Binary Options Terminologies For The Investor In You

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Contents

Binary Options Terminologies for the Investor In You – Binoption

It is always said that binary option is simple and easy to understand, but what are those easy understanding things?

What are the parts of the essential knowledge to start trading?

This article will give answers for the same.

It is quite obvious that you might lose your money and fail if you trade without any knowledge or skill.

For this reason you should have basic information of trading such as what each terms mean and how they works.

These are the main terms when it comes to trading binary options and this amount is crucial to start trading and making money in this competitive market.

Binary Options Terminologies

Assets: For binary option trading the term asset means the underlying stock, currency pair, commodity or index.

These assets are not traded physically, the value for trading is taken from these underlying assets and as per the market movement only difference will be settled among traders.

Thus there is no need for warehousing the stock for any actual delivery.

Binary Options: This is an online investment method through which money is deposited into a trading account and invested on a variety of assets.

The investment is agreed at a pre-determined price and for a pre-determined expiry period.

Through this investment if you make profit, then it is known as “in – the – money” and if you incur losses, then it is “out – of – the- money”.

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Broker: Trading binary option is possible only through brokers.

These brokers offer online platforms which is made use by traders to learn binary option, to test their strategies and to make any profits.

Apart from offering platforms for trading, they also handhold many new and young traders to come up with best trading strategies and trading style.

Current rate: This is the present market rate of the asset.

The movement of this prices determines whether you make profit or not at the expiration date of the trade.

This price depends on the market conditions and the more volatile the market is chances of generating profits is high.

Range Option: This is also known as “zone Option” and this is a limit that is set by companies for different zones.

Trades can be executed within this price range.

Expiration time: In simple term it is the time and date when the option is supposed to expire.

This date is fixed while executing the trades.

Even if you make profit through the trade or not, it will be live only till the expiration date.

Whatever the result of the trade is on that particular date at the pre-agreed time;
It has to be borne by the traders.

When it is profiting for one trader, it will be a loss for the other.

High or Call Option: This option expects the price of the asset will rise in the future and thus the trader will execute trade agreeing to buy the stock.

If as per the prediction the market price shoots up, then the trader will resell it at the agreed rate and make a profit.

Low or Put Option: The right opposite of Call option is put option.

Here the trader thinks that at the market price will fall and thus will agree to book a sell trade with a price that is higher than the expected market price (low).

In the money: When the market movement is predicted correctly, the trader will make profit on the deal.

When trade booked results to a profit, it is called in the money.

All traders will execute trades to have this as the final result.

Out of the money: This is the opposite of in – the – money.

The market will not move according to the predictions of the trader, thus expected returns will not be generated.

In this situation the trade makes loss out of the transaction which is called as out of the money.

Rate of profit: This is the rate of return the trader is expected to get if the trade turns out to e in the money (profit).

Strike Price: This is a pre-determined price at the time of booking a trade.

It is the barriers in case of no touch, one-touch or double touch binary options.

Technical analysis: This is a method of analyzing the market with the help of chart patterns and indicators.

It helps in forecasting the price movement of the asset on the basis of past trends and volume of the asset.

Fundamental analysis: On the flip side of technical analysis, the fundamental analysis works totally on the evaluation of the stock,

Any fluctuation is the commodity or currency due to various factors such like demographic, political, geopolitical, micro and macro economics and so on.

These are the basic terminologies that a trader should be aware about.

With the help of these alone a decent profit can be generated if you are dedicated and determined.

However to be a long term successful trader you should learn a lot more about binary option and it’s strategies and technique.

There is no end for learning in this topic.

It is still growing and getting updated day by day as per the latest requirement.

This is the reason why it is considered as one of the best investment option in trading and is widely accepted by past and young generation.

All these kept aside the main highlight is the risk is limited to what your investment is.

And if required the trader has an option to set independent limit within the initial investment such that there is a block due to which your whole investment will not get drained out.

All these above mentioned terms are called the core economics of a binary option trade.

Without these it is impossible to execute a binary option, though some of the terms are similar to Forex trading;
Its working and returns on the same is totally different.

If you are looking to go through the information of a binary option academy, then this basic information should be the first and most important that every trader should be aware of before trading options.

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Best Binary Options Strategy For Beginner & Experienced Traders – Binoption

Traders are constantly in need of a working binary options strategy for their trading.

Without a trading strategy, no trader can achieve success in trading.

Whether it be forex, crypto, stocks, indices, or any other asset, you need a strategy that suits your trading style and brings you consistent profits.

The common misconception among non-traders is that trading is a game of luck. The reality is far from the truth.

Trading is a very complex activity. There is a lot of reasoning behind every action that is performed.

A trader carefully selects his trading asset, analyzes its market, performs technical analysis, and then performs the trade.

Even after all this, the chances of winning are pretty slim. You cannot out predict the market.

Binary Options are based on a yes/no proposition.

Earning a payout depends on accurately predicting the outcome of the market beforehand.

If you guess wrongly, you will lose your investment.

Therefore, it is extremely important you trade with caution.

A trading strategy is the backbone of any successful trade.

Our strategy section contains various articles that will cover all aspects of binary options strategy.

You will learn how to utilize different strategies and when to use which one.

Best Strategy List For Binary Options Trading:

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Pick Your Trading Strategy Now For Your Trading!

