how binary option company make money

What are binary options

A binary option is a type of option with a stock-still payout in which you predict the outcome from two possible results. If your prediction is correct, you receive the agreed payout. If not, y'all lose your initial stake, and cypher more. It's called 'binary' considering at that place can be but two outcomes – win or lose.

Advantages of binary options trading

Aside from the simplicity of its 'yes or no' proposition, binary options trading is also very flexible. It gives y'all the power to trade:

• All markets

  Trade on underlying markets that include forex, stock indices, commodities, and more.

• All market weather condition

  Predict market movement using upwardly/down, touch/no impact, and in/out trade types.

• All durations

  Have a short-term or long-term view with trade durations from 10 seconds to 365 days.

• All payouts

  Earn payouts up to 50,000 USD. Losses are express to your initial stake and nada more.

Why you lot should trade binary options with Binary.com

Savour an honour-winning online trading platform with trading weather that are platonic for new and experienced traders.

Award-winning online trading platform

• Simple and intuitive
  Savour a trading platform that's piece of cake to navigate and utilise.
• Instant access
  Open an account and start trading in minutes.
• Available 24/vii
  Merchandise when yous desire. Our Constructed Indices are bachelor even on weekends.
• Patented technology
  Merchandise with the industry pioneer and holder of a patented pricing applied science.
• Security and privacy
  Trade confidently, knowing that your personal data, transactions, and funds are e'er secure.

All conditions and durations

• All markets and weather condition
  Trade currencies, stock indices, commodities and more than in rise, falling, sideways, serenity, and volatile markets.
• Brusk to long-term durations
  Choose timeframes from x seconds to 365 days.

Competitive and transparent pricing

• Sharp, benchmarked prices
  Receive prices that are benchmarked against interbank rates.
• Transparent risk and potential advantage
  Know how much you volition win or lose before you purchase the contract.
• Protect your profits
  Sell your long-term contracts before expiry to protect whatever profits y'all may have fabricated or to minimise your losses.
• Two-fashion pricing
  Receive quotes for a merchandise and countertrade, then you always get unbiased, transparent rates.

Ideal for new and experienced traders

• Low minimum stakes
  Deposit as picayune as 5 USD to showtime trading.
• Trade according to your preferred strategy
  Trade based on "gut feel" or rely on technical and fundamental analysis.
• Flexible
  Choose from over one one thousand thousand possible merchandise variations at whatever fourth dimension, and customise your trades according to your preferred strategy.
• Scalable
  Earn the same proportional return on stakes of all values.

How to trade binary options

Binary options trading is relatively easy. You can buy a contract in but iii steps:

1

Define your position

Choose the market, trade type, duration, bulwark, and payout.

two

Go your toll

Receive instant prices based on your position.

3

Make your trade

Purchase the contract or re-ascertain your position.

Step ane: Ascertain your position

The first step is to fix the parameters of your merchandise. There are five trade parameters you need to adjust in order to receive a price for the contract:

Choose from four bachelor markets:

• Forex
  Major and modest pairs, plus Smart FX indices
• Stock Indices
  All major worldwide stock indices sourced from the over-the-counter market
• Bolt
  Major commodities such as gold, argent, and oil
• Synthetic Indices
  Our proprietary synthetic indices that simulate market forces

Cull from three main merchandise types:

• Upwards/Down
  Predict if the market will rise or fall from its current level, or if it volition end higher or lower than a price target.
• Bear on/No touch
  Predict if the marketplace will touch or not touch a toll target.
• In/Out
  Predict if the market will stay betwixt or go outside ii price targets.

Aside from the three main trade types to a higher place, yous too get Asians and Digits trade types exclusively with our Constructed Indices.

Set the length of your merchandise from 10 seconds to 365 days, whether you have a short-term or long-term view of the markets.

Set bulwark(s) to define your position and trigger the payout you'll receive.

Choose the payout y'all wish to receive from correctly predicting this contract.

Step 2: Get your cost

The cost of the contract is automatically calculated by our patented pricing technology based on the parameters you've divers in Step 1. Our prices are benchmarked against the interbank options market, so you always become the well-nigh competitive prices. This means that you'll always receive fair and transparent pricing, whatever your position.

Step 3: Make your trade

When you are satisfied with the price that yous receive, execute your merchandise immediately. With our unique platform, there's no risk of 'slippage' or gaping markets. And most importantly, there are no subconscious fees. You tin can also sell dorsum whatsoever long-term trades at whatever time to turn a profit from favourable market conditions.

