Binary Trading Information


Find out the basics of binary trading and learn why all the smart investors are turning to this system

  • Why binary trading?
  • Types of binary trades
  • Benefits of binary trading
  • How to: trading binaries
  • FAQ about binary trading
  • Glossary of binary trading terms

Why choose binary trading?

Binary trading is a simple way to make real online profits

A binary trade is: an option with a fixed payout that is determined at the start of the trade, there can only be one of two outcomes.
If your prediction is accurate, you receive the predetermined agreed payout (normally between 80% & 95%) - if not, you only lose your initial stake.
For example, initial stake was $100:

  • You win, your return is $180~$195 (depending on the return rate)
  • You lose, you would only lost the initial stake of $100 and no more

The options are called 'binary' because there can be only two outcomes – win or lose.


Binary trading is easy & flexible

With Binary trading on binary.com, you can normally trade:

  • All markets - currencies, stock indices, and commodities.
  • All market conditions - up/down, touch/no-touch, stays in/goes out.
  • All durations - from 10 seconds to 365 days.
  • All payouts - from $1 to $100,000.

We have chosen up/down as the favoured strategy, as the results are much easier to predict.


Individual Traders

If you are still learning trading, you'll appreciate the simplicity and limited risk of binary trading.
Binary trading on binary.com offers low minimum stakes (as low as $1), so you'll soon learn how to trade with skill and confidence.
Any questions you might have will be answered by our helpful & experienced customer support team.


Market Professionals

Banks, hedge funds and professional investors routinely trade binary options in over-the-counter derivatives markets.
Market professionals often use and trust the binary options trading platforms as it offers easy access to high-volume, flexible trades.

Types of binary trades

Whatever your market view or strategy, binary trading offers many ways to profit from your prediction
  • Up/Down trades
  • Touch/No touch trades
  • In/Out trades
  • Asians
  • Digits
Up/Down

Choose Rise/Fall when you want to profit from the market rising or falling from its current level. - This is our chosen strategy.

Choose Higher/Lower when you want to profit from the market ending higher or lower than a price target.
  • Choose the market, the time period, and how much you wish to win.
  • Price the trade.
  • Win 10-1000% on your stake if you are correct. Increase your winning return by choosing a price target farther away from the current price.
Touch/No Touch
Choose Touch / No Touch when you want to profit from the market touching or not touching a target any time during the contract period.
  • Choose the market, the price target, the time period, and how much you wish to win.
  • Price the trade.
  • Win 10-1000% on your stake if you are correct. Increase your winning return by choosing a "Touch" trade, with a price target farther away from the current price.
In/Out
Choose Stays In/Out to profit from the market staying inside or going outside two price targets any time during the contract period.

Choose Ends In/Out to profit from the market stopping inside or outside two price targets at the end of the time period.
  • Choose the market, the price targets, the time period, and how much you wish to win.
  • Price the trade.
  • Win 10-1000% on your stake if you are correct. Increase your winning return by choosing "Stays In" with a narrow price target.
Asians
Choose Asian Rise/Fall when you want to profit from the market ending higher or lower than the average price.
  • "Asian Rise" – You win when the last tick is higher than the average of the ticks during the trade.
  • "Asian Fall" – You win when the last tick is lower than the average of the ticks during the trade.
Digits
Choose digit if you want to profit from predicting the last decimal digit of the spot.
  • "Matches" – You win when the last digit of the last tick matches your prediction.
  • "Differs" – You win when the last digit of the last tick does not match your prediction.

