Casino City's iGaming Pocket Directory - 2014 Edition

46 Sponsored by FINANCIALS Casino City’s iGaming Pocket Directory BINARY OPTIONS The key to binary options is that traders are not buying gold or actual stock certificates or foreign currency. Instead, traders are taking a position on an asset. Will a foreign currency be higher or lower than a certain price when the market closes? Will an index close above or below a certain point? Will the price of oil rise or fall above or below a certain point? Binary options are similar to a futures contract where the trader predicts where the price will be in a certain timeframe, known as the “expiration.” These are transactions that require a certain amount of knowledge. How are the commodities markets doing? When is the next OPEC meeting? Is OPEC expected to increase or decrease production? Is demand for oil holding steady or rising? What’s refinery capacity looking like these days? They also require a feel for the marketplace. How does the market respond to certain types of news? Will the price go up if OPEC does what is expected? Or will the price only go up if OPEC goes in a different direction? And after factoring in all of the available variables, will the price close above a certain mark, or below a certain mark? Traders can even profit from predicting whether a price will break out of its range or touch a certain price in a certain timeframe. Because these are trades against a position, and no assets are bought and sold, the only limit to available markets is the imagination – or what your provider is willing to offer. SPREAD BETTING Much like options trading, spread betting requires a good feel for the market. A typical spread bet is predicting whether a market will move up or down. Let’s say a trader thinks a financial index is going to go down in value. A trader could sell for $5 per point. That is for each point the index drops, the trader would earn $5. If the index dropped 100 points, the trader would earn $500. But if the index went up 100 points, then the trader would lose $500. Once again, no assets are being purchased. Traders are simply taking a position against the market. FINANCIALS INDUSTRY OVERVIEW