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Binary Betting is an exciting new way to bet on financial events. How does a binary bet work? Binary Bets are different in the sense they have just two possible outcomes, either settling at 0 or 100.
Just like spread betting, the profits are tax-free*. (*Tax law can be changed or may differ depending on your personal circumstances.) Lets take a look at the FTSE. What is the FTSE? The FTSE is pronounced Footsie, and it a share index of the 100 most highly capitalised UK companies on the London Stock Exchange.
When betting on the FTSE, for a binary bet up, you will be offered a market price for example the FTSE 100 or Gold and whether it will close up on the day. Binary bets are quoted in-between 1 and 99. Lets say it is quoted at 63-65. If at the end of the day the index closes higher than quoted, then the binary settles at 100.
At the close of business if the FTSE closer lower then it settles at 0. Binary bets can not rise above 100, nor fall below 0. Binary Trading is not subject to regulation by the Financial Services Authority.
There are different global indices in which to spread bet, including Australia 200, US Tech 100 and Wall Street and many more. A stock market can be classed in different ways, it can be called a world or global stock market. The most commonly quoted market indices are national indices. For example there is the German DAX, the Japanese Nikkei 225, the American DJIA. Spread betting indices is one of the most popular forms of spread betting with a huge range of indices across the globe to choose between.
Commodities are a volatile market, and this makes them a popular market in which to spread bet. If something is volatile it means that things can affect its production, for example floods, fire, disease. Why does this make them a popular market to spread bet? Generally, if something is volatile it means there are big returns to be made, but taking the good with the bad, this also means significant losses can be made.
Commodities are things of value that are produced in large quantities by many different producers. Commodities can include coffee, cocoa, natural gas, gold, silver, and many more.
Commodities can have a busy and quiet season, so it is a wise idea to study up on the various commodities and factors affecting their production before spread betting with real money. If you understand the different commodities then this will give you an edge on many spread betters who jump in with no clue about the commodity.
And the golden rule always applies. Smart spread betters know that you should only ever bet with money you can afford to lose and you should always know the risks involved as spread betting is a leveraged product and can result in losses that exceed your initial deposit.