What is a one touch option Where can I trade

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3 Types Of Binary Options

The main factor when talking about payouts is the type of binary option traded.

The option trade example given in the previous section is a type of an “up/down” option and is considered the simplest kind.

Predicting if a currency pair would be above or below the strike price before it expires pays the lowest return.

Meanwhile, the are more complicated kinds of options like the “touch and range” binary options, which have higher payouts since winning such trades tends to be harder.

Up/Down Options

An Up/Down option can go by a few different names: High/Low, Above/Below, and Over/Under. It is the simplest and most common type of binary option.

Traders simply purchase a “call” option if they believe that the closing price will be above the strike price when the contract expires, or buy a “put” option if they think that market will close below the strike price at expiration.

The EUR/USD trade example given in the previous section illustrates how an Up/Down option typically works.

Easy enough, eh? The simplicity of this option is why Up/Down options usually have the lowest payouts.

Up/Down options typically expire within an hour or a day, but some brokers are offering options that expire in minutes. Heck, some even expire in seconds!

Of course, this could either do your account a lot of good or it can cause a whole lot of damage. Make sure you manage your risk properly!

Touch Options

One Touch option trades don’t require the market to be above or below a certain level at expiration. Instead, it just needs to TOUCH the strike price at least once during the option contract period for it to be profitable.

No-Touch trades, on the other hand, require that the market price DOES NOT TOUCH the strike price during the life of the contract for a trader to make profits.

For example, let’s say that EUR/USD closed at 1.3100 on Friday.

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Over the weekend your broker offers a call option where you will profit if EUR/USD touches 1.3450 at least once next week and a put option where you will profit if the pair touches 1.2750 at least once in the same period.

You decide to take the call option. You find that during the option period EUR/USD had reached a high of 1.3600 before it closed at 1.3050.

Since the market reached the call option’s strike price (1.3450) within the option period, you would have won the trade even if it didn’t close above the level.

On the contrary, those who took a No-Touch option on the same price would have lost their trades since the pair DID touch the strike price.

Touch trades typically work out well when volatility picks up while no-touch trades are ideal for pairs that have a tendency to consolidate.

Still not exciting enough for ya?

You can also try out Double Touch/Double No-Touch options!

They are just like Touch/No-Touch options, only with two strike prices. The asset’s price has to touch (or not touch) two different levels for a trader to win the trade.

Range Options

Trading Range/Boundary/Tunnel options is a lot like playing the Super Mario underwater level wherein Mario cannot touch both the top and the bottom of the screen.

For In Range trades, the market price must stay within a predetermined range and avoid touching the two strike prices within the option period in order for your trade to be in-the-money.

Some brokers offer Out of Range options where traders can profit if price breaks out of the predetermined range within the option period.

For example, EUR/USD is currently trading at 1.3300 and the ECB interest rate decision is minutes away.

If price doesn’t reach 1.3280 or 1.3320 within the option period, then you would have won your trade.

That should be awesome news for you because range options usually have the highest payouts with a few brokers offering between 200%-750%!

Range options are best used when volatility is low, although some brokers offer the option to take a risk on the idea that price WILL break out of the predetermined range.

Alternatively, a few brokers also offer options on predetermined ranges that are far from the current market price.

Touch or No Touch Binary Options Trades and Strategies

One of the decisions you will of course have to make when you are a Binary Options trader will be just what type of trades you place. There are several different trades available and many of the most successful traders will use a series of different trades in the hope they can make continuous profits over the long term.

You will find that some trades may call for you to place a long term investment on them in the hope that over time the share prices of the companies you have selected or the price of the commodity will fall or rise as you predicted.

However, with news stories and financial data that is released by companies and countries always having an instant effect of many trading opportunities some much shorter term trades may be called for.

There is a type of trading opportunity known as a One Touch trade and unlike a long term trade where you will only find out when you have made a profit one those trades expiries a One Touch trade works in a completely different way.

