Binary options (also called 'digital options' or 'all
or nothing options') are a special type of options. (Are you not
familiar with options? Please read the article 'what are options'.) As
with ordinary options, binary options have an underlying asset, which
can be a stock, but also, for example, gold, oil, the S&P500 index,
or the US Dollar. How much you earn or lose with a binary option depends
on the development of the value of the underlying asset.
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