What Are Binary Options – FAQ

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What are binary options

Binary options are a great financial instrument and are a great way how to make money on the Internet. It is easy to understand, comprehend and trade.

Binary options are just one of many option types. They are characterized by their simplicity as the value of maximum profit or loss is known to both buyer and seller beforehand. Word „binary“ means that on expiration date buyer gets either predefined profit or nothing at all.

Binary options can be traded on regulated markets but are usually unregulated, traded on Internet and prone to fraud. For example, American Trade Commission issued warning to investors regarding binary options.

Binary option types

The most important factors for every binary option trade type are strike price and time for which the option is considered valid – called expiration time. Investor therefore speculates whether the price of an underlying asset (gold, silver or company stock) at the end of the expiration time (i.e. in 5 minutes or 2 hours) will be higher or lower than at the beginning of the trade.

Almost always this involves call and put binary options.

CALL Binary Option

In this case the trader speculates and hopes the price will rise.

Trader makes a call trade at 12:00 for 1 hour (with 60 minute expiration time at 13:00) with price $1.2 per stock. The trade amount is $100.

Only two possible outcomes:

  • At 13:00 the price is higher than $1.2 (i.e. $1.21 or $1.5) and the option expires IN THE MONEY. Thus the trader makes money. With returns of around 85 % trader could make $185 out of which $100 is the returned amount invested and $85 is pure profit.
    The price is lower than $1.2 (i.e. $1.19 or $0.9) and the trader loses money. The amount invested ($100) is therefore not returned.

PUT Binary Options

In this case the trader speculates on the oposite. That the asset‘s price will drop.

Example:
Trader makes put trade at 15:00 for 1 hour (option with 60 minute expiration time at 16:00) with price $1.2 per stock. The trade amount is $100.

Most Frequently Asked Binary Options Questions

If you have come across our website as you have an interest in Binary Options but do not fully understand how these financial instruments work and operate, then this section of our website will soon enable you to get an understanding of how they work and operate.

Below are the most commonly asked questions surrounding placing Binary Options trades online and once you have read them please do spend some time looking over any of our other Binary Options guides and articles as we have several of them available throughout our website which will help get you off to hopefully a flying start when you decide the time is right to start trading online!

    What are Binary Options?

Binary Options are a simple way for anyone to start making profits from stocks and shares without you having to actually purchase stocks and shares in any publically traded company. You will be given two options in regards to trading Binary Options and that will be to try and correctly predict whether the value of any company will increase in value or decrease in value over a given time period. Make the correct decision and you will make a profit however make an incorrect prediction and you will lose your investment. There are many benefits of investing in binary options online.
What Companies Can I Place Binary Options On?

You are able to place Binary Options on any publically traded company anywhere in the world, and as such you can choose from banking institutions, retailers and even place trades on whether the value of commodities or precious metals such as gold and silver will increase in value or decrease in value over any given time period.
Why Do Binary Options Brokers offer Bonuses?

One thing you are going to notice when you visit the website of any Binary Options Broker listed on this website is that each of them offer new traders a range of bonuses. These are given away as an incentive for you to sign up and to start to trade at those sites. The value of the bonus cash you can claim will vary from site to site and will also vary depending how much you deposit into your newly opened trading account, but there are some very generous ones of offer that are certainly worth checking out.
Do I need Specialist Knowledge of Share Trading?

The one main attraction of placing Binary Options online is that you will not need a great understanding of how stocks and shares operate nor will you have to be a technical wizard to be able to place your trades online. For when you sign up at any of our featured Binary Options Brokers you will find a very easy to use trading platform and you simply need to look up the company you are interested in placing a trade on and then choose whether you think the share price will increase of decrease over any given time period. You then place your trade at a value you can afford and when the time period has expired any profits are added to your account instantly.
Do All Binary Options Brokers Accept Nigeria Based Traders?

When you start to browse the internet looking or Binary Options Brokers you will find many of them will accept Nigeria based clients and some won’t. To make your life easier all of the sites listed on this site do indeed accept and welcome Nigeria based customers and as such you will have no problems what so every signing up to their sites, making a deposit, placing your trades and finally getting paid put any profits made in a very timely fashion.
Do I Have to Place Real Money Trades?

