Destin Gaja Priya
18-08-16 0 Hits

Forex options are a derivative instrument that gives the option holder the right but not the obligation to sell a specified amount of currency (notional) at a pre-agreed price (strike) at a given date (option maturity). If the option holder has the right but not the obligation to buy the currency cross (remember in forex the purchase of a currency always implies the sale of another one), the contract is called a call option. The contract holder has the right to "call" the asset.

Digital options, also known as binary options, are options whose returns can only be two (2) possible outcomes, 'In The Money' or 'Out Of The Money'. In addition, the payout of digital binary options are fixed beforehand regardless of whether the underlying asset price is one (1) pip or one hundred (100) pips above (for call options) or below (for put options) the strike price. In other words, whether the fact that you are in the money by $1 or $5, the payout that you will receive is the same.

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