Glossary

Our binary trading glossary found below is the easiest way to learn about binary option terminology and increase your knowledge about the markets.  We created this trading glossary to address common questions about terminology used throughout our site.  The following binary options glossary lists the most common binary option terms in use on the 24option.com site and in the general binary option industry.

If you have any questions or concerns not addressed in our binary glossary, please visit our binary options guide for additional information.

At the money: Used when the market price of the asset is currently trading at or has closed at the exact target price.

Binary Option: A term that refers to a specific type of financial instrument that offers a fixed rate of return that is predetermined before the investment is made. Click to learn more.

Boundary Instrument: A type of binary option in which the trader decides whether the market price at the time of expiry will be within a price range or outside of that set range.

Early Closure: This is a feature on the 24option.com platform that allows a trader to close a position before the expiry time.

Expiry Level: This is the level of the asset at the time of the asset’s expiry which is based on data received from 24option.com’s data provider.

Expiry Time: The time and date at which an option expires.

High Option: A binary option type in which the trader believes the market price of an asset will expire above the current market price.

High/Low Instrument: A binary option in which a trader can decide if the asset’s market price will expire higher or lower than the current market price.

Inbound Option: One possibility of the boundary option. The trader decides if the market price will expire inside the predetermined price range.

Investment Amount: The amount of capital invested in an individual binary option.

In the Money: This term means that the market price of the asset is currently trading at the target price or has closed and is profitable.

Low Option: A binary option in which the trader believes the market price of an asset will expire below the current market price.

Market Price: The current price of the asset based on the data provided by 24Option.com’s data provider.

No Touch Option: A binary option trade in which the trader decides if the market price will not reach a predetermined price through the life of the option.

One Touch Instrument: A binary option trade in which the trader decides if the market price will reach a predetermined price through the life of the option.

Out of the Money: This term means that the market price of the asset is not currently trading at the target or has closed and is not profitable.

Outbound Option: One possibility of the boundary option, the trader decides if the market price will expire outside the predetermined price range.

Refund: This is the amount of money refunded to the trader if he/she has invested in an option that accounts for a refund if the option expires “Out of the Money”.

Return: The return is the percentage of the original investment that the trader will receive if the investment is profitable.

Target Price: Target price, also known as the market price, is the current price of the asset based on the feed by the data provider.

Touch Option: A Touch Option is a binary option that will expire in the money if the market price at any time during the life of the option reaches a predetermined level.

Underlying Asset: The asset in which the trader is invested in the binary option.

Underlying Asset Types: 
Stocks (e.g. Google, British Airways)

Commodities (e.g. Gold, Brent Crude)

Indices (e.g. NASDAQ, FTSE 100)

Currencies (e.g. EUR/USD)

We hope that you found this trading terms glossary helpful and educational.  To learn more about binary option trading visit our binary trading guide or click here to enter our live chat.

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General Risk Warning:Trading in Binary Options carries a high level of risk and can result in the loss of all of your investment. As such, Binary Options may not be appropriate for all investors. You should not invest money that you cannot afford to lose. Before deciding to trade, you should become aware of all the risks associated with Binary Options trading, and seek advice from an independent and suitably licensed financial advisor. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to Binary Options or (b) any direct, indirect, special, consequential or incidental damages whatsoever. For more information about the risks associated with trading Binary Options click here .
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