Each of our approved and fully licensed and regulated Binary Options Broking site knows that many of their clients will be new to the world of Binary Options trading and this is why they all make available to their newly registered clients a demo mode version of their trading platform. This demo trading platform will allow you to place demo trades on real time and current trading opportunities but do so in a no risk format. This is a great way to truly master placing the quite numerous different types of Binary Options that are available online at any time of the day or night, and it is an option we would advise all new traders make full use off.
What is a Trading Manager?

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You will often find that when you sign up to some Binary Options Brokers you will be designated your own personal Trading Manager, this is simply a member of the Broking site staff who is always on hand to help and advise you if you have any questions what so ever. This Manager is also the person to chat to if you are looking or any additional perks of using one site over another as they can often offer you completely risk free trades and additional promotions offers.
Are Trading Profits Paid Tax Free?

You will not be charged any taxes or fees when you have placed winning trades at any of our featured Binary Options sites and as such when you make a withdrawal of any gains make they will be sent to you free of tax. Be aware though there may occasional be some fees charged depending on just which withdrawal options you choose to get paid by, so always try and select on to use that has no fees attached to it!
Are Binary Options Sites Licensed and Regulated?

We have chosen to list only the Binary Options Brokers we know currently hold a full and valid trading license for that way we can be assured of each site we promote to our website visitors will offer you the very highest levels of service, and being regulated they do of course adhere to a very robust code of conduct and ethics. Please be aware not all Binary Options Broking sites you may stumble across online are licensed or regulated and you must always avoid trading any such a site!

What is binary option.

Binary option – a system of instant contract, according to which the alleged behavior of selected assets on the stock exchanges, namely their fall or rise over time.

Exchange trader chooses assets with which it will work, and indicates the forecast of their behavior in the market. It is further alleged in payout won, and the amount of compensation for a loss, as well as the specific rate and time of completion of the option. In other words, you do not buy the assets themselves (be it currency , precious metals, oil , stocks , etc.), and bet on their behavior in the market , building on the current changes that affect their price. Thus, the trader can raise money even at the minimum jumps assets, not even thinking about the necessity of obtaining of the original.

Managed risks – a characteristic feature of binary options is the initial notice in the trader about the risks. You know exactly the amount that will be able to win a preliminary assessment of the risks, even before it had a deal. Ease of operation – depends only on the change factor prices, and hence: profit requires less information, and items. That’s why binary options are popular not only among experienced traders, but also among those new to the trade.

The relative availability – achieved value for money in itself is not an asset, and in the contract for the predicted price movement. This is what allows us to overcome the price threshold, which is not all traders can overcome when dealing with tangible assets (precious metals, oil, currency pairs, etc.) Profitability – perhaps this is one of the root causes of popularity of binary options abroad, since this figure is often more than the profit from similar rates but with the assets. Here it is sufficient to predict the behavior of assets otnoshetniyu to the current point (growth or decline) to get the result.Profitability – perhaps this is one of the root causes of popularity of binary options abroad, since this figure is often more than the profit from similar rates but with the assets. Here it is sufficient to predict the behavior of assets otnoshetniyu to the current point (growth or decline) to get the result.

Binary options have been functioning in the market since the year 2008 and first appeared on the Chicago Board Options Exchange (CBOE) and the options are European style so-called All-or-nothing. Although if you dig a little deeper , we can understand – the emergence of binary options in the OTC market originated much earlier. Certainly , the growing popularity of binary options required relatively simple, where in most cases the basic rule of winning option is only correct choice of the direction of movement of assets (call, or put). In other words, there is no need to accurately determine the extent of the growth or decline of exchange of assets for possible revenue from the purchased assets , but only to anticipate higher prices or price reduction of their market value. In addition to all the above, you can immediately evaluate the gains and risks of a particular amount that is fixed and the transaction itself.

Here’s an example: the current market value of gold is 1313,014 at 12:15, at 13:00 it reaches 1316,470. The price for gold rose and Call transaction during this period became profitable for the asset and within an 80% income out of $ 1,000 it makes $ 800 profit in 45 minutes. But do not forget about the low degree risk rates, for example where the trader at 40% income receives significantly less profit and at the same time protects him/her-self from the loss of the entire amount bid at loss option and will receive compensation from the rate. In general, it is worth noting that the opinions on the effectiveness of various strategies of options vary much and each experienced trader prefers his/her already proven method.

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Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    The Best Binary Options Broker 2020!
    Perfect Choice For Beginners!
    Free Demo Account!
    Free Trading Education!
    Get Your Sing-Up Bonus Now!

  • Binomo
    Binomo

    Only For Experienced Traders!

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