A binary options trading is a simple way to trade price fluctuations in multiple global markets. This is a user friendly trading platform and the whole system relies on two outcomes, “Win” and “Loss”. And before starting to go with binary option fundamental terms of Binary Options.
Before starting your journey in binary options trading you need to know about some basic terms of Binary options. In this article, I will explore 10 fundamental Binary Options Terms.

10 Fundamental terms of Binary Options


Call: A Call option predicts that the market price of the underlying asset will be higher than it was at the time you have placed the trade. It means that, you are hoping that the value of your chosen asset will end up with higher price than it started.


Put: A Put option predicts that the price of the asset will decrease at the expiry of the option’s time frame. It means, you are hoping that the value of your chosen asset is going to be lower at the end of the trading period than it was when it started. And if it does then you will have made a winning trade and will therefore be in profit on that single trade.


In the Money: A call option is said to be in the money when the current market price of the stock is above the strike price of the call option. It is regarded as “in the money” because the holder of the call has the right to buy the stock below its current market price. A Put option is said to be in the money if the current market price of the stock would be below the strike price of the put option.


Out the Money: A call option is said to be out of the money if the current price of the underlying stock is below the strike price of the stock. A put option is said to be out of the money if the current price of the underlying stock is above the strike price of the option.


Assets: An underlying asset is a security on which a trader can invest their money to earn profits from the markets. In binary options, there are different types of assets are available including Stocks, Commodities, Indices and Currencies.


Expiry Time: An expiry time is the specific time where the trader wants to close a particular trade. It means the expiration of the current trade that is being placed. A trader has to set the expiry time before placing the trade for the underlying asset.


% of Return: It means the percentage of the gain or loss of a particular trade. This is a simple calculation to justify the ratio of your success according to your prediction.


Minimum Bid: Minimum bid rate means the minimal buying cost of an underlying asset for a trader. Generally, the minimum bid amount of an asset is fixed by the broker and you have to bid according to the minimum bid set by the broker.


Broker: A broker is a person or an agency or an intermediary who have a license to perform commercial negotiations or transaction. In fact, if a trader wants to trade online the he trader must have to open a trading account under any reliable broker.


Trader: A trader is a person who invests money on a particular asset. The intention of the trader is to earn maximum from the trading markets. So, basically we can say that, a trader is an investor.

It is essential for a trader to grow their trading skills and strategies. And if you want to be a successful trader, you need to have a good knowledge about the basic terms of Binary options. If you have enough knowledge about binary options terms, you will be able to understand the advanced terms very easy. So, at the beginning give much time to learn the fundamental terms of binary options.

Terms of Binary OptionsTerms of Binary Options

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