Benefits of binary trading

Simplicity
Binary Trading is simple to learn and to execute. Known risks - you know from the start what you will win or lose. Low minimum stakes - start trading with as little as $5. No surprises - no 'slippage', no 'margin calls', no getting 'stopped out', and no hidden fees or commissions. Instant access - open an account in minutes.
Low cost, fast returns with high profits
Trading in binary options is becoming an increasingly popular form of trading in the financial markets. They offer a way to trade a wide variety of financial assets across multiple markets and offer greater reward in a shorter period of time to regular investments. In this article we will outline the main reasons why trading options can be beneficial for you.
Limited risk
Binary options online can be traded using minimal amounts of money. This means that you can risk as much or as little as you can afford to. You are presented with the amount you stand to win, and the amount you stand to lose, prior to any investment. This means you are prepared - and by only investing what is within your means, you are essentially able to calculate your risk before you have spent a cent. Other forms of financial trading simply do not allow such easy access to all of the figures, and you need to rely on guesswork.
High rewards and fast returns
Expiry times for binary options are much shorter compared to more traditional financial trading methods. They can range from 15 minutes up to a week, where as more traditional forms are usually held longer, for months or years before you see any return on them. This ability to quickly trade in markets for a short period, combined with regularly high return rates (80%~95%), means that with a few quick successful trades you can make substantial profits.
Simple trading
Brokers have made trading binary options as simple as possible in order to speed up the process - from your initial deposit to advanced trading. There are only a few steps to selecting your option:
  • choose the financial asset you want to trade
  • select the amount you want to trade
  • choose the direction in which you think the index will go
  • select the expiry time
  • hit the button
  • ..sit back and wait for you option to expire
A few simple clicks and you are done. If the outcome of the trade is in your favour then you typically stand to gain a high profit.
Low initial investment
The ability for binary option traders to trade small amounts at a time makes it a greatly affordable way to trade online. Many brokers allow you to make small minimum trades from as little as $1 meaning you can trade as little or as much as you want. Initially it's wise to bet small amounts until you get to grips with it and only trade as much as you are willing or can afford to potentially lose.
Wide range of internationally traded assets
There are many financial assets that can be traded all over the world daily. This means that no matter what your preferred asset is or where your knowledge in the financial markets lies you should have the ability to select it for your options. Many binary options brokers offer different sets of assets that they allow you to trade so be sure to check each one carefully. Some brokers offer an extensive range of commodities, stocks, indices and currency pairs up to around 90 of them meaning you have your pick of assets to trade.
Trade on any market condition
We have mentioned traditional forms of financial trading and the limitations that they have, but one major advantage that binary options have over them is that you can not only make money when prices are rising (like traditional methods) but you also have the ability to make money when prices are falling. This opens up different trading strategies and a greater potential for of profits to be made. Keeping an eye on the financial markets and noticing any major fluctuations can put you in good stead when it comes to trading, either way.
Anywhere, any time
Binary option brokers have made their online trading platforms as accessible as possible, with many of them not only offering the conventional web based trading via your desktop or laptop, but also via your mobile. This means that you can trade on the move and check your options regularly and conveniently. Combine this with the fact that assets are internationally traded means that at least one market somewhere in the world will be open, making binary options trading a 24 hours a day 7 days a week affair. As you have read, there are many benefits to trading binary options online. It is a widely available, simple form of trading with fast, high returns on any trades you make - small or large. This makes it increasingly easy to start trading and potentially profiting. Just make sure that you are in control, and you too can benefit from trading binary options.

How to trade binary markets?

Trading binaries is remarkably easy, and requires only 3 simple steps:
Define your position
MarketDurationPayoutBarrier1
Get your price
PURCHASEPURCHASERiseFall2
Place your trade
BuySell3

Step 1: Define your position

First, you need to set the parameters of your trade. Here's what you need to consider.

Choose the market & underlying
  • Forex - trade all major FX currency pairs.
  • Indices - trade all major worldwide stock indices.
  • Commodities - trade major commodities such as gold and oil.
  • Random Indices - trade binary.com proprietary random indices.
In this example we have chosen "Indices" and the underlying Australian Index:

Choose a trade type
  • 1. Rise/Fall - predict if the market will rise or fall from its current level.
  • 2. Higher/Lower - predict if the market will end higher or lower than a price target.
  • 3. Touch/No Touch - predict if the market will touch or not touch a price target.
  • 4. In/Out - predict if the market will stay inside two price targets, or end between or outside them.
In this example we have chosen "Rise/Fall" strategy for the Australian Index:

Adjust trade parameters
You can set the length of your trade, from 10 seconds to 365 days. If you are in a hurry for immediate funds, there's no need to wait until expiry. You can sell back long-term trades at any time to profit from changing market conditions.
In this example we have chosen a future start time & a duration of "1 hour" as it suits our strategy:
This is further explained below.
Please note: the Markets And YOU trading platform software offers 1-click options for these settings.

Step 2: Get your price

Price is automatically calculated for you, using a preset return rate.

Step 3: Place your trade

Simply choose the Higher or Lower green "Purchase" button to purchase the trade.

Afterwards: Winning the contract

If you select "Rises", you win the payout if the exit spot is strictly higher than the entry spot.

If you select "Falls", you win the payout if the exit spot is strictly lower than the entry spot.

Entry spot

If you select a start time of "Now", the start time is when the contract is processed by the servers and the entry spot is the next tick thereafter.
If you select a start time in the future, the start time is that which is selected and the entry spot is the price in effect at that time.

In our example, we chose a future start time.


Exit spot

The exit spot is the spot at the end time.
If you select a start time of "Now", the end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).
If you select a specific end time, the end time is the selected time.
If you select a duration, the end time is the selected number of minutes/hours after the start time (if less than one day in duration), or at the end of the trading day (if one day or more in duration).

In our example, we chose a duration.


Overview of our example

  • Each binary trade is for a pre-determined payout amount.
  • You win the payout if your prediction is correct.
  • You can choose payouts from $1 to $100,000.
  • You can choose durations from 15mins to all-day.
  • This wide payout range & duration selection is ideal for both small and large traders.

Shown below is the complete panel from our example trade.

FAQ

Opening an account
Q: I'm new to binaries, where do I start?
A: The first step is to open an account. You can apply online in just a few minutes.

Q: Do I need to send any documents?
A: We don't usually require any documents as we can verify your identity online.
Financial Security
Q: How safe is my money with Binary.com?
A: Your money is always safe with Binary.com. At all times, it is held in segregated AAA-rated banks, which is a condition of our trading licenses.

