Binary Options are financial instruments that have two outcomes, hence the name. You predict the price of the asset will be above or below a certain price point after a certain period of time.
You don’t have to pinpoint the exact price, just speculate if it is going to be above or below a certain price level.
If you are accurate in your prediction, you will win a payout. The payout is fixed and is known to the trader beforehand.
Binary Options Brokers offer attractive payouts ranging from 60% to 90%. This means if you invested $100 in trade and predict accurately, you get $180 if your payout is 80%.
Keep in mind that if you get your prediction wrong, you get nothing in return and lose your initial investment.
I get why Binary Options are compared to gambling but I personally believe these two are different things. Gambling involves testing your luck while trading binary options is a different ball game.
Traders analyze the market, carefully choose the asset, and perform fundamental and technical analysis, and then place the trade.
While binary options are getting banned in some countries, other countries are accepting it with open arms. The future of binary options doesn’t has a certain direction but it certainly is gaining more and more traction.