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Binary options are a type of financial derivative that allow investors to make all-or-nothing bets on events and asset price movements, and their popularity has grown dramatically in recent years. But critics, including U.S.
Binary options are a type of financial derivative that allow investors to make all-or-nothing bets on events and asset price movements, and their popularity has grown dramatically in recent years. But critics, including U.S. regulators who have long warned investors, say the transactions are more akin to gambling than investing and present a high risk of fraud and loss for unsuspecting consumers.
The outcome of these options is based on a "yes or no" proposition, hence the name "binary". If a binary option expires "in the money," the trader will make a profit; if it expires "out of the money," the trader will lose their investment. In 2008, the U.S. Securities and Exchange Commission (SEC) approved binary options for trading on exchanges. Since then, the Chicago Board Options Exchange and the North American Derivatives Exchange (Nadex) have provided standardized binary options to retail traders.
Although trading is available on regulated exchanges, the majority of binary options trading in the United States is still conducted through unregulated offshore platforms, resulting in many scams. [1] Binary options are banned in many places around the world, including Australia, Canada, Europe, the United Kingdom, and more. [3]
Binary options have an expiration date and time. When expiration occurs, the price of the underlying asset or event must be on the right side of the execution price set by the exchange for the trader to profit.
Binary options execute automatically, meaning that when the option expires, the profit or loss from the trade is credited to the trader's account. This means that investors who purchase binary options will either gain or lose their entire investment in the trade – there is no in-between.
For example, assume that ABC's stock price will exceed
<!-- @@@ -->25 and are willing to bet on this trade
<!-- @@@ -->25, traders will be paid according to the agreed terms. For example, if the payout ratio is 70%, the binary options broker will pay the trader’s account
<!-- @@@ -->2,500. [5]
Plain American options give the holder the right to buy or sell the underlying asset at a specified price on or before the option's expiration date. European options are the same, but the trader can only exercise the right on the expiration date. Ordinary options, or options as they are called, give the buyer potential ownership of an underlying asset. When buying these options, traders have a preset risk, but the profit depends on how much the price of the underlying asset moves.
Binary options differ in that they do not offer the possibility to take a position on the underlying asset. In this regard, they are purely speculative. Binary options usually set a fixed maximum payout, while the maximum risk is limited to the amount invested in the option. The underlying "assets" can be prices and events. Some binary options can be closed before expiration, but this will usually reduce the payout received (if the option is "in the money").
Binary options are occasionally traded on platforms regulated by the SEC and other agencies, but most binary options trading occurs outside the United States and is not regulated by U.S. officials. Unregulated binary options brokers are not required to meet specific standards or any standards. Therefore, investors should be very wary of potential scams. In contrast, vanilla options trade on regulated U.S. exchanges and follow the rules of the U.S. options market. [6]
When purchasing binary options, follow these steps:
When trading binary options, you should be aware of potential scam risks. It is important to point out that many binary options platforms operate outside of unregulated financial markets. This lack of regulation can lead to a higher risk of fraud because of the lack of regulation. [11] Once a scam occurs, you are often left very alone.
You must conduct thorough research, verify the regulatory status of the broker, approach binary options trading with caution, and fully understand the risks and potential scams.
An example is that the entry price of binary options represents the potential profit or loss, and the expiration value of all options is
<!-- @@@ -->Assume that Colgate-Palmoriff (CL) stock is trading at
<!-- @@@ -->65, expires at noon tomorrow. Traders can
<!-- @@@ -->65, then the option expires "in the money" and the value
<!-- @@@ -->60 profit (
<!-- @@@ -->40).
If the price of Colgate at option expiration is less than
<!-- @@@ -->120 and increases the profit potential to $180.
This typically includes selecting a broker, submitting an application, filling out a client identity verification form, funding the account, and verifying your identity for the broker. [4]
Binary options are considered high risk due to their all-or-nothing payouts, short-term speculative nature, volatility and the leverage involved.
Therefore, you should be cautious when approaching binary options, fully understand the associated risks, and develop a trading strategy with risk management measures. It is crucial to use a regulated and reputable broker to reduce these risks.
