Binary options
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A binary option is a digital contract based on the expected direction of the asset price in a selected period of time.
The goal is to decide if an asset price will rise or fall. There are a few ways this is done:
- Traditional: when it is necessary to determine the condition of the future direction: the rise or fall in the asset value within a time period starting from 5 minutes.
- Barrier: Deciding if the price will reach a certain point.
- Level: When you need to predict if the price will go past a certain point while the trade is open. The percentage of profit depends on how far it goes past the buy price.
- Turbo: Short-term binary options, most commonly known as 60-second options.
There are two mainconditions in Binary options – Call and Put. When buying a Call contract (UP), a trader expects that the price of the underlying asset will rise relative to the price at the buying time. When buying a Put option (DOWN), a trader, on the contrary, expects that the price of the underlying asset will fall relative to the price at the end of the option period.
Insider Tip: Binary options are tricky! Even experienced traders can make the wrong choice and lose money on binary options. There are some who consider them their secret to success, while others see them as too risky.
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