Types of binary options – ForTrader.org financial magazine

We will continue to discover work with binary options… This time we will expand the knowledge base and delve a little more into the possibilities that binary options offer us.

Despite the seeming monotony of trading, the very structure of binary options work, similar to a betting deal, allows you to significantly diversify approaches and strategies. Well, indeed, if we can “bet” on the fact that a currency pair will reach a certain mark in 60 seconds, then why not bet that it will not reach? In this regard, binary options trading in practice has five main types. We will consider them.

View 1. Binary option “Cash or nothing” / “All or nothing”

This type of binary options is the most popular among traders. At the time of purchase, he has a certain percentage of profit and a price. It is this amount that is the volume of the transaction, and it is this amount that the trader risks. Until the moment of buying the “Cash or nothing” binar, it is required to make a prediction in advance about whether the selected asset will rise or fall, a Put / “Put” or Call / “Call” option is purchased, respectively.

If in the end, at the time of execution, the trader turns out to be right, then he receives a predetermined amount of profit, usually 70-85 %% plus the initial cost of the contract. If the forecast did not come true, then he loses the invested amount in full.

Sometimes companies make a return on loss of 10-15%, but this cannot be considered a rule, rather, it is just a bonus to raise the mood.

View 2. Binary option “Аsset or nothing”

Binary option “Аsset or nothing” practically does not differ from the above-described “All or nothing”. It can also be bought and sold by setting a certain level, above or below which the price will be at the time of execution, as well as receive the declared profit or lose the value of the contract. The only difference is in determining the profit, which is expressed in the value of the selected asset.

In fact, since profit is calculated automatically, many traders do not even see the difference between cash or nothing and Аsset or nothing binary options.

View 3. Binary options “One touch” / “One touch”

“One touch” on the strategy of execution and trading is significantly different from the previous ones. Having all the same cost and profitability, the contract also implies availability of a certain level of asset price… Knowing it, the trader must predict whether the price will reach this mark in the allotted period of time.

At the same time, it does not matter at all at what price the contract will be closed, the main thing is that asset touched a fixed level

View 4. Binary options “No touch” / “Inviolable”

The opposite in name and meaning for the “One touch” binary option is “No touch”. The only difference is the trader’s forecast about whether the price will reach the level specified in the contract. If he thinks he will not reach, then he should buy the “No touch” option. If at the time of closing the asset has not touched the level, then the trader receives the agreed profit. Otherwise, he loses the value of the contract.

View 5. Binary options “Double one touch” and “Double no touch” / “Double one touch” and “Twice untouchable”

These are the most complex and therefore the least popular types of binary options. In fact, this is a modified option “One touch” and “No touch” – the strategy and execution is identical. However, to achieve profit, two fixed levels are set, which the asset must reach or not touch until the expiration of the option expiration date.

Based on your own preferences, offers from binary options brokers, as well as the market situation, it is more profitable to trade different types of binary options. However, most traders prefer “Сash or nothing” as the most accessible and easy to understand.

Other articles about binary options

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