Much depends on market conditions and the event or asset involved. The best trading times are related to the product's volatility, economic events, data releases and market liquidity. [4]
Binary options are financial derivatives that offer traders a fixed return or no return based on the outcome of a "yes or no" proposition. Traders bet that the price of an underlying asset will be above or below a certain level at a specific time, resulting in two clear outcomes: a predetermined gain or a total loss of the amount invested.
When the underlying asset is a financial instrument, traders participate in the market in unique ways. However, they pose significant risks, primarily due to their all-or-nothing nature and the presence of a large number of unregulated platforms. Therefore, before putting money into the market by trading binary options, it is best to fully understand the market conditions, develop a sound trading strategy, and clearly understand the associated risks.
[1] Financial Industry Regulatory Authority. "Binary Options: These All-Or-Nothing Options Are All-Too-Often Fraudulent."
[2] Commodity Futures Trading Commission. "The Truth Behind Binary Options Fraud."
[3] Finance Magnates. "CME’s Event Contracts: Are Binary Options Back?"
[4] Abe Cofnas. Trading Binary Options: Strategies and Tactics. John Wiley & Sons, 2016. Chapter 1.
[5] Nadex. "Position Limits."
[6] U.S. Securities and Exchange Commission. "Binary Options and Fraud," Pages 1-4.
[7] CFTC, "Beware of Binary Options Mobile Apps"
[8] Federal Bureau of Investigation. "Binary Options Fraud."
[9] Securities Administrators of Canada. "Binary Options Fraud."
[10] Commodity Futures Trading Commission. "Beware of Binary Options Mobile Apps."
[11] SEC, Office of Investor Education and Advocacy, "Investor Alert Binary Options and Fraud"
TheQuantHackers is a cutting-edge community composed of a group of people from the world's top universities and quantitative finance practitioners, dedicated to exploring the infinite possibilities in the fields of artificial intelligence (AI) and quantification (Quant). Our team members come from world-renowned universities such as the University of Cambridge, Oxford University, Harvard University, ETH Zurich, Peking University, and the University of Science and Technology of China. Our external consultants come from first-class companies such as Microsoft, HSBC, Citadel, Man Group, Citi, Jump Trading, and top domestic private equity companies.25，并愿意在此交易上下注
二元期权是一种金融衍生品，允许投资者在事件及资产价格变动上进行全有或全没有的押注，近年来其受欢迎程度急剧上升。但批评者，包括长期警告投资者的美国监管机构，表示这些交易更类似于赌博而非投资，并且对毫无防备的消费者存在高风险的诈骗和损失。
这些期权的结果基于“是或否”的命题，因此得名“二元”。如果二元期权到期时在“价内”，交易者将获得收益；如果到期时在“价外”，则会损失投资。2008年，美国证券交易委员会（SEC）批准二元期权在交易所上市交易。此后，芝加哥期权交易所和北美衍生品交易所（Nadex）为散户交易者提供标准化的二元期权。
