Binary Options Trading
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Learn how to trade binary options, keep up with the latest market news, and find the best offers and no deposit bonuses online. Our editors have provided a variety of guides and resources to help you make the most money online.
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What are Binary Options?
Binary Betting is a form of betting on the financial markets where the price of the bet is displayed as an index between 0 and 100. If the event which is being bet on happens, the bet is settled at 100, if it does not happen the bet will finish at 0.
The Binary Betting Broker will quote a price on the event and if the bettor thinks it will happen they will buy the bet, if they don’t think it will happen they will sell the bet.
The best way to explain this form of financial betting is to give an example of one of the most basic forms of binary betting and that is an ‘Up or Down’ Bet.
Imagine the scenario, it is 3.30 pm and the FTSE is currently standing at 5400. The market closed yesterday at 5425 and the broker that you are using is quoting the binary ‘FTSE to Finish Up’ price at 24 – 26.
In your opinion you believe that the FTSE will start to rise towards the closing stages of the day’s trading so you decide to buy the ‘FTSE to Finish Up’ binary at £20 per point at the price quoted of 26. In this instance your judgement proved to be correct as the FTSE finished at 5450 so you win £1480 (100 – 26) = 74 x20.
As long at the FTSE finished up the bet will be settled at 100, if it had not gone up your bet would have been settled at 0. So, if the FTSE had not gone up by the close of business on that particular day you would have lost £520. That is calculated by multiplying the price which is 26 by the stake which is £20.
Before you make a binary bet you will know exactly the maximum amount that you can lose which in this example is £520.
There are various other types of binary bet and the same principles apply to each, you are asked a question and the answer will either be right or wrong.
One Touch
A one touch binary bet is if the underlying market will go through a set price before the expiry of the trade. If the market does go through this set price it will be settled at 100, of not the bet will be settled at 0.
Ladder
The Ladder binary bet is decided on whether the market will end the period of the trade above a certain level. For example a ‘Wall Street to be above 12200 level’ bet will be settled at 100 if the market finishes above that figure or 0 if it finishes below it.
Target
A Binary target bet is whether a particular market will end the trading period within a particular price range. As an example, Wall Street to Finish Up 20 – 40 would settle at 100 if the market finished the trading period between those two figures and would settle at 0 if it didn’t.
Hi Lo
This type of Binary bet is simply if the high or low of an underlying market in a trading day will be a set distance from the high or low of the previous days trading.
Tunnel
This kind of Binary bet is whether the underlying market will trade between two barriers which are stated before the bet is made. The Tunnel bet might be that the FTSE will trade between +50 and -50 during the course of the trading day. If the market hits any of these levels throughout the day the bet will be settled at 0, if it doesn’t touch any of these levels it will be settled at 100.
Binary Options Brokers
When it comes to placing Binary Bets the crème de la crème of the Binary Betting brokers just has to be IGIndex. The betting interface is extremely straightforward to use and it is easy to see at any given time what the exact position of your Binary Bet is. Just as is the case with financial spread betting, IGIndex really does take some beating.
