Introduction of Binary Options /// Binary Options Available Markets /// Explanation ABOVE/BELOW

HOW TO TRADE BINARY OPTIONS

WHAT ARE BINARY OPTIONS?

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A binary option, also referred to as a digital option, has only two possible outcomes each of which pays out a fixed return depending upon whether a certain condition is fulfilled by the time the option expires. For example, a binary option that has percent payout of 75/10 means that, with an initial investment of U.S.$100, the customer will receive $175 if the condition is met (and the option expires in-the-money) and $10 if the condition is not met (and the option expires out-of-the-money). In the latter case, the net cost to the customer is $90.
Binary options are a novel type of investment vehicle that are rapidly becoming a favorite among beginning investors because they have limited risk and are simple to understand. Binary options typically expire in an hour, giving you the opportunity to earn a high return over a very short time period.
 
WHY TRADE BINARY OPTIONS?  

Binary option trading has several unique advantages. The payout and risk of a binary option are known in advance and are fixed. The full payout is received even if prices settle just a little in the trader's favor. When trading binary options, there is no margin required and no risk of losing more than the amount initially invested. Binary options cash settle at expiration so there is no need to manually close a position. Finally, a customer can invest in a binary option for as little as U.S.$50 allowing the beginner to trade with the thrill of actual money while risking very little.
 
HOW ARE BINARY OPTIONS TRADED?

Retail binary options are traded live on an online (web-based) electronic platform. Prices and charts are displayed in real time allowing the trader to see the price action on a tick-by-tick basis. Purchasing a binary call or put option is done with the simple click of a mouse. The trading platform displays a settlement price at the option's expiration and income (if any) from expiring options is deposited automatically into the trader's account.
When trading binary options, you should make sure that the platform is registered and regulated.
 
ABOVE/BELOW BINARY OPTIONS
Max Return: Up to 85%

The most popular type is the above/below or high/low binary option and trading is fairly straight forward:

If you feel that prices will rise, then invest in a binary call option.
If you feel that prices will fall, then invest in a binary put option.

If you choose correctly, then you'll receive back your initial investment plus a return of as much as 85% of the investment, depending upon the market being traded. If not, then the most that you will lose is your initial investment. Better still, in some cases a small part of your initial investment in a losing trade may even be returned to you. For example, say that you invest $100 in a above/below binary call option on Google with payout of 75/10. The price of Google at the time you buy the option is $544.67 per share. When this binary call option expires, if the price of Google is above this price, then you'll receive $175. If below, then you'll receive $10, meaning that the net loss will be $90.



 

What are Binary Options? Binary options are just like regular options except:
	They last only one hour. Designed for short-term trading.
	Fixed payout if the option finishes in the money or not.
	Option need only finish one tick in the money to earn the payout.
	You can invest as little as $50.
	Cash settle automatically at expiration.
	It's quick and easy to start trading.
	No commissions. No margin required.
	Trade and watch prices tick by on a regulated platform.

 
WHY IS TRADING BINARY OPTIONS SIMPLER?

A trading system for a typical asset needs to address three elements: when to get into a trade, either long or short; how much to risk on the trade; and when to close the trade, either at a profit or at a loss. Determining each is a challenge and all three elements must be correctly balanced to achieve profitable trading performance.
Binary options, though, require a less complicated system. With a binary option purchase, the most that you can lose is the investment amount and this can be as low as $50 so the risk is automatically controlled. Binary options expire within an hour and cannot be sold prior to expiration so there is no decision to make over closing the position. The trading system of a binary option reduces to the single decision of deciding when to get into a trade, either long (by buying a call option) or short (by buying a put option).
 
BINARY OPTION MARKETS AVAILABLE

Currencies:
EUR/USD, USD/JPY, GBP/USD, USD/CHF, GBP/JPY, AUD/USD, EUR/GBP, EUR/JPY
Commodities:
Crude Oil, Gold and, during the U.S. trading day, Natural Gas, Copper and Silver. All are based on the nearby futures contract traded on CME Group.
Stocks and Indices:
During the Asian trading day: BHP Billiton, Commonwealth Bank, CSL, Macquarie Group, Newcrest Mining, Rio Tinto and the S&P/ASX 200 index.
During the European trading day: Barclays, BP, RBS, HSBC, Lloyds, Tesco, Total, Sanofi-Aventis, BNP Paribas, AXA and the FTSE 100 and CAC 40 indices.
During the U.S. trading day: Mastercard, Macy's, General Electric, VM Ware, SPDR Gold Trust, Goldman Sachs Group, MGM Resorts, China Mobile, China Life, China Petroleum and the S&P 500® and NASDAQ indices.
 
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