By placing a One Touch trade that trade is going to end when the value of whatever it is you are basing the trade on touches one of the two different values as found on the trading platform. So if you think a trading opportunity will increase in value, then as soon as it touches on of the indicated value that trade will end and close.

Frequently Asked Questions

  1. How Can I Test Our One Touch Trades?

One of the easiest ways that you can experience placing One Touch Binary Options trades, and do so in a no risk trading environment will be for you to open up a demo trading account at one of our featured Brokers.

In fact by doing so you will not only be restricted to placing demo One Touch trades but you can place any type of trade available, which will of course allow you to see which ones appeal to you the most.
Which Brokers Offer One Touch Trades?

You will find that all of our featured Binary Options Brokers are going to allow you to place any type of trade you can think off! So if you do fancy placing several of these types of trades either in a free demo trade environment or for real money then feel free to sign up to any of our top rated Brokers as all of them are going to allow you to place One Touch trades via their respective trading platforms.
What is he Expiry Time for One Touch Trades

There is no set in stone expiry time for a One Touch trade, and with that in mind you should consider whether they are the type of trades you are interested in placing.

It will be at the moment in time that your chosen trading opportunity reach either the low or high value as indicated when you place the trade that is going to determine when the trade expires.
Are One Touch Trades Available on a Mobile Platform?

We are always being asked if there are going to be any compromises Binary Options traders are going to have to make when they opt to use a mobile device as the way that they place their trades.

Well, one of the main reasons we have chosen to showcase to you all of the Brokers listed throughout our website is that they offer both online and mobile trading platforms, on which you will be able to place exactly the same number and type of trades. So you will be able to place One Touch trades on any type of mobile device when accessing any of our approved Binary Options Brokers mobile trading platforms.
Can I Place Multiple One Touch Trades?

As long as the Broker who you have signed up to and whose trading platform you are logged into has One Touch trades listed then you are going to be able to place as many or as few of those types of trades as you like.

So if you are the type of trader who has a trading strategy calls for you to have several active and open trades in place then these are certainly trades worth considering utilizing.

Brand New to Options? Learn the Basics Here

Option Trading is continuing to see a rise in popularity with traders– and it’s easy to see why.

You can take small amounts of capital and leverage it up for fast gains. You can also learn how to hedge your portfolio against drops in the market. Or maybe you could take the other side and become the “insurance salesman,” collecting premium every month.

But with all of the opportunities, there is a fundamental lack of understanding as to how the options market works.

This guide about Option Trading Basics will get you the information you need to become a great options trader.

What is an Option, Anyways?

Options are a contract. That’s it.

It’s a contract between two parties to exchange something.

What are they exhanging? Risk.

Capital markets are risky by nature. Stocks go up, stocks go down– sometimes they crash. Due to this risk, some investors want to remove some of that risk, and are willing to pay a risk premium for it.

The Risk Exchange in Options Trading

It’s like car insurance. Driving is risky, and to protect yourself, you pay a risk premium to the insurance company so if anything really bad happens, you don’t lose a ton of money.

Options are also a derivative. That means their price is derived from something. That “something” is simply the relationship with the underlying stock, and the risk premium people are willing to pay.

How the Price of an Option is Derived

Options are contracts that have an expiration date. If the buyer of the option does not use (exercise) that option before the date, then it will be rendered null and void.

Where Options Trade– the Options Market

Since options are a contract, there will always be two sides to each trade. There will be an option buyer, and an option seller.

The buyer is looking to pay a premium to transfer risk. The seller is willing to accept that risk for a certain premium.

Because there are so many stocks and so many kinds of options, it makes sense to standardize the contracts.

For most options, the standard size of the contract is 100 shares.

Because the market is so big, it wouldn’t make sense to have thousands of different people trying to call each other to match their needs. To solve this, we have a centralized options clearing organization to help match buyers and sellers. This organization is known as the Options Clearing Corporation (OCC).

All Standard Options are Cleared Through the OCC

There are differnet markets like the CBOE, Nasdaq, and the NYSE, but they are all participant exchanges within the OCC.

Why You Should Trade Options

When you trade stock, you can only bet on one thing:

Long or short. Up or down.