Best IQ Option Strategy- IQ Option Tips For Winning Trades

How to Evaluate Your Binary Options Trade: Things To Mind

6 Styles Of Trading Strategies: Find The Best One For You

60 Seconds Binary Options Strategy: Know the Advantages

Ways to find Binary Options Strategies Without Losing Money

Technical Analysis versus Fundamental Analysis Of Binary Options

Be an Expert in Binary Options in Your Own Style

DoubleUp Strategy For Binary Option Trading – How It Works

Binary Options Training Programs in Detail

Best Two Binary Options Strategies for Trading

Use of Binary Options Strategies over Forex Trading

Executing Your First Trade – Binary Options Trading Checklist

Need For Solid Trading Strategy For Binary Options

Reasons For Rising Demand On Binary Options Trades

Survival Tips for Binary Options Traders: Crucial Period of Trading

Binary Options Terminologies For The Investor In You

Binary Options Types In The Current Market And Their Strategies

Things To Consider Before Opting For A Binary Options Account

Some Characteristics Of Reliable Trading Broker

Binary Options Trading Assets: 4 Pillars Of Binary Options

Binary Options Management Strategies To Become Successful

Benefits Of Binary Options Trading That Attracts Trades

What Are Candlestick Charts And How To Use Them For Trading Binary Options?

Binary Option Trading Checklist Before You Start Trading

Identifying Consolidation Area: Call Put Strategy

“An Old Gambler’s Tool” – The Curious Case Of Martingale Strategy

The Basic Bull Call Spread Strategy In Binary Options Trading

What Is The Breakout Strategy for Binary Options?

6 Facts For Binary Options Trading Formulas And Strategies

In Binary Options How Does Trading Techniques Actually Work?

What Is Trading Strategy For Binary Options?

A trading strategy is basically a well-thought out plan that is designed in order to profit from the trading market.

A strategy is formed on the basis of both fundamental and technical analysis.

Fundamental analysis involves analyzing the factors that affect the asset’s market value such as economic and financial conditions, interest rates, company earnings, competitors, and much more.

After analyzing these factors, the asset price will be estimated.

The analyst then compares this estimated price with the current market value and determine if the asset is undervalued or overvalued.

If it is overvalued, the recommendation would be to sell it, and buy if is undervalued.

Technical analysis is the process of analyzing the market through trends and and information collected from trading such as volume and price movement over a certain period of time.

Using indicators and graphical tools, trends are recognized and future price movement is predicted.

When forming a trading strategy, you need to combination of both.

In our strategy guides, we guide you step-by-step, to do exactly that.

The Need For Successful Binary Options Strategy

Though many new comers are of the opinion that there is no need for trading strategies for making money through binary options , this article will help you to understand the real reasoning for the need.

These binary options strategy collectively will help you in understanding and analyzing whether you made profit at the end of each month.

In order to know this, firstly every trader should be aware of what they are doing.

Basically as a trader you should be aware of where the results of your trades are arising from.

Trading without strategies is driven by emotions and will be random.

After certain point of time, you would have either made some money or not.

But there will be no certainty thus you will be unable to be understand what helped you to make or lose money.

This lack of information will be a block for improvement.

This can also result in try different trading styles on a regular basis and will be unable to settle with some style that will surely help you to make some money.

In order to make trading fruitful, learn how to trade binary options.

As you will have clear picture of the amount of money you make and the source for the same, there will be less chance of failure or struggle.

In this way, you can concentrate on those styles of trading that are your strength and can eliminate the chances of you failing.

It is essential to keep in mind, no one is a master in trading binary options nor are they born with the skill of trading.

All these are learnt through information and experience.

However, following some binary options strategy are a tool that will help you to improve your trading overtime.

It can be said that- ‘Only with the help of knowing what you are doing to your trades, you will be able to judge or predict the result of your initiatives”.

To summarize, you will need a working binary options strategy for the following reasons:

  • Profitable trading
  • Focus on trading without distractions
  • Measure and improve performance
  • Eliminate emotions from trading
  • Prevent over trading
  • Enrich your trading knowledge
  • Reduce risks in trading

Binary Options Trading

This article will show you the basic terms in binary options trading.

Binary Options: Many people see binary options trading as a hassle free method of investing in the worldwide financial markets. It is a type of trading known worldwide for its speed. Compared to the traditional type of trading where only the elite traders had access to investing money, binary options trading has opened up the market to traders from all walks of life.

What are Binary Options?

Binary options are contracts that give a trader the right but they are not obligated to buy an underlying asset at an agreed price and specified period of time. Unlike purchasing shares or stocks, with binary options you are not actually buying anything. If you are interested in the best Australian binary options brokers, then go to our homepage.

The Basic Terminologies of Binary Options Market:

It is important that you familiarize yourself with the following binary option market terminologies.

Binary options – the word binary means that there are two possible outcomes you will make a profit if your prediction is correct or if your prediction is wrong you will lose money. It al depends on your initial investment whether you gain or lose money.

Call option – this is the option an investor uses when they want to predict an increase in the value of an underlying asset. No mater how little the price increases the trader will make money from binary options.

Put option – this is the option a trader will use when he/she is predicting that an underlying asset will decrease in value. Again, no matter how small the decrease, the trader will make money from binary options.

In the money – if you predict the trade correctly, this is the term that is used. Foe example, if you chose the call option and the price of the asset increased then you have won the trade (in the money) in binary options terms. The same applies to the put option and the price decreases you are still in the money.

Out of the money – if you have called the trade incorrectly then you have lost the trade (out of the money) in binary terms. If for example you chose a call option but the asset decreased in value, you have lost the trade and are out of the money. If you chose the put option and the price increased, you are also out of the money.

At the money – If an asset expires at the same price as it was at the start of the trading time it is known as at the money. If this occurs it means that your prediction was not right or wrong. Then you full binary options premium will be returned to you.

Expiry date – this is the specified time or date that the chosen binary option will expire. At the expiration time it will then be decided if you are in the money or out of the money.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

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  • Binomo
    Binomo

    2 place in the ranking!

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