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December 27, 2012 – 6:17 pm | One Comment | 5,869 views

Banc De Binary, which is headquartered in the City of London, is regarded by many experts as one of the most professional binary options trading brokers on the Internet. The company started operations following the …

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Introduction

Binary options have carved out a niche focusing on known risks, straightforwardness, and a de-emphasis on volatility.

Trading Basics

Once the options trader has registered his details online and completed his deposit, he is then ready for trading binary options.

Trading Strategies

The straddle is one of the best strategies in binary options trading. The trader is looking to place a Put as high as possible.

Risk Management

One of the most important considerations for any trader is how to manage risk as loss is always a possibility in trading.

Fundamental Analysis

Fundamental analysis looks at how outside influences like natural events can affect prices and serves as essential tool.

Home » Trading Basics

What are Digital Binary Options?

Submitted by on November 24, 2012 – 4:06 pmNo Comment | 1,997 views

These are the simplest and most common trades and are sometimes known as all-or nothing options. As described already, the trader is simply predicting whether the price will rise or fall by the stated expiration time.

For example,  Google’s shares have a current price of $535.50. The trader decides to buy an option that expires in two hours and pays a 75% return on success. He stakes $100 on his prediction and, at the end of the two-hour period, the price stands lower at $534.10.

If he had purchased a Call option, he would lose and receive a percentage of his stake in return; if he had purchased a Put option he would profit and receive a return of $175, his original stake of $100 plus a 75% payout.

As explained previously, the incremental price movement itself does not matter as it does in traditional options trading. The trader must correctly predict whether the price will be higher or lower at the expiry of the contract – the price may move in either direction by as little as one pip.

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