Prepare a system of trading that suits you and adhere to the system, follow discipline and never overtrade, options will make money for you. An option is a sort of contract which gives the buyer a right (not an obligation) to buy or sell an underlying instrument at a specified price, which is known as “strike price”, and within a specified time, which is termed as “expiry period”. Intrinsic value is the difference between the market value of the security and strike price of the option.
When a trader expects the price of a security to rise he places a call option, but if he feels that prices will fall he places a put option.


The primary difference between a binary option trading and ordinary trading is that under the latter one becomes the owner of the asset and can be held as long he desires to hold them as against the former where one trades on the differences in the price of the asset. These options can be used to hedge your contract, if you find that your contract is already out of money you can use binary options to lock your gains. These options seem quite impressive to new comers who ignore all trading discipline and overtrade without a proper system and hence pile up losses for themselves. Basically time value represents the difference in expected value of the option on the expiry date.





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Comments

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    08.05.2015

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    08.05.2015

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    08.05.2015

  4. ZAKIR212

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    08.05.2015