Binary options are based on a straight forward yes/no proposition and provide a fixed and predetermined return. Binary options provide an ideal way to enter the world of financial trading as they are simple to understand and trade. Previous trading experience is not required.
OptionCM™ offers trading on a variety of assets such as stock market indices (e.g. FTSE), stocks (e.g. Google) , commodities (e.g. Gold) or currency pairs (e.g. EUR/USD).
At OptionCM™ a financial binary option presents two possible market movements depending on the trading instrument:
- High / Low Instrument: Decide whether the asset price will go UP or DOWN.
- One Touch Instrument: Decide whether the asset price will TOUCH or will NOT TOUCH the target price.
- Boundary: Decide whether the asset price will stay in a target price RANGE or not.
A profitable option which expires “in the money” will provide a fixed return on the invested amount. For example an investment of 500USD on a EUR/USD High option bought at 1.4407 will provide a return of 925USD if the price at expiry is higher than 1.4407. The return is will not change by how much the purchase price is exceeded at expiry (e.g. 1.4408 and 1.4459 will return the same profit).
If the price at expiry is lower than the purchase price then the option in this example will expire “out of the money” and the investment will be lost.
In order to aid trading decisions OptionCM™ provides background information on all traded assets and graphs showing historical data.
OptionCM™ also provides for “Early Closure” of traded options. This feature allows traders to close positions before expiration time minimizing risk and allowing protection of profits.
- Choose an asset you would like to trade from the drop down menu.
- Select “High” if you think that the price will be above the current level at the expiry time.
Select “Low” if you think that the price will be below the current level at the expiry time.
- Enter the amount you wish to invest and click “buy”.