Options Glossary
Binary Options
A binary option is a type of option where the payoff has two possible outcomes: The first where the investor receives some fixed amount of an asset, and the second possible outcome is where nothing is received.
Binary Options Brokers
Binary Options Brokers or binary options trading platforms are online trading sites where investors can make money online trading binary options.
Cash-or-nothing binary option
In this scenario the investor gets paid some fixed amount of money if the option expires in-the-money.
Asset-or-nothing binary option
Here, the investor gets paid the value of the underlying security.
All-Or-Nothing Options
A synonym for binary options
Digital Options
A synonym for binary options more common in forex and interest rate markets)
Fixed Return Options (FRO’s)
A synonym for binary options more common on the American Stock Exchange.
Call Option
When trading binary options online, a call option is what the investor buys when they project that a specific stock option will go up, or above the price during the time when the purchase was made.
Put Option
When trading binary options online, a put option is purchased by the investors when they perceive that the stock they chose will expire (or go down) below the original purchase price.
At-The-Money
Traders use this term to describe a neutral loss and gain/win situation where the value of the asset stays more or less unchanged as when it was purchased.
Touch
One Touch or No Touch – A binary options trading tool where the trader can try to predict if a specific financial asset will touch or not touch a prefixed set price at any given time before the time it expires.
Range
In or Out of the Range – Online traders can try to predict if a certain financial asset will expire in or out of a prefixed range. This is also called Tunnel or Boundary options.
Triple
As you would have in Spread Betting or multi-hand betting , the investor can trade and carry out three deals concurrently.
Matrix
Also know as short term trading by many. In the situation it resembles the look and feel of a bingo table , where the trader can use the table to try and predict what percentage of specific asset prices will change during a given period of time.
Current Price
The price or value of the asset in near real time. Current prices usually have a 15 minute delay, sometimes even more and in most cases are provided by companies offering information about the free price .
Forex
Forex or foreign exchange, is the market where international currencies are traded. The forex trading market is the largest, and most liquid in todays global trading environment with average trade values that exceeds $1.9 trillion a day including all global currencies.
Expiry Price
The price of the asset during the contract time of expiration.
Commodities
Commodities are physical raw substances (i.e. crude oil, gold, copper) that are traded by investors across the markets.
Expiry Time
The time and date when the option expires. It varies and can be on ab hourly, daily, weekly, or monthly basis, depending on who the the broker is and the nature of the binary options contract.
