Binary options vs vanilla.
If you ask a professional trader about currency or trade binary options other asset options, he/she will assume you are talking about a vanilla option or some exotic form of it (e.g. one touch, trade binary options no touch, etc.). On the other hand, if you ask a retail trader about options, he/she will likely assume you are talking about binary options. What the two have most in common is the word options. This is where the similarity ends. What are binary options? A binary option gets its name from the term binary, which is the way computers store and calculate data. Computers use only two digits, zero and one. For example, zero = true and one = false so it is either one digit or the other. In binary options, there is also an either/or outcome, which means the option expires in the money (winner) or out of the money (loser). There is also a fixed payout for trade binary options ending in the money and a fixed cost when it ends out of the money so the buyer knows his/her risk or reward beforehand. Some say this is an all or nothing outcome although brokers may pay out a small percentage when the trade expires as a loser. Buyers of binary options are either looking for it to go up (call) or down (put) within a period specified at the time the trade is put on. The time is chosen at the time of the trade and can vary from as short as 30 seconds to as long as 24 hours. This means the buyer not only has to choose an entry price but also the direction and time the option will expire. What are vanilla options? Unlike its cousin in name only, trade binary options vanilla options do not have a fixed payout as prices are constantly changing as they are based on movements and volatility of the underlying asset as well as time decay to expiration. The buyer, however, can sell the option at any time before then to liquidate the position. A vanilla options price will approach the price of the underlying asset at the time of maturity. In addition, vanilla options can be sold as well, which entails different risks. While the buyer can only lose the cost of the option (i.e. the premium), the seller can lose more than the premium he/she would collect if the market moves through the strike price and then beyond. However, the seller can only earn the cost of the premium. So theoretically, a seller has unlimited risk and a limited reward while a buyer has a limited risk and unlimited reward. However, the time decay can work against the buyer, especially if volatility does not increase. Professional options writers (sellers) hedge the position to limit the outright risk but that is for another discussion. Why do retail traders prefer binary options? Retail forex traders generally prefer to trade binary options over vanilla options for several reasons. 1) Binary options are straightforward, easier to understand and trade, 2) Traders know their risk in advance so there is no need to constantly monitor the screens. 3) There is more flexibility in time frames for expirations. 4) Traders can get quicker results than in vanilla options, which generally have a longer time horizon. However, it is not a one way street as vanilla options offer a bigger upside while binary options have a fixed payout. In addition, there is the flexibility to be a buyer (owner) or a seller (writer) of a vanilla option although as noted, the latter entails more risk. In any case, retails traders seem to prefer binary options for the reasons cited above but should be treated as a business and not gambling, which is a subject for a future discussion.
Forex Trading News.
Forex Research.
Daily Forex Market News Forex news reports can be found on the forex research headlines page below. Here you will find real-time forex market news reports provided by respected contributors of currency trading information. Daily forex market news, weekly forex research and monthly forex news features can be found here.
Forex News Real-time forex market news reports and features providing other currency trading information can be accessed by clicking on any of the headlines below. At the top of the forex blog page you will find the latest forex trading information. Scroll down the page if you are looking for less recent currency trading information. Scroll to the bottom of fx blog headlines and trade binary options click on the link for past reports on forex. Currency world news reports from previous years can be found on the left sidebar under "FX Archives."
Actionable trading levels delivered LIVE to YOUR charts.
GVI Trading. Potential Price Risk Scale AA: Major, A: High, B: Medium.
Mon 27 May 2019 AA GB/US- Holiday Tue 28 May 2019 A 14:00 US- Consumer Confidence C 13:00 US- Case-Shiller Wed 29 May 2019 A 08:55 DE- Employment AA 18:00 US- BOC Decision A 18:30 US- EIA Crude Thu 30 Mar 2019 AA EZ/CH- Holiday A 12:30 US- Weekly Jobless Fri 31 Mar 2019 AA 10:00 EZ- Flash HICP A 12:30 US- Personal Income, Spending, Deflator AA 14:00 US- Final Univ of Michigan.
Global-View Affiliate Program.
We are starting an affiliate program to market some of our products.
Send me an email if you would be interested or if you know someone who would like to be an affiliate. Generous commissions payout for those accepted.
Put the word "affiliate" in the email subject line.
TRADER ADVOCACY ARTICLES.
Are you looking for your first broker or do you need of a new one? There are more critical things to consider than you might have thought.
We were trading long before there were online brokers. Global-View has been directly involved with the industry since its infancy. We've seen everything and are up-to-data with recent regulatory changes.
If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.
Live rates, currency news, fx charts.
Research reports and currency forecasts.
Foreign Exchange database and history.
Weekly economic calendar.
Trading Forums Currency Forum Guide Forum Directory Political Forum Forex Brokers Compare Forex Brokers Forex Broker News Forex Broker Hotline.
Forex Forum.
Forex News.
Currency Trading.
Forex Brokers.
Forex Trading.
FX Trading.
Forex Blog.
By using this website, you are agreeing to our Privacy Policy and Terms of Use, and Cookie Policy.
Copyright ©1996-2021 Global Viewpoint, Inc. All Rights Reserved. Hosting and Development by Blue 105.