Binary options are also called fixed return options or digital options. This is a trading option that provides a financial instrument with fixed odds so individuals may bet on how an asset will move. To put it simply, binary options trading involves a simple yes or no answer: Will an asset be above a specific price at a certain time? When it comes to trading, binary options are one of the easiest financial assets to start with.
Since binary options trading is fairly simple it appeals to many traders and newcomers in the financial markets. However, even though the process is fairly simple, someone that is interested in binary options trading should understand fully how it works, the markets and the time frames that allow binary options trading, as well as the advantages and disadvantages of the products and the companies that are legally allowed to provide binary options to residents in the United States.
Types of Binary Options
There are several different types of binary options available. There is short term trading available from as little as sixty seconds, you can also trade in a given range and set the expiry for yourself. With this many options available, trading binary options truly provides you with a chance to fully optimize your trading. You can choose the option that is best suited for your particular trading strategy.
High/Low: the high low option allows you to predict where the market is going to be at the expiry when compared to the current price. If you are correct you may earn up to 100% profit for the trade. There is also a range high/low option where you can choose whether the market will go up or down in a certain range above the current price. A correct prediction will earn 100% profit. The spread high/low option allows you to choose whether the price is going to be above or below an offered price at expiry. The offered price is different based on the quoted market price by the spread value. This is comparable to a spread found on the traditional Forex market. The profit for being correct is 100%.
Quick Options: this provides you with an expiry time within just two minutes. You will need to determine if the market is going to be up, which is a call or down which is called a put, at the expiry. If you are right it is possible to double your investment very quickly.
One Touch: this option allows you to choose whether you want to have a boundary placed at an above price level above or below what the current price is. If the market price makes it to the boundary level before the expiry you may earn up to 100% profit for your trade.
These are just a few of the ways to trade binary options. Many people prefer this form of trading because it provides them with a chance to make money in a short amount of time and the entire process is quite simple.