Classic options are the most well known and simplest type of binary options available today. That is why they are called Classic Options as they are the most commonly known and most traded type of binary options. They are also referred to as Digital/High-Low/Up-Down/Above-Below options.
When trading the classic binary option, you have to determine whether the price of an asset will move above or below (higher or lower) a predetermined strike price by the time of expiration. For example, if a trader is trading in gold, they must determine if the price of gold will increase or decrease before the time of expiration for e.g. in 1 hour from now.
After conducting some basic analysis, the trader decides that they think the price of gold will increase in one hour and they purchase a Call option. On the other hand, if the trader decides that the price of gold will drop before the time of expiration, they will purchase a Put option.
From the onset, the trader knows how much money they can win or lose. This makes it easy for traders to manage their risk and calculate their gains thoroughly before ever putting a penny on an option.
There are also many popular Digital options strategies that investors and traders can learn in order to increase their chances of being in-the-money.
Close Now enables traders to buy an option before the time of expiration. This could be helpful if you believe that your option is not performing as you expected and the asset you chose is not moving in the direction you predicted. For example, if you bought a one hour Call option with gold, and after 50 minutes you see that gold is steadily increasing, you could close the option before the time of expiration to insure that you’ll make a profit. On the other hand, if the price of gold started to decrease, you could close the option before the time of expiration to minimize your risk.
Option Banque‘s unique rollover feature enables traders to extend the expiration date/time of an option so that you can increase the possibility that your option will be in-the-money. For example, if you purchased a one hour Put option on gold, and five minutes before the time of expiration you notice that the price of gold has still not decreased like you anticipated. You could use the Extend tool to extend the time of expiration and give the option the opportunity to be in-the-money.