What are Binary Options?
It is now possible to trade on multiple global markets and this is possible because of Binary Options. This is controversial and one of the highly misunderstood financial instruments.
So, let us check out the exact details about Binary Options. This trading platform is featured with a different range of payouts and fees and also risk and returns.
Furthermore, it is surrounded by a unique kind of liquidity structure as well as a unique investment process. Rest of the details is mentioned below:
All about Binary Options
It is quite and relatively simple to understand about this trading platform. This platform has become one of the popular choices among a large number of low skilled traders.
Moreover, you trade in stocks and indices. The person can trade in commodities and too in foreign exchange. All of these options come with a clear and accurately stated expiration date, stock price and time.
Furthermore, traders buy a call option when the stock situation is bullish.
On the other hand, they buy a put option when the situation and market condition is bearish. Most importantly, for a Call option, you have to trade right above the strike price.
However, for a Put option, traders need to trade exactly below the strike price. And if you are trading with non U.S binary options, then you will always have a fix payout and also fix risk.
These binary options are mainly and generally offered by the individual brokers.
High and Low Binary Options
Most importantly, these binary options are specifically available for extensive range of time frames. As an example, you can have these binary options from minutes time frame to months duration.
It is up to you what expiration date and time you want to choose and go for.
If you plan to buy the option which expires right after 30 minutes, then your payout will be 70% plus if your original stake is above 1800 S&P 500 index.
One Touch Option and Range Option In the World of Binary Options
You might be wondering what is this One Touch Option? We will tell you! Here, your traded instrument should be able to touch the strike price for one time only before it reaches to its expiration phase. Moreover, there is a target specification hint exactly above and below scale of the current price. With the help of this specification, you can easily pick what target suits.
On the other hand, a range binary option let traders to choose a price range for their asset which they are going to trade withing the duration of its expiration. Hence, the user will get the payout if the asset price stays and remains within that range limit. And you may lose the investment if the price goes and move out of range.
Massive Competition Revolving Around Binary Options
No doubt, competition is extremely heating up when it comes to binary options trading category. For the reason that a large number of brokers are offering and giving out additional products and also bonuses to their clients.
They boast and brag to give a payout range of 50% to 500%. Hence, in this trading category, product structures and product requirements keep on getting changed.
And also risk and rewards keep on changing.
Positive and Negative Side of Binary Options
While pursuing this trading, you can either win a fix amount or lose a fix amount. No fees and commissions are involved in it. You get to know about rewards and risks in advance.
Moreover, you can conveniently know which asset is going up and which one is going down. The user does not have to experience any of the liquidity concerns.
The negative side of this trading platform is that you will always get fewer rewards as compared to the profit percentage.
Upon losing trades, it will cost you more as compared to the fact of winning trades.
Conclusion
If you still have any questions about binary options, then let us know. We will try out level best to answer all your questions about this trading category.