2012.
A glance on the CSI 300-index for Chinese markets shows this clearly; for more than twelve months it remained on the same level, but there were relative high upward and downward amplitudes. Though the Hang Seng Index in Hong Kong increased by about 15 percent between the beginning of 2012 and today but the course was not consistent at all either.
Altogether, many analysts consider the development in 2012 especially in China, but also in the whole Asian region, as way too pessimistic. Within the next months, the Chinese economy will most likely increase a bit again. This is not only good news for China. The other national economies in the Asian region as well that largely depend on China’s development may go along with it. This applies for markets such as Thailand, Indonesia, Singapore and South Korea.
Negative events are able to have a great impact for a short time
Those trading with binary options of course do not only profit from increasing exchange rates. Decreasing exchange rates of shares or indices as well offer the opportunity of getting a high return by predicting correctly. That is why taking Asia into consideration pays off twice. Despite of the good growth prospect of this region, the developments on the share markets have been affected by a relatively high volatility over the past few years. Both political developments and natural catastrophes or other events can have a negative effect on the exchange rates for a short time.
A good example was the devastating earthquake in front of the coast of Japan where the damage was highly increased by a subsequent tsunami. Since Asia is geographically located in a very active region such events can occur consistently and they may have a strong impact on the economy of one or more countries for a short time.
While natural catastrophes are not predictable and require a fast reaction from the traders, political events may also have a great impact on the markets. Compared to Europe, the regional cooperation in Asia is still relatively less marked. In contrast, there are great rivalries between many nations. For this reason, over the past few years, there have consistently been protests in China, South Korea and Japan whose effects were also notable on the markets. So, those who choose indices from the Asian region as their underlying assets for binary options should also keep an eye on political developments.