Types of trades

Binary.com offers the following merchandise types that will help you lot execute your market view or strategy:

Up/Down

There are two types of Up/Down trades:

• Rise/Fall
  Predict that the market volition rise or fall from its current level.
• Higher/Lower
  Predict that the market volition end college or lower than a price target.

Touch/No bear on

Predict that the marketplace will impact or not touch a target whatsoever time during the contract catamenia.

In/Out

At that place are two types of In/Out trades:

• Ends Between/Ends Outside
  Predict that the market stops inside or outside 2 price targets at the end of the fourth dimension menses.
• Stays Between/Goes Outside
  Predict that the market stays inside or goes outside two toll targets any time during the contract period.

Asians

Predict that the marketplace will end higher or lower than the boilerplate price.

Digits

Predict the concluding decimal digit of the spot price with Digits. There are three types of Digits trades:

• Matches/Differs
  Predict that the last digit will match or non lucifer.
• Even/Odd
  Predict that the last digit is an even number or odd number afterwards the last tick.
• Over/Under
  Predict that the final digit is college or lower.

Reset Call/Reset Put

There are two types of reset trades:

• Reset Telephone call
  Predict that the market will end upwardly higher than either the current level or the level at a predetermined time (reset time).
• Reset Put
  Predict that the market volition end upwardly lower than either the current level or the level at a predetermined fourth dimension (reset time).

At reset fourth dimension, if the spot is in the opposite direction of your prediction, the bulwark is reset to that spot.

High Ticks/Low Ticks

Buy High Tick/Low Tick contracts to predict the highest or lowest tick among the adjacent five ticks.

Only Ups/Only Downs

Bachelor trade types:

• Only Ups
  Win payout if sequent ticks rising successively. Contract is lost when at to the lowest degree one tick falls or is equal to any of the previous ticks.
• Only Downs
  Win payout if consecutive ticks fall successively. Contract is lost when at least one tick rises or is equal to any of the previous ticks.

Please note that Asians, Digits, Reset Call/Reset Put, Loftier Ticks/Low Ticks, and Only Ups/Only Downs are available exclusively with our Synthetic Indices.

Range of markets

Binary options let yous to trade on a wide range of underlying markets. One of the advantages of trading binary options is that you lot are not buying or selling an actual nugget, only a contract that determines how that asset performs over a period of time. This limits your run a risk and makes it like shooting fish in a barrel for anyone to outset trading.

Available markets

Forex

Major pairs, modest pairs, and Smart FX indices.

Stock Indices

Major worldwide stock indices sourced from the OTC marketplace.

Commodities

All iv precious metals, plus energy.

Constructed Indices

Constructed indices that mimic market volatility.

Forex

Trade pop major and minor currency pairs, plus Smart FX indices – weighted indices that mensurate the value of a currency against a basket of major currencies.

There are 4 types of Smart FX indices that you tin merchandise:

• AUD Index – Measures the value of the Australian dollar against a basket of five global currencies (USD, EUR, GBP, JPY, CAD), each weighted past 20%
• EUR Index – Measures the value of the Euro against a handbasket of v global currencies (USD, AUD, GBP, JPY, CAD), each weighted by 20%
• GBP Alphabetize – Measures the value of the British Pound confronting a handbasket of 5 global currencies (USD, EUR, AUD, JPY, CAD), each weighted by twenty%
• USD Index – Measures the value of the Us dollar against a basket of five global currencies (EUR, GBP, JPY, CAD, AUD), each weighted by xx%

Stock Indices

Bask exciting opportunities to merchandise stock indices with the benefit of real-time charts and pricing.

Our stock indices are sourced from the over-the-counter (OTC) market – sources outside of the centralised exchanges. Please note that due to their OTC nature, the prices of our stock indices may differ from their counterparts on centralised exchanges.

Bolt

Nosotros offer all iv precious metals – gold, silvery, palladium, and platinum – as well as energy in our list of commodities.

Synthetic Indices

Binary.com'south Synthetic Indices are synthetic indices that mimic real-globe market place volatility and are available for trading 24/7. They are based on a cryptographically secure random number generator audited for fairness by an independent third party.

Synthetic Indices give you sectional access to various merchandise types, such as Up/Downward, Touch on/No Touch, In/Out, Asians, Digits, Lookbacks, Reset Call/Reset Put, Call Spread/Put Spread, Simply Ups/Only Downs, and more than.

