Many investors still have basic questions about binary options. We decided to create this really simple infographic that presents the basics of binary options to help you understand this financial instrument. We tried to make it as simple and user-friendly as possible. This is thus a document for beginners that want to learn about the mechanism and specificities of binary options. We presented the advantages of these binary options, the way they work, the different available expiries, the different available assets and the way to trade them.
The basics of binary options
The below infographic only covers the basics of traditional binary options, the ones called High / Low options or Calls / Puts. There exist other binary option types that are more complex but that are only relevant for more experienced traders. If you want more information about more advanced options types (0-100 binary, one touch, boundary, range, no touch…) or trading tools, don’t hesitate to have a look at our dedicated articles that cover these themes in details. On this infographic, we thought it would be more clear and intuitive to present only the basics of traditional binary options. We hope you will find the below interesting and meaningful.
As you can see above, binary options are extremely simple. This is the single most important reason behind the success of binary options among retail investors. There are many other advantages with binary options (you can go short on any asset, you can trade all the different asset classes, you can generate way higher returns than with any other financial products…). Nevertheless, many investors want to trade such products without the necessary knowledge about financial markets. There are for example many beginners that still don’t understand the difference between forex and binary options. It is really simple. Forex is an asset class while a binary option is a financial instrument that enables you to leverage your investment on different asset classes (like forex or commodities for example).If you don’t know the basics presented above, we definitely recommend you to learn about binary options and financial markets before you put your money at risk.
Don’t hesitate to have a look at our Education section for further binary option tips and explanation along with the basics of financial markets. Feel also free to check our reviews and rankings of the best binary option brokers.