BINARY OPTIONS
BINARY OPTIONS
What are Binary Options?
What are Binary Options?
Binary options are a type of derivative financial instrument in which the investor must predict the price movement of an underlying asset within a specific time period.
Unlike traditional investments, binary options offer only two possible outcomes: winning a specified fixed amount of money if the prediction is correct or losing the initial investment if the prediction is incorrect.
Here are some key aspects of binary options:
1. Fixed Payout:
Binary options have a fixed payout if the option expires "in the money" - that is, if the investor's prediction is correct.
2. Two Outcomes:
Hence the term "binary", as there are only two possible outcomes: winning a predetermined amount or losing the entire investment.
3. Expiration Date:
Binary options have a specific expiry date and time, and the outcome is determined at that time.
4. Underlying Assets:
They can be based on different types of assets, such as stocks, currencies, stock indices, or commodities.
5. Regulation and Risk:
Binary options are known to be high risk due to their all-or-nothing nature. In many countries, they are subject to strict regulations or even banned due to concerns about fraud and transparency.
It is important to note that due to their high volatility and risk, binary options are not suitable for all investors. Those considering investing in them are advised to inform themselves adequately about the risks and regulations applicable in their country.
You can purchase the RFX services as an add-on through your Eaconomy backoffice if available in your country.