Calculations

Calculation of Binary Options expiration rates

Many regulated in binary option brokers have a part of their binary option trading platform dedicated to "expiration rate". Some also call it "time-outs" or "expiry level". This is the official rate when the various binary options reach maturity.
Not to lie to the traders, binary option broker regulated based on data of the largest flow providers such as Reuters or Bloomberg. This is particularly true of, which is based on the official courses provided by Reuters or Bloomberg to determine the rate at expiration time T. Is known that the most trading platforms also use the same streams.

Calculation of expiration rate in binary option

However, in financial markets, there is no "real" price for an asset, but still a fork (bid/ask) with a purchase price and sales price. In relation to this, it is the broker who will choose the formula for calculating the expiry level of the binary option. Some use the simple formula: [bid + ask] / 2 (= the middle of spread).

Which is easier? Forex or Binary Options?

Is Binary Option easier than Forex?

When one is not familiar with the financial markets, it is legitimate to ask whether the binary option is easier than forex or not. From a purely theoretical point of view, yes the binary option is easier to understand. Indeed, the description of this financial instrument  is very clear and the potential gains are fixed from the start. For forex, gains are not set at the beginning, and there is no date. In short, there is much to appreciate the binary option for the fact that it is much easier to deal with (the 4 parameters are set in advance: management, amount, maturity and potential gain), while the forex remains unclear.

Binary Option is easier than forex

The definition of the binary option is easy to understand

For those who want to get into the financial markets, the binary option is ideal because it is simple to understand. No need to have trading concepts, the product is easy to handle. However, we must not overlook the risks around it. If the investor has the wrong direction, it loses all of his stake. However, again, it is less risky than the forex that can potentially lose more than what you invested.
In all cases, the comparison between forex and binary option  goes in the direction of the former. This is also why it is gaining much popularity in recent times, while the foreign exchange market loses in number of active traders. It is also one of the reasons why forex brokers gently to launch the binary option, particularly on the rise. However, the pure players have gone already so far ahead so it will be difficult for foreign exchange brokers to corner the market.

Forex vs. Binary Options

Difference between Forex and Binary Options

On many forums available on the internet, inexperienced investors ask the difference between the forex and binary options. If users can often see advertisements on these types of investments, they do not yet have any connection between them. For a gardener, this would compare apples and pears. After comparing the binary options with conventional options, here's a new comparison.

Differences

To enable you to understand the difference, we will return to the definitions of the two:

• Forex (short for "Forex Exchange" ) is a market. An investor who deals with the "Forex" is active in the foreign exchange market only (euro/dollar ...). It can directly invest in the underlying asset (EUR/USD, ...), or invest in derivatives (options ...). It may even possibly deal with binary options they have for the conditions underlying currency!
• Binary options are a type of investment : they are available on different underlying (Forex, commodities, equities) and help create an important leverage and can generate very attractive returns. It is a derivative whose value is the underlying derivative. Note that in most cases, you can not exit a position binary options (it takes maturity, also known as "maturity").