Binary Pair Options
Binary pair options are a new development and not many brokers offer them, but they are an exciting combination of traditional forex principles with the variety of binary options. They are still binary: you have a choice between two options, and you can either win or lose. The difference is that instead of picking a static value that an asset must either rise above or fall below, a pair option works based on how one asset performs against another. For example, you can place a trade that says that stock in General Motors will do better than the stock of Ford at the time of the option’s expiry.
Clearly, this can be an easy choice at times: sometimes a stock can slump for long periods of time, and sometimes a stock can be on a long upwards tear. For this reason, brokers that deal in pair options place different odds on opposed stocks: if Ford has been on a long, steady decline, the payout for a pair option that General Motors will outperform Ford will be lower than the reverse pair option.
Also see the list of the Best Binary Options Signals providers
There are different ways to measure an asset’s performance, so there are also different ways to place a pair option trade. A fixed trade starts at the time you place the trade, and measures relative performance. This means that the two assets’ values are equalized at the beginning of the trade, and you are making a prediction that one asset will rise more or fall less than the other, not based on their actual final values.
A floating trade starts at the beginning of the current period, whether that period is a day, a week, a month, or any other time period. These trades are also based on relative performance, but the assets in question are equalized some time before the trade is made and are at different positions in real-time. A floating trade can be closed before the end of a period, but the payouts are generally lower if this is done.
Brokers can change the odds based on market trends, and they aren’t going to make it easy, but with a decent understanding of market trends and some spare cash it is absolutely possible to make profits by trading binary pair options. Choose your flavor, choose what assets you want to trade on, and get started.