Falcon-Finance GLOSSARY

GLOSSARY


Binary option. Binary options are financial instruments, sometimes also called digital options or fix return options, which allow traders to make profit when the value of an asset reaches above or below the strike price at the moment of expiry. When trading binary a trader has to predict a direction of price movement of an asset in a specific time frame. Binary options are considered to be one of the safest financial products due to the fact that traders know their potential returns and risks in advance.

 

Call-option. A trader is choosing Call options if he believes that the value of the asset he is trading will increase in price and will be higher than the strike-price at the chosen expiry time.

 

Put-option. A trader is choosing Put options if he believes that the value of the asset he is trading will decrease in price and will be lower than the strike-price at the chosen expiry time.

 

Underlying asset. The underlying asset is a financial instrument that holds economic value.

 

In-the-money. The term is used to define a winning trade, meaning that trader’s prediction was correct and he has made profit.

 

Out-of-the-money. The term is used to define a losing trade, meaning that trader’s prediction was wrong and he has lost is investment.

 

At-the-money. This means that the purchase price of the trade (strike price) ends up being the same as the price at the expiry. Trader is getting back the invested amount without making any profit.

 

Expiry time. The expiry time is the exact date and time when a binary option expires and a position automatically gets closed.

 

Expiry price. Expiry price is the asset’s price at the moment of expiry. Expiry price is being compared to the strike price and thus it is determined whether the trade’s prediction was correct or not.

 

Strike price. This is the price of the underlying asset at which a trader is entering a trade.

 

Deposit. Deposit is an amount of money a trader is depositing on his trading account with the broker (on a trading platform) in order to start trading. Minimum deposit with Falcon Finance is 10 USD.

 

Investment. Investment is an amount a trader is putting in each particular trade. Minimum investment amount with Falcon Finance is 5 USD.

 

Fundamental analysis. Fundamental analysis is method of evaluating an asset and predicting its price movement by examining related economic, financial, political and other qualitative and quantitative factors.

 

Technical analysis. Technical analysis is a method of evaluating an asset and predicting its price movement by analyzing statistics generated by market activity, such as past prices and volume.

 

Bonus or leverage. Bonus or leverage is the benefit that can be added to a trading account to provide for additional leverage and liquidity.

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