When you decide to trade Binary Options, you should know that there are many different types of Binary Options you can choose when trading online. So here are some important characteristics that will introduce you and will make you understand the types of Binary Options available on the market.
Commodity Binary Options are a very popular type of Binary Options, based on commodities, that allow trading on the values of fixed commodities, not being necessary to buy those assets. Some popular commodities that these options are based on may be the values of Silver, Gold, Oil and Copper, in a particular period of time. So this type of options are very popular over the world especially because they allow you to make profit without buying and then selling these expensive commodities.
Currency Binary Options are based on two different currencies traded against each other. This type of options became very popular because of many reasons: whether the traders want to make a profit as part of their daily trading strategy, or they want to hedge the physical currency purchases they made. You can choose to pair up the major currencies as US Dollars, Australian and Canadian Dollars or UK Pounds Sterling, but in fact there are no limits to pairing together any two currencies.
Indices Binary Options are one of the most traded and refer to your predictions of the values of the top rated stocks and shares of a particular Stock Exchange. So you predict if the value will be higher or lower than it is when you place the trade, over a fixed period of time. You can place trades on any Stock Indices, but the most popular are Dow Jones, FTSE 100, DAX and NASDAQ. Indices Binary Options are attractive because you don’t have to buy the stocks and shares that make up the indices and you don’t have to pay fees and commissions for brokers.
Individual Stock Binary Options are based on trading thousands of different stocks and shares without buying them. The most traded stocks are from well known companies like Microsoft, Toyota and Vodafone, but also share prices of Twitter and Facebook.
These being the alternatives of Binary Options, any trader can make his own choice depending on his preferences, but also on the risks and the advantages of every type of option.