It’s really difficult to find out Popular Binary Option Assets as traders have different taste and preferences. In binary industry, assets are considered to be the basis of binary options trading. The Foreign Exchange market (Forex) is one of the biggest in the world with an average of $4 Trillion daily volume. This means that 4 trillion bucks are exchanged electronically everyday through Forex brokers, banks and other financial institutions. But we are Binary Options traders so what do we care, right? Believe it or not, currencies are the most commonly traded asset of Binary Options as well and basically 90% of the traded pairs involve the US Dollar and another currency. We can safely say that US Dollar is the star of binary options so let’s see how it stacks up against its major counterparts.
What Assets are Offered in Binary Options Trading
There are many types of assets offered in binary options investing. The reason why you should be aware of the different types of assets is because the movement of some assets in this from of financial betting can be predicted much easier than the movement of some other assets.
Below you’ll find a description and risk index of every underlying asset in binary options betting. Keeping these things in mind is extremely important in becoming a successful binary options trader. Especially remember the risk index attached to these assets.
Forex currency pairs are the most popular asset types in this variant of financial spread betting. This is because the forex market is the largest financial investing market on the planet. In fact, this from of financial investing itself was once a spin-off of forex trading before it became an independent business.
Trading on forex pairs is basically investing on the exchange rate of various currency pairs such as USD/EUR, USD/GBP, EUR/GBP and much more. Good-quality financial service providers offer a very large selection of forex currency pairs to trade on. When trading forex binary options, traders will have to predict the future exchange rate of a currency pair.
Predicting the movement of currency pairs is not necessarily that difficult. All it takes to know when a central bank is printing money to be 99% sure about the future movement of the exchange rate involving a currency. Read more about how to do this in our strategy articles.
Stocks are the second most popular asset types in binary options. Most common stocks include those of famous companies such as Apple, Microsoft, Amazon, AT&T, Google and more. Serious binary options brokers provide a very large selection of stocks including a lot of regional stocks such as Gazprom, French Telecom, BMW, and a huge number of others.
Predicting the future movement of stocks is actually easy in our opinion. If a company is doing well, then you should bet on the outcome that its stock prices would increase in the future. You may still lose a few contracts from now and then but overall you will always be able to generate profits.
Likewise, if a company is just about to release a new cool product then you can be pretty sure that its stock prices will increase in the future. Most professional traders prefer trading on stocks because the overall winning rate will in this case be much higher than in the case of other assets.
Binary options brokers also offer the possibility to trade on indices such as the DOW Jones, FTSE-100, DAX-30 and much more. Again, a serious binary options broker offers a very large selection of indices as well, including indices outside of the US as well such as indices from Germany, UK, France, Japan and more.
The movement of indices usually doesn’t changes hugely during a certain type frame. However, small changes in the market happen all the time. Small fluctuation in the value of indices is very frequent, meaning that predicting the movement of these types of assets can be a bit more difficult than in the case of other assets.
Commodity binary options trading is also permitted by brokers. At most binary brokers traders have the possibility to trade on the movement of various commodities such as oil, gold, silver, wheat and more. Trading on commodities is in our opinion highly underrated by traders.
Trading on commodities is in our opinion the easiest form of binary trading. It’s widely known in professional circles that predicting the future movement of commodities is extremely easy in binary options trading. The general rule is that almost every time the value of a commodity will go up during a certain time frame.
Some binary brokers also offer the possibility to trade on the outcome of certain events as well. Most traders however regard this form of investment rather to be more close to sports betting than financial trading. For this reason, so far only a limited number of brokers offer trading on various events such as presidential elections, the Academy Awards and more.
Predicting the outcome of some events is not that difficult. In 2012 it was pretty obvious that Barack Obama would be reelected as president of the US. However, it’s much harder to predict who wins the Academy Award for the Best Picture or who gets the next Nobel Peace Prize.
Popular Binary Option Assets
Most Traded Currency Pairs
Trading currencies is the most common type of underlying binary options assets in binary trading. When trading currencies, it implies investing on the currency pairs exchange rate. Traders can place trades in USD/EUR, USD/GBP, EUR/JPY and many more available.
1.EUR/USD – (More than 30%)
The pair leads with a comfortable advantage the race for the most traded asset and I must admit it’s one of my favorite pairs as well. It is also one of the most stubborn pairs, behaving like an untamed stallion sometimes and turning on a dime when news comes out. I can almost say that Euro and the US Dollar share a love-hate relationship, constantly battling for trend domination but no clear winner emerges and you will rarely see smooth trends on this pair, especially on the lower time frames. It’s nickname is “Fiber” but it’s not used so much and nobody knows exactly where it comes from: some say the Euro bills have fiber in them to give them durability and a distinctive feel; some say it’s because the Euro was invented in the fiber-optics era. But one thing’s for sure: everybody loves to trade the fiber.
