Binary Options Glossary. Binary Options Trading – Type of trading where you put money behind your prediction of future changes in a value of an asset in certain period of time. Broker – Trading platform that gives traders ability to trade with Binary Options. In The Money (ITM) – . Binary options are considered an ideal hedging product as the risk and payment are already known in advance. High/Low Option This is the most common form of binary options specifying whether the price of the underlying asset will rise or decrease within a predetermined time limit. USA REGULATION NOTICE: Please note if you are from the USA: some binary options companies are not regulated within the United States. These companies are not supervised, connected or affiliated with any of the regulatory agencies such as the Commodity Futures Trading Commission (CFTC), National Futures Association (NFA), Securities and Exchange.
Binary Options Glossary - Definitions Of Common Binary Options Terms
Below you can find an extensive Binary Options glossary with the binary options terminology that you will encounter regularly. Asset The instrument on which the trade is based. Binary options are traded based on currency pairs, stocks, binary options glossary, commodities and indices.
At The Money When the price at expiration equals its strike price, binary options glossary. Boundary or Range Option Instead of the usual call option or put option, you speculate that the price of the underlying binary options glossary will remain within a predetermined bandwidth. Call Option With a call option you speculate that the value of the underlying asset will increase. Commodities Commodities are raw materials used in the production of goods. Well-known commodities are gold, silver, palladium, oil, copper, grain, binary options glossary, cocoa etc.
Digital Option A digital option is another term for a binary option. Early Closure Early Closure is a possibility that some binary options brokers offer. With early closure you have the option to close your binary option before the original expiration time. Thus, you can decide to take a lower guaranteed profit or to reduce your loss.
Exotic Options Exotic options are simply more complex versions of binary options. These are used by major merchants before being made available to the public. Expiry Price The expiry price is the value of the underlying asset when the option expires.
Expiry Time or Expiration This is the date and time when a binary option expires. These can vary widely but the most common expiration times of binary options are often end of day, binary options glossary, one hour, 45m, 30m 15m, 10m, 5m and even 60 seconds. Forex Forex is just an abbreviated term for Foreign Exchange. The Foreign Exchange market is the second largest in the world binary options glossary involves all global currencies.
Fundamental Analysis Fundamental Analysis is used by many traders to estimate whether the rate of an asset will rise or fall. Examples of fundamental analysis are the analysis of macroeconomic figures, central bank and government decisions, growth rates, inflation figures, even the weather. Futures Futures are basically the same as options but often with longer contract duration and more flexibility when it comes to interim sales, binary options glossary.
Binary options are considered an ideal hedging product as the risk and payment are already known in advance. In-the-money In-the-money is a term used to describe when an investor achieves a profit. Instrument An instrument is another term used for an asset. Examples of assets are commodities, stocks, indices and currency pairs. Market Price The market price is the price that reflects the current value of an underlying asset, binary options glossary.
No Touch With a Binary options glossary Touch option, you speculate that the price of the underlying asset will not reach or exceed a predetermined price level during the term binary options glossary the option. Out-of-the-money If a trader is out-of-the-money, it means they have experienced a loss. One Touch With a One Touch option, one speculates whether the asset value will reach a predetermined price level before the option expires.
Payout The payout is the profit made when an option expires as expected and is in-the-money. Put Option Traders use a put option if they believe that the value of the underlying asset will expire at a lower price.
Range Option Instead of the usual call option or put option, binary options glossary speculate that the price of the underlying asset will remain within a predetermined bandwidth.
Refund The refund is how much money is returned to the investor if an option expires at-the-money. How much the refund is depends on binary options broker. Return A return is how much money is given to the investor if an option expires in-the-money. Strike Price This is the price at which the binary options broker is willing to sell the option. Target Price This is the same as the strike price, so the price against which the binary options broker is willing to sell the option.
Technical Analysis Technical Analysis involves studying patterns of market prices, binary options glossary. Touch Option With a Touch option, you speculate that the price of the underlying asset will reach a predetermined price level within the term of the option.
Underlying Asset The instrument on which the trade is based. Binary Options Glossary.
Binary Options - Options - The Fat Trader - Invest Glossary
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Finally, the Binary Options Glossary also refers to several trading strategies. For example, single asset strategy concentrates its attention on one asset while sitting on the fence strategy teaches you how to distribute your risks so as to minimize them. Go through the Binary Options Glossary carefully in . USA REGULATION NOTICE: Please note if you are from the USA: some binary options companies are not regulated within the United States. These companies are not supervised, connected or affiliated with any of the regulatory agencies such as the Commodity Futures Trading Commission (CFTC), National Futures Association (NFA), Securities and Exchange. Popular in trading experience in general, this glossary term refers to the entire (or a part of) amount of your investment you have returned to you in a situation when the binary option expires at the money. Return. The return amount is the amount that you earn right 4,4/5(7).
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