This situation rarely occurs because almost all assets change in value, even if only slightly. Anyone who has watched the NASDAQ or other major markets has seen the constant fluctuation inherent in financial markets and commodities. Smaller assets tend to change even more regularly, so it is statistically rare for an asset to have the same value at the opening of the contract and the expiration.
However, in the event that this does happen, the policy for payment varies by exchange and by broker. In most cases, the trader receives their money back without a payout or a loss. It’s important to check on these and other policies when choosing a broker or an exchange.
People who begin binary options trading will hear a lot about binary options signals. What exactly are signals? Basically, they are signs that certain options are going to perform in a predictable way and thus be a good choice in binary options trading. As binary options traders become more serious, they often purchase a subscription to a signal service which keeps them up to date on these signals. Signal services are available that send emails, texts, or simply update a webpage. Some are free and some charge a subscription price.
When a trader has correctly predicted the direction of change in value, this is often called “settling in the money.” If they incorrectly predicted, it is called “settling out of the money.”
Obviously a trader wants to settle in the money as often as possible.
One key difference between binary options trading and other forms of trading is that the trader never actually owns any asset. Thus, there are no concerns about whether the asset is liquid nor concerns that it will become a liability. On the other hand, there is no actual asset to offset potential losses.
