Before moving on to the quotex advantages over other derivatives, it is important to first take a close look at how this trade works. As with all other options, the value of a binary option is based on an underlying asset such as stocks or currencies. These are linked to the performance of the underlying asset and any profit or loss from this trade will depend on whether the value of the underlying asset goes up or down. Read more now on quotex broker
But unlike other financial investment instruments, your profit or loss in this quotex type of trading is predetermined and tied to two specific amounts. For example, all-or-nothing binary options give you either the standard win or nothing at all. If the underlying is shares, even the slightest increase in the value of the shares on the expiry date would entitle an investor to the predetermined profit.
Conversely, a fall in the value of the underlying shares on the expiry date would result in a total loss or a predetermined loss depending on the terms of the option. There is no middle ground with this investment vehicle, only two possible outcomes, hence the term “binary” option. So why are they saying this commercial is less risky? than other traditional trading methods?The answer lies in two factors: a shorter expiration period and a predetermined profit/loss. From the outset, an investor knows exactly how much they could gain or lose on their investment, so there is less speculation and less risk.
There is no chance of losing more than you bargained for, as each potential loss is tied to a predetermined amount, allowing an investor to choose exactly the option they are most comfortable with. So you don’t have to worry about market shocks and upheavals that sometimes cause losses to skyrocket out of control. At the same time, an investor can achieve very high returns with this quotex trade within a short period of time.
Some binary options contracts offer returns of up to 85% of the investment, much higher than many other trading methods, including spot forex trading. The expiration periods are also much shorter, often lasting a week or less, quotex allowing profits to be made much quicker than traditional forex trading where one has to hold onto the currency purchased and wait for the currencies to be released, the better.