Types of Binary Options

Types of Binary Options

There are a few different types of binary options that may make trading confusing to people new to the market.  These different types of options were created so traders can pick a method that suits their needs.

Traders take in different factors like external market influences, trends, results or announcements to decide which type of binary option is best for them.

ic_launcher_72x72When looking at the types of Binary Options, it helps to keep in mind that “binary” means two – meaning you have one option or the other.

Digital Option

The digital option is generally the most common type of Binary Option.  This type of option is also referred to as an up/down option or call/put option.

In this type of option, the trader places a call if they believe the price will increase after the predetermined amount of time.  The trade would call place a put if they believe if the price will finish below the entry price.

Touch Option

A touch option is a relatively new type of Binary Option based on the principles of Forex Trading.

Touch options come with predefined rates needed to finish in the money instead of simply predicting whether the asset increases or decreases.

This type of option depends on if the asset will reach the strike price within any time before the predetermined amount of time expires.

If a trader predicts correctly and the asset reaches the strike price, they would finish“ in the money”.  The rate of return for Touch Options is very high, between 75%-85% to the investor.

Touch options have many varieties including no touch, double touch & touch.

60 Second Option

The 60-second option is very similar to digital options.  The main advantage of trading 60-second options is if the trader sees an asset clearly moving in one direction, then they can conducting multiple, successive 60-second trades to maximize profit.

This platform is ideal for people looking for quick returns on their money and who have enough experience to respond quickly & effectively to how the market moves.

Boundary Options

Boundary Options are also known as Range Options or Tunnel Options.  This type of option is similar to Touch Options.

Boundary Options have 2 different levels, the upper & lower, also known as the Boundary or Range.  In order to finish in the money, the trader needs to asset to stay within this Range or Boundary.

This type of option is ideal in a stable market when trading inside the boundaries & ideal for a volatile market if you trade outside the boundaries.

In order to truly take advantage of all the types of Binary Options, you’ll have to spend a lot of time researching & learning in order to come up with a reliable method for success.

Testing and demo account trading are among the most popular ways to refine your skills.  Coming up with a consistent, profitable method is key to being successful, no matter what type of binary option you choose to trade.