Binary options trading are known as
such because there are basically two outcomes only: in the money and out of the
money. If it’s in the money, it means that the binary options trader correctly
predicted the direction of the price of his chosen underlying asset at the
expiration of the contract. Thus, he will receive the agreed payout. It’s out
of the money if he’s wrong in his prediction. Thus, he loses his capital or
investment. Oftentimes, binary options trading are also known as all-or-nothing
options trading or digital options trading.
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