Types of Binary Options Trading

What are Binary Options?

Binary Options is a kind of option where the payoff is a fixed amount of some sort. This is usually a European style investing option. In the American Stock Exchange these are known as Fixed Return Options or FRO. There are two main types of binary options:

Cash-or-Nothing Binary Option:

This type of binary options pays some kind of fixed amount of cash even if the option expires in terms of money.

Asset-or-Nothing Binary Option:

This type of binary options only pays the underlying security value of the asset when the option expires in terms of money.

Binary Options are considered to be a simple and fast way to take a view on stocks, commodities, indexes and economic events that have a very limited risk factor.

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