A binary option is a financial instrument based on a simple yes or no question where the payoff is a fixed amount or nothing at all.
This means binary options offer defined risk and clear outcomes on every trade.
Each binary option trade starts with a question - will this market be above this price at this time? If the answer is yes, you can buy the option. If it’s no, then you can sell the option.
The price of a binary is always between $0 and $100, and just like in other markets, there is a bid and ask price.
The binary options we offer are always built the same way. Each trade is easy to understand.
If you think about it, binary options reflect the way we think about things in our daily life. Things either happen or they don’t. With a binary option, payouts reflect that and are always all or nothing at expiration. You’ll find we like to keep trading simple.
You can also close a position early to lock in profits or limit losses.
As an active trader, we know you are busy scanning markets each day. You are dealing with complexity all the time. The last thing you need is to be slowed down with more complications and hard to understand details with a brokerage.
So we built an innovative full service exchange to trade binary options that lets you do just that.
How do binary options work?
There are three concepts to learning more about how binary options work; the underlying market, strike price and time to expiration.
Become familiar with those three concepts and you’ll understand the basics of binary options.
Let’s walk through the three parts of each binary option trade:
With binary options the amount you pay is the maximum you can lose. Because of that we say your risk is capped.
Maybe you don’t want to wait until expiration. You can place an order to close your position to limit loss or lock in profit early.
Along with offering clear outcomes and defined risk, we also designed our binary options to work in a way that offers unique leverage that enables opportunities to profit even from small market movements.
1 The first step is to pick the assets or event you want to trade. Each one is based on an underlying market and your trade is based on that underlying markets price movement.
2 Then you want to find a strike price that works for you. The strike is the price level you think the market will be above or below at expiration.
3 When opening a trade you will select an expiration day and time. The expiration is the moment of truth traders live for. This is when trading is over and the value of your binary option is determined.
How risky are binary options?
You always know your binary option risk reward ratio before you enter into a new trade. Your trade is fully paid for up front, which means you will never lose more than you pay. You always know exactly what you have at risk.
Trading also offers the opportunity to profit. Just like you know what you have at risk, you will enter each trade knowing your maximum potential reward.
We’re serious about helping you understand and limit your risk. Our goal is to let you define and understand it clearly and upfront on every trade.
It’s why we’ve worked to design and offer an innovative way to define and cap risk while also providing an affordable way to trade.
You can start with one contract at a time for less than $100, and decide your maximum risk and reward up front when you set up the trade.
Here’s how that works:
If you buy a binary option contract for $30, hoping to have it end at $100, your profit target is $70. This is $100 less your $30 investment. A loss would never be more than $30 no matter how much the market moves.
We think that hard to understand margin requirements, complicated fees and confusing payout structures can make trading riskier than it needs to be.
You can make those things part of your past by trading binary options with us.
Trading involves risk. It wouldn’t be exciting if it didn’t.
That’s why we offer a revolutionary approach to trading for the active short-term trader with Nadex Binary Options.
Nadex Binary Options are financial instruments that turns every trade into a simple question: will this market be above this price at this time.
If you think ‘Yes’, you buy. If you think ‘No’, you sell.
With you controlling the risk, binary options offer defined risk and clear outcomes before you place your trade.
No matter your skill level, Nadex Binary Options provide all the excitement you can handle combined with all the control you need. We give you the flexibility to consider multiple time frames, hold contracts to expiration, or close trades early to lock in profits or limit losses.
As with all our unique contracts, you control your risk with a maximum defined risk/reward on every trade.
Risk defined at the start of the trade
Limitless Trading Opportunities
No pattern day trader rule trade as much as you want
Trading intra-day, daily or weekly provides unique opportunities
ASIC,CySEC,Financial Conduct Authority,CTFC regulated exchange
Small market moves offer big opportunities
StraightforwardSimple yet powerful trading instrument