尽管在受监管的交易所可以进行交易，美国的大部分二元期权交易仍通过不受监管的离岸平台进行，导致许多诈骗事件。[1] 二元期权在全球许多地方被禁止，包括澳大利亚、加拿大、欧洲、英国等地。[3]
二元期权有一个到期日和时间。当到期时，基础资产或事件的价格必须在交易所设定的执行价格的正当一侧，交易者才能获利。
二元期权自动执行，即当期权到期时，交易的盈亏会记入交易者的账户。这意味着，购买二元期权的投资者将获得收益或失去在交易中的全部投资没有中间状态。
例如，假设ABC的股价在2021年4月22日上午10:45会超过25，客户将错误地失去$100的投资。
因此，许多人发现二元期权比常规期权更易于理解，这也是其受欢迎的原因。由于存在风险，交易金额会受到限制，例如在Nadex期权交易所限制在约100或$0。
假设科尔盖特-帕尔莫里夫（CL）股票正在以25，交易者将根据约定的条款获得支付。例如，如果支付比例为70%，二元期权的经纪商会向交易者的账户支付65，则该期权在“价内”到期，价值25，客户将错误地失去40）。
如果期权到期时科尔盖特的价格低于2,500。[5]
普通美式期权赋予持有人在期权到期日或之前以指定价格买入或卖出基础资产的权利。欧式期权相同，但交易者仅能在到期日行使该权利。普通期权或称为期权，赋予买方对基础资产的潜在所有权。当购买这些期权时，交易者有预设的风险，但利润取决于基础资产价格的变动幅度。
二元期权的不同之处在于它们不提供对基础资产持仓的可能性。在这方面，它们纯属投机。二元期权通常设定固定的最大支付，而最大风险仅限于投资于期权的金额。基础“资产”可以是价格和事件。有些二元期权可以在到期前平仓，但这通常会减少获得的支付（如果期权在“价内”）。
二元期权偶尔会在SEC和其他机构监管的平台上交易，但大多数二元期权交易发生在美国以外，并不受美国官员监管。不受监管的二元期权经纪商无需满足特定标准或任何标准。因此，投资者应该非常警惕潜在的诈骗。相反，普通期权在受监管的美国交易所交易，且遵循美国期权市场的规定。[6]
购买二元期权时，请按照以下步骤操作：
在交易二元期权时，你应当注意潜在的诈骗风险。需要指出的是，许多二元期权平台在不受监管的金融市场外运营。这种缺乏监管可能导致较高的诈骗风险，因为缺乏监管。[11] 一旦发生诈骗，你通常会非常孤立无援。
你必须进行彻底的研究，验证经纪商的监管状态，以谨慎态度对待二元期权交易，充分理解风险及潜在的诈骗。
一个例子是，二元期权的入场价格表示潜在的盈利或亏损，所有选项的到期价值均为$100。
如果交易者希望进行更大的投资，可以调整交易的期权数量。例如，选择三份合约将风险提高至180。
这通常包括选择经纪商、提交申请、填写客户身份验证表格、资助账户以及验证你的身份以供经纪商使用。[4]
二元期权因其全有或全没有的支付、短期的投机性、波动性和涉及的杠杆而被视为高风险。
因此，在接触二元期权时应保持谨慎，充分理解相关风险，并制定具有风险管理措施的交易策略。使用受监管且信誉良好的经纪商以降低这些风险至关重要。
这在很大程度上取决于市场条件以及所涉及的事件或资产。最佳交易时间与产品的波动性、经济事件、数据发布和市场流动性有关。[4]
二元期权是一种金融衍生工具，基于“是或否”命题的结果，为交易者提供固定的收益或没有收益。交易者押注基础资产的价格在特定时间会高于或低于某一水平，直接导致两种明确结果：预先设定的收益或投资金额的全损。
当基础资产是金融工具时，交易者以独特的方式参与市场。然而，它们带来了显著的风险，主要由于其全有或全没有的特性以及存在大量不受监管的平台。因此，在通过交易二元期权将资金投入市场之前，最好是充分了解市场状况、制定合理的交易策略，并明确认识到相关风险。
[1] Financial Industry Regulatory Authority. "Binary Options: These All-Or-Nothing Options Are All-Too-Often Fraudulent."
[2] Commodity Futures Trading Commission. "The Truth Behind Binary Options Fraud."
[3] Finance Magnates. "CME’s Event Contracts: Are Binary Options Back?"
[4] Abe Cofnas. Trading Binary Options: Strategies and Tactics. John Wiley & Sons, 2016. Chapter 1.
[5] Nadex. "Position Limits."
[6] U.S. Securities and Exchange Commission. "Binary Options and Fraud," Pages 1-4.
[7] CFTC, "Beware of Binary Options Mobile Apps"
[8] Federal Bureau of Investigation. "Binary Options Fraud."
[9] Securities Administrators of Canada. "Binary Options Fraud."
[10] Commodity Futures Trading Commission. "Beware of Binary Options Mobile Apps."
[11] SEC, Office of Investor Education and Advocacy, "Investor Alert Binary Options and Fraud"
TheQuantHackers是由一群来自世界顶尖高校和量化金融从业人员组成的前沿社区，致力于探索人工智能（AI）与量化（Quant）领域的无限可能。我们的团队成员来自剑桥大学、牛津大学、哈佛大学、苏黎世联邦理工学院、北京大学、中科大等世界知名高校，外部顾问来自Microsoft、HSBC、Citadel、Man Group、Citi、Jump Trading、国内顶尖私募等一流企业。
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