Binary Vs Digital Options: Which Gives More Profits In 2021

Binary VS Digital Options: which type is more profitable?
What do Binary and Digital Options Have in Common?
At IQ Option , one can trade two types of options: binary and digital . Both are a specific asset type called derivative — i.e., their value is intrinsically tied to the value of an underlying asset.
Buying or selling an option doesn’t mean you actually acquire the underlying asset. Instead, you speculate on whether the asset‘s price will go up or down over a certain period. Once the option expires, the deal gets closed automatically, and you either earn a profit denominated in percentage or lose your investment.
Let’s find out how these two types of options differ and which principles determine the outcome of the deals.
Binary vs Digital options : the Differences.
Binary and digital options differ in three categories: events that determine the outcome of the trade, returns, and expiration periods.
The outcome of the binary options trades depends on the direction of the price . That is, all you need to do is assume whether the price of the asset will go up or down, and if your forecast was correct, your deal is considered profitable. For digital options , it’s not only the direction of the price that matters but also the price distance from the opening price . The potential return for binary options at IQ Option can go as high as 95% . Your return on each trade is fixed and predetermined when you open a trade.
For example, you open a BUY option with an 87% expected profit — if the trade closes even slightly above the strike price, you get 87% of the invested amount.
Binary VS Digital Options.
A "Lower" binary options deal example. With $100 invested and an 87% expected profit, mouse click the up coming website price closed lower than the opening price (red line), which resulted in an $87 profit.
In the case of digital options, your potential return will fluctuate over the entire course of the deal : the further the price moves relative to the opening price, the higher the percentage of your profit or loss will be.
Binary VS Digital Options.
A "Lower" digital options deal example. The $100 investment yielded a 172% profit when the price closed lower than the selected strike price (red line).
With binary options trading, you can’t lose more than your investment amount. With digital options trading, however, your losses can exceed your initial investment — just like your profit could. The further away the price moves from your strike price, the higher your loss percentage.