Buyer’s option, seller’s option — what is it?
An option is both a contract and a security at the same time. The securities market implies the existence of relationships between two parties — “buyer and seller.” In addition, the classification of the document also distinguishes the concepts of buyer and seller, but in this case, such a designation applies only to one party to the contract — the holder of the security. As a result, both the seller’s option and the buyer’s option are two types of the same document.
More and more often on the internet you can find the opinion that binary options are a scam. This view is mainly held by those who have only participated in binary options once or have heard little about them. So, let us figure it out: are binary options really a scam?
If we answer the question of what options expiration is in simple terms, this term refers to the moment when this security ceases to be valid. At this time, the holder must decide whether to exercise the right to buy or sell the agreed asset at a fixed price or simply let the contract expire.
For those who are familiar with such a financial instrument as an option, the term “issuer’s option” will also be understandable. In general, it does not differ much from the usual understanding of this security, except for several nuances. An issuer’s option is a registered security; it is issued only by joint-stock companies and is regulated by the state.
Initially, the word “option” referred only to a type of security. Such instruments are the central object of buying and selling, which means they have their own price. It seems simple, but the option price is a concept that cannot be called a price in the usual sense. An option is both a service and a product at the same time. This is what defines the main specificity of this type of security.
Options are divided into two main types — call and put. Both have different meanings and applications and can apply to both standard and binary options. A call option is a very popular instrument on the financial market. Traders (market participants who strive for and earn profit not from the fact of buying or selling, but from the trading process itself) most often use call options when working in the options market.
Options are a type of security whose holder has the right to buy or sell the underlying asset at a fixed price within an agreed period. The holder is not obliged to perform the agreed action and may choose whether to exercise the option or not. The seller, on the contrary, bears an obligation that cannot be refused. Nevertheless, contrary to what it may seem at first glance, such a contract is beneficial for both parties...
When learning about traders who trade binary options and make good profits from it, beginners inevitably think that they have some kind of secret, since it seems impossible to make money just by sitting at a computer desk. In fact, it is possible, but there is no secret here — only clear rules that successful traders follow. Perhaps these very rules are the “secret information” that inexperienced players are chasing. So, what is this “binary secret”?
On the securities exchange, there are such concepts as options and futures. They have much in common and only one serious difference, which is why the terms are often confused. To understand what options and futures are, you need to learn their differences as well as specific examples of use.
In Russia and the CIS countries, the popularity of digital trading is gradually growing: more and more people are becoming interested in this type of earning. Against the background of the widespread popularity of the Forex market, more accessible and understandable financial instruments remain in the shadows. For example, few people know what binary options are, yet such trading can bring investors up to 85% profit.