2. USD/JPY – (More than 12%)
The second most traded pair on binary platform, also called simply the Yen or a more fancy name – Ninja. Well, the only connection between this pair and a ninja is the fact that ninjas come from Japan but anyway, from 2007 to 2011 the Japanese ninjas kicked the greenback’s a$$ big time. Since then however, the pair has been in a clear uptrend and it seems like the Americans found the ninja’s weak spot.
3. GBP/USD – (More than 10%)
Back in the day, a transatlantic cable was used between New York and London to synchronize the quote of the two currencies and as a result the pair got its nickname- the Cable. This pair is a great example of how support zones work: if you take a look at a zoomed out weekly chart of GBP/USD, you will notice the pair started to climb in mid 2001, finally reached a top in late 2007 and then dropped abruptly just to be stopped by the zone where the original uptrend started. Coincidence… or technical factors at work?
4. AUD/USD – (Less than 10%)
“G’day mate how r ya?” According to Mr. Internet this is a traditional greeting in Australia but I wouldn’t know much about that. What I do know is that Aussie (common slang for AUD/USD) is one of the most trending pairs and also one of my favorites. It might take a while, but when the pair finally starts to move, it does so in a very easy to follow manner.
The Others – (rest of the trading)
the rest of the commonly traded pairs are:
As you can see the last five pairs are not really so impressive in volumes but nonetheless, we can clearly see that currencies are the most loved asset among binary options traders.
Most Traded Stocks
There are several very good stocks to choose from when trading binary options, however, there are a few that may be better than others, and are most often available through almost any binary options broker. These stocks include:
- Apple, Inc. – Even with the loss of its founder Steven Jobs, Apple, Inc. continues to design and manufacture some of the best computer products and other similar devices to come to market. These include portable digital music and video players like the iPod, mobile communication devices such as the iPhone, and multi-functional tablets such as the iPad. Apple’s stock symbol is AAPL.
- Google Inc. – Google, with its stock symbol of GOOG, is another good choice for binary options traders who are seeking to invest in the movements of individual stocks. This company is well known for its search engine capabilities, as well as for the development of the Android mobile phone technology.
- Vodafone – Vodafone is considered to be the world’s largest mobile telecommunications network company, with operations in over 30 different countries. The stock symbol for Vodafone is VOD.
Other individual stocks that binary options traders may wish to consider in their investments include:
- British Petroleum (BP)
- Coca Cola
Most traded Indices
Depending upon the trading website/platform that is chosen by an individual, there are various indices that are available for trading. Some of the most important indices that are traded via the binary options arena include:
- Dow Jones Industrial Average (DJIA) – The DJIA is a price-weighted average of 30 individual stocks from both the New York Stock Exchange (NYSE) and the NASDAQ.
- S&P 500 – The S&P 500 is a U.S. stock market index that contains stocks of 500 large corporations that are located in the United States.
- CAC 40 – The CAC 40 (.FCHI) is the French stock market index that tracks 40 of the largest stocks in France based on their market capitalization.
- CAC Future – The CAC Future, or FCE, is a market that is based upon the CAC French stock market index.
- DAX – The DAX (.GDAXI) is a stock market index that is representative of 30 of the largest and most liquid German companies that are traded on the Frankfurt Exchange.
- FTSE 100 (.FTSE) – The FTSE 100 is a stock market index that is representative of 100 large British companies that are traded on the London Stock Exchange.
- Hang Seng – The Hang Seng (.HSI) is an Asian index that is based on 41 of the largest companies in terms of market cap that are traded on the Hong Kong Exchange.
- Dubai (.DFMGI) – This index represents the Dubai Financial Market General Index. It consists of a cap-weighted price index that is comprised of stocks of listed companies on the .DFMGI.
- Tel Aviv 25 – The Tel Aviv 25, or TA-25, is an index that tracks the prices of shares of the 25 companies with the highest market capitalizations on the Tel Aviv Stock Exchange.
Most traded Commodities and Precious Metals
Commodities have been traded for thousands of years and their price is influenced by many factors. All are affected by supply and demand while agricultural commodity prices are often determined by natural elements such as drought, floods and disease.
The price of energy commodities, such as crude oil and natural gas, can be particularly volatile and is often affected by wars and natural disasters that limit supply. The best time to trade in these commodities is often after the US Department of Energy releases weekly figures, which is usually 04:30 GMT for crude oil and 14:30 GMT for natural gas every Thursday.
Gold and other precious metals are often bought during periods of economic instability. The best time to trade in them is usually when inflation and liquidity are high.