1.3 Strategy Binary Options

IQ Pick Binary vs Digital Options, which is better? Today we compare the performance and characteristics of option instruments on the IQ Option platform. Find out how binary and digital options differ.

binary-and-digital-options

Contents

  • 1
    Binary vs digital options wiki Q&A

    • 1.i
      What is an option
    • 1.two
      Binary option trading on IQ Pick
    • 1.3
      Digital options trading on IQ Pick
  • two
    Similarities betwixt binary option and digital option nugget types on IQ Option
  • 3
    What is the difference between binary and digital trading in IQ Option?
  • 4
    Trading binary pick on IQ Option
  • v
    How Do Digital Options Work on IQ Selection
  • half-dozen
    Binary vs digital options, which to choose?

Binary vs digital options wiki Q&A

IQ Option is one of the few online brokers that has managed to attract millions of traders from across the globe over a curt amount of time. The master reason for this is their innovation and introduction of new features and instruments. Ane of their latest introduction is digital options trading.

This guide will await at both binary options and digital options. These are financial instruments offered past IQ Option.

What is an option

An Option is function of the derivatives types of assets. This means that their value is intrinsically tied to the value of an underlying asset.

When y’all purchase or sell an selection, you do not own the underlying nugget. Y’all’re typically speculating on whether the asset’southward cost volition become upwardly or autumn over a specified period. Upon trade expiry, you will either earn a turn a profit or incur a loss.

The profit is commonly calculated every bit a percentage of your trade investment. The total amount you could lose is your trade investment amount. However, some brokers such every bit IQ Option will allow you to exit the position before the selection expires.

Binary option trading on IQ Option

Also popularly known equally a loftier-low pick, binary options trading involves speculating whether the price of an asset will rise or fall over a given amount of time. Your trade entry marks the strike cost.

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If you anticipate that the option volition expire when the price is higher than this, all you lot need to exercise is enter a higher position. The trade expiry is always predetermined. On the IQ Option platform, this ranges from one infinitesimal to 1 calendar month.

IQ Pick binary trades ever accept a fixed return which is calculated equally a percentage of the trade investment. The return you receive depends on the nugget being traded and market place volatility.

Digital options trading on IQ Option

The digital option combines the power of the binary pick and the increase in the cost of the underlying asset. So rather than have a fixed return, the render for a digital option is calculated based on how far away the price moves from the strike price.

The farther away from the price moves, the college the return. This means that yous tin potentially earn up to 900% return on investment when trading digital options. The trade expiry for the digital option is 1 infinitesimal, v minutes and 15 minutes on the IQ Pick platform.

Similarities between binary option and digital selection asset types on IQ Option

Both option types have a predetermined expiry. Once the expiry period is reached, the position is automatically airtight. The merchandise expiry for both is indicated by a vertical cherry-red line on your chart.

trade expiry line

Both option types require you predict whether the price volition be higher or lower than the strike price on trade expiry.

IQ Option offers binary option and digital pick for currency pairs and bolt. In terms of the number of avails available in the binary vs digital options battle, the former offers about 2 times as many avails available for trading.

What is the difference between binary and digital trading in IQ Option?

Binary options trading is dependent on the management of the price relative to the strike cost. That is, whether the price will be higher or lower than the strike price at trade death.

Digital options trading on the other paw is dependent on both the management and the price altitude from the strike cost. That is whether the price volition be college or lower too as how far away the toll will exist at trade death.

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The return for binary options trading is fixed and predetermined at trade entry. The render for digital options trading on the other paw fluctuates as long equally the trade remains open.

With binary options trading, the maximum amount you tin lose is your merchandise investment. With digital selection trading, your losses tin exist higher than your trade investment. The further away the prices movement from your prediction, the higher your percentage loss.

Binary Options have expiry periods ranging from ane minute to 1 month. The digital choice on the other hand has trade expiry periods lasting 1 minute, 5 minutes or 15 minutes.

Binary vs Digital options do not have that many significant differences. Often the strategy used volition decide which instrument you use. A uncomplicated case: If your method involves opening an option for an hour, digital options are out of the question considering their longest expiry time is 15 minutes.

Trading binary option on IQ Choice

Once you lot’ve logged into your trading account, click on the select assets characteristic (plus sign at the acme of your trading interface).

binary option choosing instrument

Side by side, select options and then binary. Choose the nugget pair you desire to trade with. Use a Japanese candle chart with 5-infinitesimal interval candles.

setting up binary option to trade

Subsequently analyzing the chart, enter the amount y’all desire to trade. Next, enter the merchandise expiry. While using v-minute candles, the minimum expiry should be 5 minutes.

You lot can acquire more about trading candles in The Ultimate Guide for Trading Candles on IQ Selection.

How Do Digital Options Work on IQ Option

Once you’ve logged into your IQ Pick account, click on the select avails feature. Click on options and and so select digital. Next, choose the avails you lot want to trade with.

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digital option choosing instrument

Fix a Japanese candle chart with 5-minute interval candles.

At the right of your chart, you lot’ll see sets of boxes with prices in them. If yous hover your cursor over these boxes, you’ll observe that the higher and lower buttons accept possible percentage profits yous tin can earn. For instance, if the college push shows a +250% profit, it simply means that you can make this amount if the price is higher than the strike price (price cursor is at) upon trade decease.

setting up digital option to trade

Once you’ve analyzed the chart and determined the direction the toll will have, follow these steps:

  1. Select the strike toll
  2. Enter your merchandise amount
  3. Select the trade expiry
  4. Select direction (college or lower)

Binary vs digital options, which to choose?

As you’ve seen, binary options and digital options take similarities and differences. Digital options have a college risk-return compared to binary options. Now that you’ve learned about both, attempt them out in your IQ Option do account today. We’d love it if you share your experience in the comments department beneath.

Good luck!


General Risk Alert: The financial products offered by the company carry a loftier level of risk and can result in the loss of all your funds. You should never invest money that you cannot beget to lose


Fulltime Day trading, and help Iq option wiki in my spare time to build an awesome platform to help beginners out there. #digital-nomad, traveling all over the earth. https://www.instagram.com/bart_bregman/

Source: https://www.iqoptionwiki.com/binary-options-vs-digital-options/

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