Binary Options Types    Trade Forex / Binary Options Without Risk

Binary Options Types

Binary Options Types

Introduction of 5 major types of binary options: cash-or-nothing, asset-or-nothing, one-touch, no-touch, and double-one-touch/double-no-touch.

1) Cash-or-nothing options; this is the most common type of option, as the name shows, this is a predetermined fixed contract in which you either win or lose the entire amount traded; the entering price and expiry time are also predetermined so there are no variables to focus on. You choose the prediction, up or down, and wait for the expiry time to find out the result.

2) Asset-or-nothing options is a type of option where the stake is the asset itself, rather than the amount of money invested; in this type of option the traders wins or loses the value of the asset he traded, depending on the price of the asset at the expiry time.

3) One touch binary options is a different type of trade from the two already presented above. In this type of option, the trader has to predict if an asset will “touch” a specific price level during the specified time of the trade.

4) No touch binary options trading is the opposite of one-touch option; the trader predicts whether an asset price will not touch a specific level during the specified time.

5) Double one touch and Double no touch are similar to the types 3 and 4 described above, with the single difference that there are two levels this time. In the double no touch option, there are two price levels that the asset needs to hit before expiry time, while in the double no touch option, the asset price trend mustn’t touch any of those two levels until the time expires.

Almost all brokers use in their Binary Trading Software these ways of tranzaction.

Any trading type will have two options known as call option and the other one is put option. Call option is the right the trader enjoys for getting a contract for an amount that is determined in advance. The put option is the right the trader will get for making a sale of the contract at an amount that is again finalized in advance.

All that the trader needs to do is to predict the direction the price of the instrument or asset will move to and has to make calculations if the price will be shooting up or climbing down after taking a careful analysis of all the factors determining the price. The binary option is said to be one of the most favored and simple methods of trading since the traders are aware in advance about the profit or loss they would incur and the risk is less.

Related articles :