The only decision you make when trading stock

With options you have two extra components: risk, and time.

Because of these extra parts, you can make bets on the direction of the stock, how fast the stock will move, and how long will it take to get there.

Understanding how prices move over time will get you an edge in the options market.

In other words, many more options open up for you in your trading.

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Learn how to make money trading options, no matter where the market goes.

The Difference Between Stock and Options

A stock represents a share of a company. And because it’s a fraction of a company, there is a fixed amount of stock– this is known as the float.

With options, there is no fixed amount– it is theoretically unlimited. The only time an option is created is when two parties come to an agreement on the risk pricing and they transact with one another. When this happens, open interest is created.

The open interest in an option refers to all contracts that are open and haven’t been settled.

The Major Parts of a Stock Option

There are 4 main parts to a stock option.

Underlying: this is the stock or etf that the option is based upon. Because options are transactional in nature, there must be something to transact!

Strike: this is the value at which the transaction will take place.

Month: this is when the option will expire.– that means the terms of the contract will expire on that expiration date. For standardized options the expiration date is on the third Saturday of that month.

Call or Put: This defines what “kind” of option it is, whether it’s to buy or sell the underlying.

The Difference Between a Call Option and Put Option

There are two distinct kinds of options– a call and a put.

A call option gives the buyer the right to purchase shares at a certain price, and it gives the seller the obligation to buy at a certain price.

A put option gives the seller the right to sell shares at a certain price, and it gives the seller the obligation to sell at a certain price.

The key difference lies in what the contract transaction looks like– whether they want to buy or sell stock.

How You Can Trade Options

Due to high demand from retail investors, most all brokerages allow option trading in cash and margin accounts.

There are a few brokerages out there that still limit your ability to trade different kinds of option strategies. This is a bad idea because it removes your ability to manage risk through options adjustments. Either get full access to all strategies, or find a new broker.

What Happens if You Get Assigned

If you have a short option position on, there is a chance that you can get assigned. Keep in mind, that chance is very low.

If you are assigned, the transaction in the option will be carried out.

If you are short a put option, you will have shares put to you, and money will be debited out of your account. If you are already short the stock, then the short will be removed from your account.

If you are short a call position, you will have to come up with the shares to sell to the call buyer. If you already have the shares in your account then they will be removed and money will be credited to your account. If you don’t have the shares you will be assigned a short stock position, and short margin will come into play.

How You Can Make Money Trading Options

There are two main ways traders make money with options.

The first way is directional trading. This is where traders will use the leverage and risk structure of options to make a bet on the movement in a stock price. There are advantages to options over stock because you can dictate exactly how much you are willing to risk on a bet.

The second way is volatility trading. This is where traders use the other two components– risk and time– to make bets on the market. If a trader is expecting less movement than what the market is pricing in, it’s often called income trading.

These two kinds of money-makers are not exclusive. You can find ways to make bets on both direction and volatility, which gives you a distinct edge over other traders.

Can I daytrade with options?

Absolutely, but there are risks. Because you are using options on a short term basis, there are extra issues to deal with.

The first risk is liquidity risk. If you are going to daytrade options, you must make sure that the options you are trading are very liquid so you can enter and exit very easily.

The other risk is volatility risk. If you are trading in size, you become much more sensitive to movement in the implied volatility of the option. That means the profits you expected to make may vary much more than you think.

Also keep in mind that these are leveraged instruments, so if you are not successful at daytrading, the leverage can hurt your account.

Trading Options With Stock

Stock and option combinations are great opportuniteis for investors as they offer ways to get better prices on stocks they really want to own.

There are 4 main combinations of long stock positions.

The different risks of stock and option trading

The first is the cash-secured put. This is a trade where the investor is short a put with the intention of getting assigned. This is a great way to enter into a stock on a reduced basis.

The second is the buy-write, or covered call. This is a combination of long stock with a short call that is “covering” the stock. The premium received in the stock helps to reduce the cost basis of the position, and removes some of the overall risk in the position.

