Binary options, also known as Fixed Return Options (FROs) or “digital options”, are financial instruments that feature a prediction regarding the future price of a certain asset. A trader does not actually purchase the asset; he only predicts the market/asset direction. If the asset price at the time of expiration correlates with the trader’s prediction, he is entitled to a predefined pay out.
Binary option trading represent a short term investment and are traded in private markets and over the counter. As the outcome of a prediction is usually determined at the end of the day or even during the day, binary options can provide high returns in a very short time.
Binary options make trading in the financial markets very simple. Choose an asset, make a prediction whether the asset’s price at expiration time will be above or below its current price, enter the invest amount and that’s it! Then wait for the asset’s expiration time to see if your prediction was correct. High pay outs are offered when the trader is correct and small amount of the investment can even be returned if the prediction was incorrect. Those pay outs and return amounts are published specifically for each option offered, be sure to check them carefully.
There are only two numbers taken into account:
1) The strike price (The market price when you entered the position)
2) The expiry price (The market price when your position expired)
Benefits of trading Binary Options.
Tax free returns
All profits are yours to keep
High fixed returns on trades up to 80%
Limit your risk
Know your potential profit and loss up front
More opportunities to Trade
Take position in a flat and volatile market
Potential for quick results
Timescales range from 60 seconds to monthly
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