Q: How does Binary.com make money?
A: Binary.com has thousands of clients taking a variety of positions on the financial markets at any one time, and earns a small margin on these trades.
Depositing and withdrawing funds
Q: Do I need to deposit any funds to open an account?
A: You don't need to deposit any money to open an account, but you need to deposit funds before you can start trading.

Q: How do I fund my account?
A: Binary.com offers a range of common deposit and withdrawal methods, from credit and debit cards to bank wires, e-cash and e-wallets.
Learning to trade
Q: Do you offer virtual-money accounts?
A: Binary.com offers a virtual-money account so you can get the hang of trading binaries. Why not open a free $10k fully-functional virtual-money account, and start learning how to trade.

Q: Will I need to install any software?
A: Binary.com is entirely web-based and requires no software installation.

Q: How soon can I start trading?
A: You can open an account, deposit funds and begin trading within minutes.

Glossary

Barrier(s)
The barrier of a binary option trade is the price target you set for the underlying. You can choose trades that stay below or go above a price target, or stay between two targets.
Binary option
A binary option is a contract purchased by a trader, which pays a pre-determined amount if their prediction is correct.
Commodities
Commodities are resources that are grown or extracted from the ground, such as silver, gold and oil. On Binary.com, they are priced in US dollars.
Contract period
The contract period is the time-frame of a trade. It is also called the duration.
Derivative
A derivative is a financial instrument whose value is determined by reference to an underlying market. Derivatives are commonly traded in the inter-bank market, and binaries are one of the simplest forms of derivatives.
Duration
The duration is the length of a purchased trade (see 'contract period').
Ends Between/Ends Outside trades
An Ends Between trade pays out if the market exit price is strictly higher than the low price target AND strictly lower than the high price target. An Ends Outside binary pays out if the market exit price is EITHER strictly higher than the high price target OR strictly lower than the low price target.
Entry spot price
The entry spot price is the starting price of the trade purchased by a trader.
Expiry price
The expiry price is the price of the underlying when the contract expires.
Forex
In foreign exchange markets, traders can enter contracts based on the change in price of one currency as it relates to another currency. For example if a trader selects Rise in the EUR/USD market, they are predicting that the value of the Euro will rise in relation to the value of the US dollar.
GMT
GMT stands for Greenwich Mean Time, the official time used in the UK during winter. In summer, the UK changes to British Summer Time, which is GMT + 1 hour. All times on the Binary.com site use GMT all year round.
Higher/Lower trades
These are trades where the trader predicts if a market will finish higher or lower than a specified price target.
Indices
Stock market indices measure the value of a selection of companies in the stock market.
In/Out trades
These are trades where the trader selects a low and high barrier, and predicts if the market will stay within these barriers or go outside them (see also 'Stays Between/Goes Outside trades').
Market exit price
The market exit price is the price in effect at the end of the contract period.
No Touch trades
These are trades where the trader selects a price target, and predicts that the market will never touch the target before the expiry of the trade.
(One) Touch trades
These are trades where the trader selects a price target, and predicts that the market will touch the target before the expiry of the trade.
Payout
The payout is the amount paid to an options trader if their prediction is correct.
Pip
Pip stands for 'percentage in point' which is generally the fourth decimal place (i.e. 0.0001).
Profit
The profit is the difference between the purchase price (the stake) and the payout on a winning trade.
Random Indices
The random index is a stock index whose price is simulated using random numbers. Unlike real market stock indices whose prices depend on the prices of the individual stocks listed on an Exchange, the random stock index only relies on factors like volatility, previous index price (previous simulated price) and a random number to determine the price of the index. Due to the use of random numbers, the price (or direction) of the index cannot be predicted with certainty and thus behaves like a real market index. When the index is appended with a number, the number is the percentage volatility used in calculating the index price. For instance, the Random Index 25 uses a volatility of 25% in the calculation of the index price. The index started at 1000 on 16 May 2004.
Resale price
The resale price indicates a contract's current market price. Resale prices are on a best-efforts basis and may not be available at all times after purchase. See 'Sell option' for more details on selling contracts before expiry.
Return
The return is the money realized when the contract expires (see 'Payout').
Rise/Fall trades
These are trades where the trader predicts if a market will rise or fall at the end of a selected time period.
Sell option
It is sometimes possible to sell an option before the expiry of a trade, but only if a fair price can be determined. If this option is available, you will see a blue 'Sell' button next to your trade in the portfolio.
Spot price
This is the current price at which an underlying can be bought or sold at a particular time.
Stake
The stake is the amount that a trader must pay to enter into a trade.
Stays Between/Goes Outside trades
A Stays Between trade pays out if the market stays between (does not touch) BOTH the high barrier or the low barrier at any time during the period chosen by a trader. A Goes Outside trade pays out if the market touches EITHER the high barrier or the low barrier at any time during the period chosen by a trader.
Tick
A tick is the minimum upward or downward movement in the price of a market.
Underlying
Each binary option is a prediction on the future movement of an underlying market.