Binary Options Trading

A binary option contract is in essence one of the simplest option contracts, which features fixed risk and fixed reward. What that means is that you know exactly how much money you’re risking on the trade before you click that launch button and you also know how much you stand to pocket if your trade ends up in the money. The online trading of binary options has become commonplace lately, as this option-format lends itself exceptionally well to the online realm.

When trading binary options, you, the trader, never actually gain possession of the traded asset. You merely wager on whether its price will be above or below its current level, after a set amount of time elapses. You essentially purchase the option, and then you wait for it to expire, to see whether or not your prediction regarding the price of the underlying asset comes true.

Binary options are financial products, available through specialized brokerages and exchanges (in the US). In order to trade binary options, you will have to register an account with a broker, and deposit money with it. There are scores ofbinary option brokerages peddling various services, under various jurisdictions. What you should absolutely strive for in this regard, is to sign up with a regulated broker, that preferably enjoys a good reputation within the trading community.