Tag Archives: volatility

volatility

Why Planning Is The Most Crucial Step In Binary Options Trading?

Market volatility is something that has constantly been on the rise for the past couple of years. This is the reason why more and more investors have shifted from investing in the stock market where risk and returns are variable to investing in the binary options market where both the risk and the return associated […]

By binbet.com | Planning | binary options strategies, money management, position, risk management, trading strategies, volatility | 0 Comments | 1

… But What’s a Binary Option?

A binary option is a type of option where the payoff is either some fixed amount of some asset or nothing at all. The two main types of binary options are the cash-or-nothing binary option and the asset-or-nothing binary option. The cash-or-nothing binary option pays some fixed amount of cash if the option expires in-the-money while the asset-or-nothing pays the value of the underlying security. The options are binary in nature because there are only two possible outcomes. They are also called all-or-nothing options, digital options (more common in forex/interest rate markets), and Fixed Return Options (FROs) (on the American Stock Exchange). Binary options are usually European-style options.

For example, a purchase is made of a binary cash-or-nothing call option on XYZ Corp's stock struck at $100 with a binary payoff of $1000. Then, if at the future maturity date, the stock is trading at or above $100, $1000 is received. If its stock is trading below $100, nothing is received.

Lost Your Password?

Tag Archives: volatility

Why Planning Is The Most Crucial Step In Binary Options Trading?