Out of the Money

28 Feb 2013, 10:00

Binary Options at a Glance Thursday

In this edition we’ll explain the term Out of the Money, which is widely used in binary options.

There are two outcomes when you place a binary options trade; that the option will be “In the Money” or “Out of the Money” (there is a rear occasion that it ends up “At the Money”).

out of the moneyRelated Articles:

In the Money

Terms Used in Binary Options Trading

 Risk Implications on the Binary Options Market

Out of the Money

Out of the Money is when a trader makes a binary options trade which finishes at a loss.

by ActionBinary.com

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For example if you place a “Call” option, it will be Out of the Money if the price at the time it expires is lower than the price when it was purchased. If you place a “Put” option, and the price at expiry is higher than the price it was purchased, it will be Out of the Money.

Usually brokers offer 0-10% loss back of your investment, if the option finished Out of the Money.