In the world of finance you likely hear about the concept of 'options' all the time. You hear about forex options and stock
options but you may not have heard about binary options.
Binary options are a bit different from standard options simply because
they are not quite as flexible. When you are dealing with binary
options you are dealing with a payoff that is a fixed amount.
If your payoff is not that particular amount then you will receive
nothing at all. In other words you have two types of binary
options: cash-or-nothing or asset-or-nothing. These are called
binary options simply because there are only two possible outcomes
similar to the binary language.
Binary options are becoming more and more popular simply because
they are a great way to make money. Essentially one will wager that
a security will close above or below a certain price. If this turns
out to be true, then a fixed payout is received. Typically if a
trader loses the wager they will receive a credit of 5-15% on their
original investment.
But why are these options so popular? What makes them so much
easier than your standard trading options and why should you choose
them? If you have ever attempted to trade on the forex or any other
type of exchange then you are probably quite aware as to how these
binary options can be beneficial to your efforts.
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