The third is a protected put. This is a combiation of long stock with a bought put. The investor pays a premium to remove downside risk underneath the strike price of the option. This is a good position if the investor wants to eliminate downside risk on a position but still wants upside exposure.

The fourth is a collar. This is long stock paired with a covered call and a protected put. This trade has limited risk from the protected put and limited reward from the covered call. This allows the investor to keep the stock position on but with much less volatility.

Want More? Get our Free Video Training Here.

Learn how to make money trading options, no matter where the market goes.

Touch/No Touch Option

Intrducing the One Touch Option

The One Touch option is a type of binary options contract that is available on some selected platforms in the binary options market. Usually traders will only get to see this trade type on the trading platforms of brokers who are white-label partners of Tech Financial Ltd or SpotOption Ltd.

The One Touch option is a high yield option in which the broker sets payouts to as high as 250% to 500%. In return, the trader is expected to predict if the asset in question will touch a particular strike price located at some distance away from market price, in the one week that the trade will be active.

The trade expiry is one week, starting at anytime from Friday/Saturday the previous week and terminating at the close of the trading day on Friday a week later. Therefore, the trader can only enter a position from Friday evening till Sunday morning. The exact open time for the trade depends on the broker used for the trade execution. The hallmark of this trade is that the strike price is located far away from market price, and the ambitious nature of this strike price is what drives the high payouts promised for this trade.

So what chances does a trader have in succeeding with this type of trade? Success with the One Touch will require that the trader select the right kind of asset and the right opportunity at the right time.

Selecting the Right Asset

Assets which are naturally trending, and whose price movements have high volatility are the assets of choice for this trade type. Assets that are more inherently range-bound assets or assets that have a tendency to trade in a very tight range do not perform well with this trade type. Certain commodities such as gold, as well as certain stocks and currencies will tend to do better with this trade type than other.

Selecting the Right Opportunity

An asset that is on the verge of a major breakout is an asset that is presenting the right opportunity. Breakouts are created by major news events. In the stock market, a trader will typically be looking at the corporate earnings season, singling out assets for which the market has major expectations.

For the forex market, the trader will be looking for high impact news events that are likely to lead to big moves of up to 300 pips or more. Recently, we have seen gold and the Australian Dollar sell off massively in the markets. The moves seen are indicative of what a trader looking to profit big time from the One Touch trade should be watching out for. These are the times when an asset is said to present a wonderful opportunity to profit.

Trades are typically set during the weekend. The weekend will therefore be a good time to set up trades on assets that present the right opportunity on the Monday or Tuesday following the trade setup. Therefore, the trader will have to look at the time tables or calendars for events such as release of news or release of corporate earnings.Assets that are considered the right candidates and whose news will be released on a Monday or Tuesday following the weekend the trade is setup are then selected. If an asset whose news will be released on a Thursday is used, either the trade will be too late to catch its move (if setup on the Saturday following the Thursday), or the trade will not have enough time to experience the kind of move it needs to end up in the money (if setup on the Saturday preceding the Thursday in question). So timing is key. We need the news to work in our favour and to have enough time to do this quite early.

Trade Requirements for the One Touch Trade

The trader must select from the assets that the broker has presented for the One Touch trade. Usually two trades for one asset are presented, with the strike price located above market price for one trade, and located below the strike price for the other trade. The trader therefore has to pick the right direction for the trade in order to succeed. Certain clues as to what direction a trade may possibly take are to look for continuation patterns on the charts, and to study historical news reports to see whether a trend has developed which could be used as a predictor of what the price movement is likely to be.

Once the trader has these pieces of information, the trade can then be taken when it opens and then the big payday can be expected.

More About Adam

Adam is an experienced financial trader who writes about Forex trading, binary options, technical analysis and more.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    The Best Binary Options Broker 2020!
    Perfect For Beginners and Middle-Leveled Traders!
    Free Demo Account!
    Free Trading Education!
    Get Your Sign-Up Bonus Now!

  • Binomo
    Binomo

    Good Broker For Experienced Traders!

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