Assets or Underlying Assets
Assets or Underlying Assets are different currency pairs like USD/GBP, EUR/USDetc, commodities such as OIL, GOLD etc, stocks like BMW, Facebook etc and indices like NASDAQ, BSE etc which a trader can trade on or place investment on.
At the money
If a trade, Call or Put, ends with the value of asset not being changed or altered from its original value the trade is said to end “At the Money”. For example, if an asset traded value of 45.874 ends with the asset still being at 45.874 at the expiration time, it is called “At the Money”.
When a trader places an investment forecasting the upward movement of an asset it is called “Call” option. Selecting “Call” option means predicting that at the time of expiry, the value of an underlying asset would rise or exceed from its current value.
Commodities are basically raw materials that can be traded as an asset in financial market like Binary Options Trading. These include Coffee, Oil, Wheat, Gold, Silver etc.
Currency Pairsrefer to the value of one currency against another currency, which are traded in the world financial markets. Traders can choose from different currency pairs such as USD/EUR, USD/GBP, GBP/JPY and more.
Current Price is the value of an asset at the time of selecting the Call or Put option for trading that particular asset.
Binary Option is also known as Digital Option.
The time at which a trade expires and the value of an asset is compared against the Strike price to establish the trade payout is called ‘Expiry Time’. Every trader selects an expiry time while making an investment on an asset and this expiry time could vary from 60 seconds, 45 minutes, one hour and so on.
In the Money
If the trade ends with the asset value going towards the predicted direction, the trade is said to be ended “In the Money”. For example, if a Call trade ends with value of asset rising or a Put trade ends with value of asset decreasing; it is called “In the Money”.
A grouping of stock data including a company’s productivity, financial growth, prices and performance. Examples of popular indices are NASDAQ, Dow Jones, BSE etc.
No Touch is trading product in which if the value of a selected asset does not touch a predicted target value, before the expiry of the trade, it expires in the money. If the value of asset managed to touch the target value the trade expires out of the money.
Out of the money
If the trade ends with the asset value going against the predicted direction, the trade is said to be ended “Out of the Money”. For example, if a Call trade ends with value of asset falling or a Put trade ends with value of asset rising; it is called “Out of the Money”.
The money earned or won from a trade or investment made in a trade.
When a trader places an investment forecasting the downward movement of an asset, it is called “Put” option. Selecting “Put” option means predicting that at the time of expiry, the value of an underlying asset would fall or decrease from its current value.
Stock in Binary Options refers to trading stock of companies that are traded everyday in the financial market. International companies like BMW, Twitter, Apple and many more put their stocks in the market.
Strike Price is the value of an asset or an underlying asset at the time when the investment is made. Trading brokers and traders compare the value of an asset at the time of expiry with the Strike price, to conclude if the asset has “expired in the money” or “expired out of the money”.
Touch Option is a trading product in which if the value of an asset touches a predicted target value, before the time of expiry, the trade expires in the money. If the asset value fails to touch or surpass the target value it expires out of the money.
Underlying Asset Types
There are 4 types of underlying assets – Stocks, Commodities, Indices and Currencies.