Binary options are growing in popularity as the options trading choice right now. Traders choose binary options because of their simplicity and because they allow for traders to know in advance what their profit or loss is likely to be. Binary options offer one of two types of fixed outcomes – either a fixed profit or a fixed loss known as ‘up’ or ‘down’ outcomes.

Binary options are also known as ‘all or nothing’ options, digital options and fixed return options depending on which stock exchange you choose to trade with.
There are two main types of binary options. These are the ‘cash or nothing’ and the ‘asset or nothing’ binary options that offer either a fixed amount of cash reward to the buyer or the value of the underlying security depending on which one of these they choose.

A binary options trader can buy a binary option on almost any financial product and can select a fixed expiry time which can be as short as 15 minutes or less in some cases. Once a binary option is bought, it can’t be sold before the expiry time has lapsed but with such short time frames this is unlikely to be problematic for traders.