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Binary Options Terminology You Should Know

With the ever increasing popularity of binary options trading it is now more important than ever to have the necessary knowledge about binary options terminology. Binary options are one of the more simple asset class products that are traded the one still needs to be familiar with the terms that are used when trading binary options .

Binary Options- Binary options are also known as the fixed return options. It is really quite basic these options can have one of two outcomes either a win or a loss. Some trading systems allow for a draw or when the price is the same from origination this means that the client does not win or lose any money.

Asset Class- The asset class it or also known as the underlying asset is the product that the binary option is representing. In many cases this would mean the particular currency pair that is represented by the binary option but its other cases it could also mean a stock a commodity or a particular index.

Expiry Time- The expiry time refers to the length of time that the option is open at the end of the expiry time the result of the option is then determined. With binary options expiry times can range from as short as one minute to as long as one day.

In the Money and Out of the Money- If a binary option is in the money it is then in a positive direction for the traitor if a binary option is out of the money then it is going against the binary option trader.

Investment amount- The amount of money that is placed on a particular binary options trade.

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