What is your opinion on binary options?

Discussion in 'Options' started by Lloyd W. Coutee, Oct 14, 2015.

  1. It's like playing roulette with three-four zeros. It's possible to win for a certain period by using forex knowledge, but it's the timing that gets you in the end with the expirations of the options.

    Steer clear.
     
    #11     Oct 14, 2015
  2. gkishot

    gkishot

    Yes, you are not allowed to sell short.
     
    #12     Oct 14, 2015
  3. Sig

    Sig

    Not to be a smartass but its binary and you're probably thinking vanilla where there is a difference. There is no difference in binary between selling a call and buying a put.
    Nadex has a bid/ask spread and you can offer inside that spread to be the new bid/ask, or you can sell a position you already have into the existing spread. Nearly all the volume is to/from the market makers and there appears to be only two in any given product, so the bid/ask spread is very big, but it is a functioning market. There is also another CFTC regulated exchange in the U.S., cantorexchange, which works the same way. Unfortunately they are just getting started and have even wider spreads, but I can envision a future with 3+ market makers on each platform and the two competing enough to create a competitive market with reasonable spreads.
     
    #13     Oct 14, 2015
  4. Just tried it out. Man those are wide markets. Great to be a market maker.
     
    #14     Oct 14, 2015
  5. zbestoch

    zbestoch

    I can as well. And the current spreads on some of the products are not "unbeatable." If one trades his market and there is a product that corresponds to his timeframe, then there is no reason one should not be able to trade binaries and achieve a similarly profitable result.
     
    #15     Oct 14, 2015
    Lloyd W. Coutee likes this.
  6. Second, no one, no matter how knowledgeable, can consistently predict what a stock or commodity will do within a short time frame. Will AAPL)shares go up or down in the next 10 minutes? Unless there has just been some major announcement from the company, there is no way to even guess at that.
     
    #16     Oct 15, 2015
  7. cornix

    cornix

    Ironically one of my most profitable trading experiences was binary options. But it was:

    a) in 2005-2006.

    b) Due to those options being mispriced by the broker.

    As soon as situation changed, opportunity was gone, too.
     
    #17     Oct 15, 2015
    Lloyd W. Coutee likes this.