Optionbit Has Unique Binary Option Tunnel Trading Advantages
Virginia Reynolds, a partner of M and V Reynolds & Associates has studied the binary option trading platform of Optionbit and has summarized its advantages as follows:
(1) Returns up to 91% can be achieved.
(2) Market prices are obtained direct from Reuters.
(3) Trading is available in 12 languages:
(4) Optionbit is based in Cyprus with support offices in: Mexico, South Africa and the United Kingdom, operating 24/7.
(5) Up to $500 as a Welcome Bonus is credited to the trader’s account - on deposits $2,000 and above. Deposits $500 - $990 attract a 20% bonus, $1,000 - $2,000 attract 30%, and, as mentioned, deposits $2,000 and above attract 40% ($500 maximum).
(6) The new trader can open a demo account with $500 “play” money so that he can get comfortable with the three types of trades.
(7) The three types of trade provided are Range, Digital and Touch.
Now the Range type of trade is specially interesting. It is based on what’s termed “tunnel trading”.
Virginia Reynolds continues: “Tunnel trading means that pre-determined boundaries of the underlying asset price movements, both up and down, over a given period of time, are set up, and if the asset price then breaches these boundaries or tunnel, either up or down, then the trader is in the money if he purchases an out-of-range option. If the trader purchases an in-the-range option and the price remains within the range then the trader will be in the money here as well. The converse applies of course. Another expression for these pre-set boundaries is ”tripwires“. The key point here is that binary trades are set up without having to forecast beforehand if the asset price goes up or down. The binary option yes/no determinant of being in the money or not is whether it is taken within the tunnel range or out of the tunnel range.”
For example, if the trader decided to buy an in-the-range option, yielding 81%, of USD/EUR currently trading at 1.10 with the option range (or tunnel) is between the boundaries (or tripwires) of 1.00 to 1.30 and the option expiration price is 1.12 then the trader receives 81% return. That means that 181% of his option price is banked. Now if the trader buys an out-of-range option on the same currency pair trading at the same price with the same tunnel and the expiration price is 0.99 then the trader is again in the money. The converse applies for out of the money trades. Thus is the same examples, the trader loses if the expiration price is 1.31 for the in-the-range example and loses if the expiration price is 1.01 for the out-of-range example.
Notice that the trader does not have to worry about whether the expiration goes up or down - just as to whether the expiration price stays in, or breaches, the range (or tunnel).
A digital option is based on cash or nothing trading and is the most popular type of binary option. The way this works is already adequately covered by a number of posts on the home page of M and V Reynolds & Associates’ website: http://ableforex.com. Optionbit also provides close now (early close before expiration date) and extend (rollover or extend past the initial expiration date) variants to this type of trade.
Optionbit also offers touch trading whereby the trader predicts that the asset will reach a set strike price at any time before the time of expiration. If this occurs then the trader will be in the money at the predetermined percentage payout level. Of course, the converse applies.
To open up a demo account and play around with what the site has to offer, using its $500 play (notional, not real) money, visit http://www.atoptionbit.com. Then commence with trades ranging from $100 (minimum) to $1000 per trade. Also, take advantage of the bonuses offered.
- Contact Information
- Michael Reynolds
- M and V Reynolds & Associates
- Contact via E-mail
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