The easiest and most popular form of binary options. When trading this kind of binary options you need to determine whether or not the course will be selected asset is above or below the current market rate at the time of option expiration.
Consider the example of a transaction on the binary options Above / below:
In order to make money on the binary options, you need to determine whether the rate of the selected asset is above or below the current rate at the time of option expiration. Select the asset, expiry time and click the button “above” or “below”. In the opened window, specify the amount of the transaction from 400 rubles. / $ 10 to 40,000 rubles. / $ 1,000. Confirm the transaction by pressing the OK button. The payment is carried out at the time of option expiration.
Consider the basic parameters of the deal on the binary options Above / Below:
Active – a financial tool, to change the course that you want to make a prediction. Thus assets may be stocks well-known companies (Apple’s, Gazprom), commodities (gold, oil), currencies (EUR / USD – Euro exchange rate against the dollar), stock indices (Dow Jones, NASDAQ). To begin, select the assets that you know about the causes of changes in the value of which is known to you. We see our description of assets under a list of assets. For binary options “Above / Below” is available a wide range of assets.
The direction of change of course
Rate changes direction – that is your prognosis. From it directly depends on whether you earn in a given transaction or lose money. When trading binary options “above / below” check your prediction occurs at the expiration of the option. If you choose the direction of “above” and at the time of expiry of the selected course of an asset above the target rate, ie the one that was at the time of the transaction – you make money, if it is below – lose. Conversely, if you choose the direction of “Below” and at the time of expiry of the selected course of an asset above the target rate – you lose money if less – earn.
Read more about how to predict the rate changes.
Binary Option expiration time
Binary Option expiration time – it is a moment in time at which checked whether your forecast or not justified.
After time may be:
15-minute intervals, ie 15, 30, 45, 00 minutes of the hour
the end of the hour
the end of the day
the end of the week
Typically, the choice of the expiry of the time depends on the factor by which you make your prediction of changes in assets, for example, if you expect the rate of motion at the time of important economic news release in a few minutes, choose a 15-minute interval, and if your forecast is based on analysis of the day’s closing rates, choose the end of the day or the end of the week.
Expiry time of the binary option is the same important parameter, as well as the direction of change of the course. Choose it carefully, because it depends on it, you will earn or lose money on each trade.
The amount of the transaction
From the amount of the transaction on binary options depends directly on the size of your payments – the amount you will receive, if your prediction was justified.
For example, if the payments on your chosen Binary options ratio is set at 181%, and you have chosen the transaction amount of $ 100, you get $ 181, and if the transaction amount of $ 2000, you will get $ 3620.
Of course, the deal is what you risk if your forecast was not justified. At the conclusion of the deal when you have selected all the parameters of the transaction and click “Confirm”, the amount is deducted from your account balance. There are no traders, which make correct predictions and receive payouts on every trade. If you invest in your deal the full amount in your account and your prediction will not come true – you have no more money left to fix your mistake. Therefore for successful profitable trading it is very important to follow money management strategy – the rules that determine how much money to invest in the transaction and, depending on your account balance and your trading strategy.
Payment – the amount that you would get if your prediction was justified. As we said earlier, the payment depends on the amount of the transaction. It also depends on the payout ratio, which you can see before entering into the transaction. For example, if the amount of your transaction of $ 100, and the payout ratio – 181%, you’ll get $ 100 * 181% = $ 181. If the payout ratio is set at 175%, then the same amount of the transaction you will receive a $ 100 * 175% = $ 175.
For binary options “above / below” payout rate is usually set in the amount of 175% to 181%, depending on the type of asset. Details of the payment amounts, see the list of assets.
Please note that payment is not the same thing as profit. Profit on the transaction will be the difference between the payment and the amount of the transaction, ie at 181% payout ratio, and the amount of the transaction of $ 100, your profit will be equal to 181 $ -100 $ = $ 81, or as a percentage – 81 $ / 100 $ * 100% = 81%.
The target rate or the target level – a course which will be compared to the price of the chosen asset at the time of expiry of the transaction, in order to determine your prediction was justified or not. For a binary option “above / below” the target rate is set equal to the current market rate at the time of the transaction, that is, at the moment, when you have chosen all the parameters of the transaction and click “Confirm.” If you choose the direction of “above” and at the time of expiry of the selected course of an asset above the target rate – you make money, if it is below – lose. Conversely, if you choose the direction of “Below” and at the time of expiry of the selected course of an asset above the target rate – you lose money if less – earn.
Please note that as long as you choose the parameters of the deal, the market rate changes. Carefully check the current market exchange rate before you click on the “Confirm” button. It may happen that the movement in the direction already happened you to predict and then open a transaction too late, in which case you may lose your money.
Time of completion of transactions
For each option expiration time set time of completion of transactions. Typically, time of completion of transactions is set for 5 minutes before the time expires. For example, the option with the expiration of the time 16:45, the transaction no longer taken at 16:40. After 16:40 you can not make a deal with the expiry at 16:45, but of course you can make a deal with the following expiry of the time – 17:00.