American Option. American Stock Exchange Amex. AMF Autorité des marchés financiers. ASIC regulation. Asset class. Asset management. At The Money. Auction market. Australian Financial Complaints Authority AFCA. Automated binary options trading. BaFin Federal Financial Supervisory Authority. Bank run. Barrier to entry. Basic currency. Bear market. Bid and ask price.

Binary Options. Binary Options certificate. Binary Options demo contest. Binary Options license. Binary Options loss. Binary Options payout. Binary Options Profit. Binary Options regulations. Binary options rollover. Binary Options trade. Black Scholes Model. Black Scholes Model formula. Boundary Instrument. Bull Market. Call Accumulator. Call Delta. Call Gamma. Call Option. Call Options - Up and In. Call Theta. Call Vega. CFD Contract for Difference. Chart types for the technical analysis.

Chicago Mercantile Exchange. Cold calls. Common shares. Consensus estimate. Credit card. Crude oil price. Crypto mining. Crypto Options. Crypto wallet. Cumulative Distribution Function. Dark Pools. Day trader. Deal ticket. Demo account. Digital options.

Direct market access. Dividend yield. Double No Touch Options. Double Options. Dow Jones. Down and In Call Options. Down and In One-Touch Calls. Down and In Put Options. Dragonfly Doji. Duke of York. Eachway Call. Eachway Tunnel. Early Closure. Engulfing candle. Error function. European Option. European Securities and Markets Authority ESMA. European Supervisory Authority. Exchange-Traded Fund ETF. 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.

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. Expiration time: In simple term it is the time and date when the option is supposed to expire. Whatever the result of the trade is on that particular date at the pre-agreed time; It has to be borne by the traders.

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. 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.

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.

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

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. 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.

By Binoption. Last Updated: Home » Binary Options Strategy » Binary Options Terminologies For The Investor In You. Binary Options Terminologies for the Investor In You - Binoption. Arbitrage-the purchase and simultaneous sale of options of the same type from different brokers, in order to obtain a guaranteed profit. Correlation — the degree of interconnectedness of the movements of different assets that belong to the same type. For example, the main currency pairs with the US dollar in the base, precious metals, oil and derivatives fuel oil , etc.

Technical analysis — a forecast of price movement based on the readings of technical indicators, geometric constructions or combinations of " Japanese candlesticks». Martingale is a trading strategy that consists in increasing the size of the investment in the option with each new loss. Option An option is a type of instrument that establishes the right, but not the obligation, of the client to make a transaction under previously agreed conditions.

Vanilla Option The vanilla option offers the trader to secure the right to purchase the underlying asset buy or sell , at a pre-agreed price strike. Prize The premium in binary options is the amount of the payout if one of the two conditions is correctly predicted, whereas in vanilla options, the premium is the value of the contract.

Express Options Binary options differ from vanilla options by the ability to combine several consecutive conditions in one trade, which follow each other and are tied to certain time intervals.

Put the forecast provides for a fall in the exchange rate at the time of expiration of the contract. At-The-Money ATM — the current tick-to-tick rate coincides with the entry point. Of-The-Money OTM — the price went in the other direction from the forecast value. In-The-Money ITM — asset quotes are in the correct direction of the forecast. For example, in the case of early closing of an option: in the case of OTM, the trader completely loses the bet investment - the amount paid when opening the contract, in the case of ITM, the bidder receives a pre-agreed part of the premium.

Return, Strike price, ask, bid, spread Expired OTM binary options can have a degree of protection refund, compensation — the percentage of the lost bet that the broker returns to the client's account. The underlying asset sometimes contains two different prices: ask — the price level that will be fixed when the movement is predicted to be "Higher". Exotic Binary Options Exotic binary options are a type of contract with an unusual underlying asset.

Trend, Flat, Tilt, " Night Trading» Trend — a directional movement of quotes, in which new extremes lows or highs are constantly reached. Open Interest Open Interest — the number of open and active options collected by the expiration time. Synthetic position Synthetic position-deals with the underlying asset and option that "simulate" other instruments, in particular a bond or stop-loss or take-profit orders.

Binary options are usually referred to the Forex market , as the main underlying asset for contracts are currency pairs.

But the terminology used in trading this type of OTC instruments differs from the generally accepted definitions in trading. An option is a type of instrument that establishes the right, but not the obligation, of the client to make a transaction under previously agreed conditions.

The practice of applying this definition in binary contracts is absent, it is more clearly disclosed in vanilla options. The vanilla option offers the trader to secure the right to purchase the underlying asset buy or sell , at a pre-agreed price strike.

The decision on a transaction with a real asset must be made at the time of expiration, at the end of the contract. A vanilla option is similar to a binary option only in that the trader loses only the amount of the option premium in the event of a rejection negative outcome.

The premium in binary options is the amount of the payout if one of the two conditions is correctly predicted, whereas in vanilla options, the premium is the value of the contract. Binary options differ from vanilla options by the ability to combine several consecutive conditions in one trade, which follow each other and are tied to certain time intervals.

