How to trade digital options
The trading process may be described in a following way. On the right thechart has a few levels of value. These levels are called strike- prices (target levels). It means that the opening price should run beyond or below for the position to approach to the money.
When one chooses various strike prices, it is possible to see the change of profit ability with the help of he ”Higher” and “Lower” buttons. It stands upon the ability of the asset price to reach the set strike level direction that has been chosen. The lower the probability the price being reaching the strike level, the more the profit will be.
Next it is necessary to choose a strike price, the amount of investments. It can be done with the help of the “Amount button” on the right panel.
Next the expiration time and the moment when the tool ceases to exist are necessary to be chosen. It can be done thanks to the “Time” button. The solid red line on the chart means the expiration time. The chart's dotted line tells about the purchase deadline. Up to this time, trader has an opportunity to buy unlimited amount of the same asset's options at different strike-prices and both in a higher and lower directions.
Next it is necessary to make choice of the price movement direction. If trader thinks that the closing price will be lower than the chosen strike line, he needs to click “Lower”. If he predicts the closing price to be higher than the strike price, he needs to press “Higher”.
After the transaction's crossing the red line and expiring, trader will be able to see the result: either the green window meaning his end profit, or the red window meaning his loss.
But what are digital options? It is a new trading instrument worked out by IQ Option (a binary options trading company having a modern and innovative trading platform, profitable trading opportunities, bonuses and a good clients support system). This instrument combines peculiarities of both classical and binary options. It also gives an opportunity to trade with the help of various assets.
The instrument's main peculiarity lies in every transaction's profit and risk being depended on chosen strike-price.
The instrument has bigger flexibility and higher profit potential than binary options the profit of which is predetermined. Trader can increase or decrease level of potential profit and risk by changing of strike-price. The closer is strike-price to current price level, the less is potential profit from transaction, but, at the same time, the less is risk. Alternatively, the farther strike-price from current level of value, the more potential profit from transaction and risk connected with it.
It is also may be sold before it becomes invalid. If trader feels that trend starts moving towards wrong direction, he may anytime to sell his option. Transaction may be opened in a few clicks.