The following is an interview with Banc de Binary founder and CEO Oren Laurent in which he gives insights into the difference between binary options and vanilla options, and why traditional investments have failed the markets. He also speaks about Banc de Binary's enticing affiliate programs.
Interviewer: So where and how have traditional investments failed the trading markets?
Oren Laurent: There's a quote I heard once: “when all else fails look for alternatives”, this strategy seems to be the new premise for investment managers all over the world. Now here's why: traditional investments have been a bust for the better part of the last 5-10 years and with good reason, failed speculation. Investors didn’t see what the future held when they invested in the first place. Now as a result a new trend has emerged over time and it's left investors with no choice but to look seriously at their investing options and alternative choices. Many investors have since discovered other opportunities to invest that included alternative investments with minimal risk and higher than average investment returns. Now they prove their worth year after year. Here's a nice fact, it's becoming a new strategy amongst leading investment firms to include alternative investments and place them into their client's portfolios, and this is just to guard against risk from traditional holdings. Alternatives that were once considered risky investments are now considered to be viable options. You can compare them to traditional investment results and it just proves itself. The trend is growing and it shows no signs of slowing down. Regardless of what has and is happening in the investment world, investors are always seeking safe, sound and profitable investments, and this is in order to grow their money year after year. With minimal risk of course. Now it seems that these opportunities are mostly found in alternative investments like binary option investing, particularly when everything else offers uncertain results. The alternative investment opportunities that were once considered risky are now considered viable investing options, when compared to the constantly poor results offered by traditional investments like stocks, bonds, currency futures and real estate investments.
Interviewer: You've said in past interviews that binary options are a simple way of trading underlying assets like currencies, so what is the main difference between binary options and vanilla options?
Oren Laurent: It's a question that actually comes up all the time. Binaries versus stock options. The difference between binary options and traditional stocks or vanilla options is something traders need to understand. Essentially binary options have only two possible outcomes, which is very different to standard vanilla options. Binary options have previously agreed upon fixed payouts, which are paid if a prediction of a possible price movement turns out to be right at the time of the expiry. Vanilla trading options have varying payouts depending on the size of the movement of the asset price in comparison to the strike price. Lets take a quick glance at stock trading with binaries. The first one would have to be payout profile: now this is one of the first factors to consider when trying to explain the difference between binary and vanilla options. The payout profile of binary options is predetermined and fixed, whereas it is variable and more volatile within vanilla options. In other words in a binary option trade a trader will be paid a fixed amount of money if his prediction was right, and if the option expires “in the money”. In a vanilla option trade the trader will make a profit that depends on the amount by which the price exceeds the strike price at the time of expiry. The second one is trading patterns: now a trading pattern is another factor determining the differences between vanilla and binary options. The latter may be traded on figures of inflation as well, particularly in the U.S such as a trade that would include lets say a producer price and consumer price indexes, this however is not as prevalent with vanilla trading options. The third one is out of the money purchases: another difference between vanilla and binary options is the ability to make out of the money purchases. The out of the money purchase on a binary option is comparable to seeking a cheaper vanilla option lets say. The basic assumption here is that at the time of expiry the strike price will be the same. In case of binary options the payout will be fixed while in the vanilla option the payout could, in theory I guess, be infinite. Now here's the basic difference, in essence the main difference between binary option trading and vanilla or stock option trading is defined by the movement of an underlying asset or financial instrument. In binary options movement between being out of the money and being in the money is typically fairly high paced. As opposed to the slower pace at which the same will move or affect a vanilla option. The payout for the vanilla stock option also depends on the size of the price movement, whereas the payout for binary options are not influenced by the size of the movement, but are either right or wrong, you get all or nothing, hence all or nothing options. In other words the difference between binary option trading and vanilla trading is determined by the respective payout profiles and trading patterns as well as out of the money purchasing and the movement form out of the money to in the money. It might get a little confusing here but again it's out of the money to in the money, now although the fixed returns of binary options limit the possible profit to be made, potential losses are also limited to a previously determined fixed sum. So you can't lose more than you invested, as such traders are less likely to lose huge amounts of capital if an asset moves down dramatically when they were trading binary options.
Interviewer: Banc de Binary has an affiliate system, tell us more about how this works and what the benefits are to affiliates.
Oren Laurent: What are affiliates exactly? Many people may be asking themselves “wait a second what is an affiliate? If I refer a friend am I an affiliate?” Not exactly. Affiliates are basically our partners, they are people that send us traffic to the website. They send us potential traders and we reward those affiliates by paying them a commission per potential trader that is sent to us. Now why do they send it to Banc de Binary? Firstly Banc de Binary is the best known brand. Binary options equals Banc de Binary and vice versa. Banc de Binary is a multi award winning firm at the very forefront of the binary options industry. There has never been a better time to partner with us. We're particularly honored to have achieved the position in the world finance 100 list alongside HSBC, Goldman Sacks, JP Morgan and so on. That would have to be the main reason you're choosing our binary options affiliate program. Secondly, we pay the highest CPA. We guarantee the most profitable and rewarding CPA plans in the binary options industry. A dedicated account manager will work with you to ensure that you receive the best rate possible. You can see how much you'll make with our payment plan. Thirdly frequent payouts. Banc de Binary guarantees frequent payouts to all affiliates, with our most valued partners receiving payment every two days. The exact frequency depends of the quality of relationship that we're able to build with you of course. You can read about the frequency and the methods, they're listed on our website. Fourth: highest conversion rates. All websites designs and landing pages are optimized for conversion purposes, then our spectacular brokers will contact your every lead, giving you the maximum possible rate of leads to actual customers. Now our brokers are financial experts, the best in the industry. With specialisms covering a range of tradable assets. The brokers work directly with clients, providing them live trading signals and teaching binary options strategy and money management. And last, promotions that customers want. We know what entices customers. Banc de Binary offers 100% deposit bonuses as well as special promotions throughout the entire year which allow new traders to take advantage of the market events that interest them.
Interviewer: Oren thank you very much
Oren Laurent: Thank you.
George Milios is the founder of onlineforextrading.net, the binary options and forex news portal which is dedicated to providing you with all the information you need to successfully trade.