Read this article at Forbes : Don't Gamble On Binary Options
They do a good job explaining that binary options are really just a form of gambling.
Also be aware that they are often unregulated and read the warning from the SEC : Binary options and Fraud
So what are they? In short :
You can make a bet that a stock will go up or down for a very short time period. For example you buy a $100 option that it will go up. 5 minutes later if you are right you get $170. If you are wrong you get $15. Do that 1000 times spending $100 x 1000 or $100,000 and get it right 50% and you make $92,500 and you lose $7500. The allure here I think is that people think they can make informed guesses about what a stock or commodity will do. But you can't.
Avoid binary options. Its just gambling and the odds are stacked against you. Plus its unregulated and prone to fraud.
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