If you use the web for financial and investment information you have probably seen some astounding advertisements promising astronomical short term investment opportunities. Some of the more recent claims are "up to 95% profit in one easy trade," "Earn up to 85% per trade," or "Win up to 88% per trade." Are these types of claims accurate? Does the world of binary options live up to the hype? We will explore this question in this report.
What is a binary option? Perhaps it is best to define the word 'option' first. An option is simply a financial contract where we agree to buy or sell some sort of asset at a certain price within a certain time frame. Options fall into the derivatives category because such a contract has a value without actually holding the underlying asset itself. For example, if you own an option contract for Apple or Google, that contract has value all by itself, despite the fact that you own no shares in the company. The mere fact that you have a contract to buy or sell shares in the future has a value in and of itself. Option contracts expire at some time in the future - minutes, hours, weeks, months or even years, depending upon the particulars of the contract. Upon expiration, an option contract becomes worthless. So those who invest in options must do something with them, buy or sell, sometime before they expire.
Disclaimer : Comments and suggestions on any part of this blog are opinions of the writer or Anonymous persons and they do not represent the opinions of Judy Kaze.
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ReplyDeleteIf you use the web for financial and investment information you have probably seen some astounding advertisements promising astronomical short term investment opportunities. Some of the more recent claims are "up to 95% profit in one easy trade," "Earn up to 85% per trade," or "Win up to 88% per trade." Are these types of claims accurate? Does the world of binary options live up to the hype? We will explore this question in this report.
What is a binary option? Perhaps it is best to define the word 'option' first. An option is simply a financial contract where we agree to buy or sell some sort of asset at a certain price within a certain time frame. Options fall into the derivatives category because such a contract has a value without actually holding the underlying asset itself. For example, if you own an option contract for Apple or Google, that contract has value all by itself, despite the fact that you own no shares in the company. The mere fact that you have a contract to buy or sell shares in the future has a value in and of itself. Option contracts expire at some time in the future - minutes, hours, weeks, months or even years, depending upon the particulars of the contract. Upon expiration, an option contract becomes worthless. So those who invest in options must do something with them, buy or sell, sometime before they expire.
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