Alpari Russia is introducing a new type of offering for clients of its binary options service – the name of the new tool provided to traders is Spread High/Low. In a nutshell, there is a spread added to the market price for those more volatile times when a trader is more confident that a bigger move is going to occur in a given asset.
While the offering is marketed as an increased opportunity for higher profits, coming with a 100% payout, there is no free lunch, meaning that the risks associated with trading these particular options are higher because of the handicap on the market price.
Alpari Russia is serving as an agent to a company named Binary Products LTD, which is registered under the laws of Saint Vincent and Grenadines.
Alpari Russia’s Binary offering provides a number of solutions for users. traders can trade using the High/Low, One Touch, and four other order types that allow users to dictate their own terms. The firm offers a web-based trading platform, coupled with its mobile offering on the iOS and android system.
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Binary Options trading continues to evolve as participants on both sides of the spectrum establish themselves in the short-term trading approach. The ‘gamification’ of financial markets has resulted in traders exploring trading instruments such as Binary Options that meet the needs of their short-term trading objectives and can be used in fast moving markets.
We will have a more detailed look at an example of the new binary options play offered by the company.
In this particular case, we have chosen to buy a Spread High option on the GBP/USD forex pair. The market price of the GBP/USD pair is 1.6094, however, in order to play the Spread High/Low option a markup (or markdown in the case of a Spread Low option) is being added. In the given example the markup is 6 pips – so the trader would bet on the price of the GBP/USD to close above the final price which is the market price plus the markup.
For those of you familiar with sports betting, this is essentially a handicap bet. Just as a football team can have a goal or two (or more) added to its score to add to the final result of the game, the Spread High/Low binary option’s end result will depend on the market price closing above/below the bet’s price which is formed from the market price plus the spread.