In some articles and forums, you can come across the interesting term “vanilla option.” It is especially often contrasted with binary options or seen in phrases like “binary options originated from vanilla options.” But few people can actually explain what it means. This gap in knowledge needs to be urgently filled.

  As is known, options are a type of security, and all securities can be divided into exchange-traded and over-the-counter. Exchange-traded options are mostly purchased by individuals whose main goal is to earn as much profit as possible through trading without making large investments. Over-the-counter options are a more global financial instrument, typically used by large companies. Let’s take a closer look.