Synthetic Indices are further categorised into 2 classes:

• Continuous Indices – Choose from the Volatility 10 (1s) Index, Volatility 25 (1s) Index, Volatility fifty (1s) Index, Volatility 75 (1s) Alphabetize, Volatility 100 (1s) Index, Volatility 10 Index, Volatility 25 Alphabetize, Volatility 50 Index, Volatility 75 Index, and Volatility 100 Alphabetize. These indices correspond to false markets with constant volatilities of x%, 25%, l%, 75%, and 100% respectively.
• Daily Reset Indices – Daily Reset Indices replicate markets with a bullish and surly trend with a abiding volatility. The Bull Market place and Deport Market indices commencement at 00:00 GMT each day, replicating bullish and surly markets respectively.

Glossary

Bulwark(s)

The barrier of a binary choice trade is the price target you set for the underlying. You can cull trades that stay beneath or go above a price target, or stay betwixt 2 targets.

Binary pick

A binary option is a contract purchased past a trader, which pays a pre-determined amount if their prediction is correct.

Commodities

Commodities are resources that are grown or extracted from the ground, such as silverish, gilded and oil. On Binary.com, they are priced in Usa dollars.

Contract period

The contract period is the timeframe of a merchandise. Information technology is also called the duration.

Derivative

A derivative is a financial musical instrument whose value is determined past reference to an underlying market. Derivatives are commonly traded in the inter-bank market, and binaries are one of the simplest forms of derivatives.

Elapsing

The duration is the length of a purchased trade (run into 'contract period').

Ends Between/Ends Outside trades

An Ends Between trade pays out if the market exit price is strictly college than the depression price target AND strictly lower than the loftier price target. An Ends Outside binary pays out if the market go out cost is EITHER strictly higher than the loftier price target OR strictly lower than the low price target.

Entry spot price

The entry spot cost is the starting price of the trade purchased by a trader.

Expiry price

The expiry price is the price of the underlying when the contract expires.

Forex

In strange exchange markets, traders tin can enter contracts based on the change in cost of one currency as it relates to another currency. For example if a trader selects Ascent in the EUR/USD market place, they are predicting that the value of the Euro will ascent in relation to the value of the US dollar.

GMT

GMT stands for Greenwich Mean Time, the official fourth dimension used in the UK during winter. In summertime, the UK changes to British Summertime Time, which is GMT + 1 hour. All times on the Binary.com site utilize GMT all year round.

College/Lower trades

These are trades where the trader predicts if a marketplace will finish higher or lower than a specified price target.

Stock Indices

Stock market indices measure the value of a option of companies in the stock marketplace.

In/Out trades

These are trades where the trader selects a low and high barrier, and predicts if the market place volition stay inside these barriers or go outside them (see also 'Stays Between/Goes Exterior trades').

Market exit toll

The marketplace exit price is the price in result at the end of the contract menses.

No Touch on trades

These are trades where the trader selects a price target, and predicts that the market will never bear upon the target before the death of the trade.

(1) Touch trades

These are trades where the trader selects a price target, and predicts that the market volition bear upon the target before the expiry of the merchandise.

Payout

The payout is the corporeality paid to an options trader if their prediction is correct.

Pip

Pip stands for 'percentage in point' which is generally the fourth decimal identify (i.e. 0.0001).

Profit

The turn a profit is the difference between the purchase price (the stake) and the payout on a winning trade.

Synthetic Indices

The synthetic indices simulate various real market situations and provide an ideal platform for getting used to trading and testing strategies nether various marketplace conditions. These indices depend on volatility and drift, and help users to endeavor out scenarios like - loftier volatility, low volatility, bullish and bearish trends.

Resale toll

The resale price indicates a contract's current market toll. Resale prices are on a all-time-efforts footing and may not be available at all times subsequently purchase. See 'Sell option' for more than details on selling contracts earlier death.

Return

The return is the coin realized when the contract expires (see 'Payout').

Rise/Autumn trades

These are trades where the trader predicts if a market will rise or fall at the terminate of a selected time period.

Sell option

It is sometimes possible to sell an selection earlier the expiry of a trade, but only if a fair price can be determined. If this choice is available, y'all will encounter a 'Sell' push button within the popup window, after clicking on the 'View' push side by side to your trade in the portfolio.

Spot toll

This is the current price at which an underlying tin can be bought or sold at a particular time.

Stake

The stake is the amount that a trader must pay to enter into a trade.

Stays Between/Goes Outside trades

A Stays Between trade pays out if the market stays between (does not bear on) BOTH the high barrier or the low bulwark at any time during the period called by a trader. A Goes Outside trade pays out if the marketplace touches EITHER the high barrier or the low barrier at any time during the menstruum chosen by a trader.

Tick

A tick is the minimum upwards or downward movement in the price of a marketplace.

Underlying

Each binary option is a prediction on the future motion of an underlying market.

Source: https://www.binary.com/en/get-started/binary-options.html

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