Such composite instruments are called express options. The latter two definitions are actively used in the "American" type of contract, which implies the possibility to change the terms of the transaction. For example, in the case of early closing of an option:. If an ATM situation occurs at the time of expiration, the trader may lose both the bonus and the investment. Pay attention in advance to payouts in the event of an "At-The-Money"situation. Expired OTM binary options can have a degree of protection refund, compensation — the percentage of the lost bet that the broker returns to the client's account.

The value of the price at the time of expiration, called the exercise price of the option, decisions on payments are made based on this fixed figure.

The underlying asset sometimes contains two different prices:. The difference distance between these prices is called the spread. In most cases, brokers do not make distinctions for the opening prices of a binary option, using a single value. Exotic binary options are a type of contract with an unusual underlying asset.

They are based on any conditions that imply a double outcome, for example:. A limit deferred option order is a type of option with pre-agreed terms and execution time that takes effect only if the asset's quotes reach a certain deferred price level. Traders pay special attention to them, since the trends of national currencies and the market activity of trading are directly dependent on the working hours of these platforms. Trend — a directional movement of quotes, in which new extremes lows or highs are constantly reached.

Flat saw — a sideways price movement with a constant repetition of coinciding local highs and lows. Tilt — a state of panic, expressed in the fear of opening new positions, the lack of the ability to objectively predict the market, which arose against the background of significant losses. Synthetic position-deals with the underlying asset and option that "simulate" other instruments, in particular a bond or stop-loss or take-profit orders.

A bonus option is a contract under which a loss is not deducted from the client's account in the event of a negative outcome, but a bonus is accrued if the forecast is correct. Issued by the broker as a bonus, it has a fixed investment size and a limited amount. Sometimes the client is returned some of the positions that have already gone to a loss in the form of bonus options.

Arbitrage-the purchase and simultaneous sale of options of the same type from different brokers, in order to obtain a guaranteed profit. Correlation — the degree of interconnectedness of the movements of different assets that belong to the same type. For example, the main currency pairs with the US dollar in the base, precious metals, oil and derivatives fuel oil , etc. Technical analysis — a forecast of price movement based on the readings of technical indicators, geometric constructions or combinations of " Japanese candlesticks».

Martingale is a trading strategy that consists in increasing the size of the investment in the option with each new loss.

Option An option is a type of instrument that establishes the right, but not the obligation, of the client to make a transaction under previously agreed conditions. Vanilla Option The vanilla option offers the trader to secure the right to purchase the underlying asset buy or sell , at a pre-agreed price strike.

Prize The premium in binary options is the amount of the payout if one of the two conditions is correctly predicted, whereas in vanilla options, the premium is the value of the contract. Express Options Binary options differ from vanilla options by the ability to combine several consecutive conditions in one trade, which follow each other and are tied to certain time intervals.

Put the forecast provides for a fall in the exchange rate at the time of expiration of the contract. At-The-Money ATM — the current tick-to-tick rate coincides with the entry point.

Of-The-Money OTM — the price went in the other direction from the forecast value. In-The-Money ITM — asset quotes are in the correct direction of the forecast. For example, in the case of early closing of an option: in the case of OTM, the trader completely loses the bet investment - the amount paid when opening the contract, in the case of ITM, the bidder receives a pre-agreed part of the premium.

Return, Strike price, ask, bid, spread Expired OTM binary options can have a degree of protection refund, compensation — the percentage of the lost bet that the broker returns to the client's account. The underlying asset sometimes contains two different prices: ask — the price level that will be fixed when the movement is predicted to be "Higher".

Exotic Binary Options Exotic binary options are a type of contract with an unusual underlying asset. Trend, Flat, Tilt, " Night Trading» Trend — a directional movement of quotes, in which new extremes lows or highs are constantly reached.

Open Interest Open Interest — the number of open and active options collected by the expiration time. Synthetic position Synthetic position-deals with the underlying asset and option that "simulate" other instruments, in particular a bond or stop-loss or take-profit orders. Bonus option A bonus option is a contract under which a loss is not deducted from the client's account in the event of a negative outcome, but a bonus is accrued if the forecast is correct.

Arbitration Arbitrage-the purchase and simultaneous sale of options of the same type from different brokers, in order to obtain a guaranteed profit. Correlation Correlation — the degree of interconnectedness of the movements of different assets that belong to the same type. Technical Analysis Technical analysis — a forecast of price movement based on the readings of technical indicators, geometric constructions or combinations of " Japanese candlesticks» Fundamental analysis Fundamental analysis-forecasting based on economic indicators and political events.

Martingale Martingale is a trading strategy that consists in increasing the size of the investment in the option with each new loss. Binary Options. Hedging in stock trading is a process aimed at protecting. Albert Grof. Mar 11, Binary options testing is the process of searching for new. Mar 10,

Unregulated binary options brokers don't have to meet a particular standard. Price action. Swing trading. Underlying Asset: This is the stock, commodity, currency pair, or index on which you are basing your option. Sign function. Binary Options demo contest. Refund, strike price, ask, bid, spread Expired OTM binary options may have a degree of protection refund, compensation — a percentage of the lost bet, which the broker returns to the client's account.

Categories:

• Binary Options online
• Forex Bitcoin
• Forex
• Binary Options
• Forex Brokers