A binary option is a moving market where traders make money by speculating the direction of an asset’s value. The trading depends on the simple outcome of “yes” and “no”.
To accurately predict the price movement, a trader needs to have a thorough knowledge of the market and the asset they are trading in. If they have correctly predicted the price, the trade will be In The Money. Otherwise, it will be Out Of The Money.
Returns in Binary Options trading
For the wrong speculation, traders can lose all of their invested amounts. But if they have correctly predicted the direction of price movement of a given asset, they can get a fixed amount of return from the binary options market.
How do Binary Options returns work?
To trade in the binary options market, you simply have to analyze whether the price of an asset will be inside the given strike price or not.
While there are different binary options trading tools, traders have to predict the trend of an asset’s value in almost all of them.
If the speculation is incorrect and you have taken a position in the market, you will get no money. On the flip side, if you have correctly analyzed the market and understood the market trends,
you can predict the direction of an asset’s price.
To get a fixed return from the binary options market, it’s important to understand the market thoroughly. You can also take the help of a trading tool to learn the direction of price movement.
This way, you can accurately predict and trade to get a fixed return.
Read other important articles in the binary glossary.