Fixed Forex Options
Similar to traditional options (call and put), fixed options are based on a prediction of a rate’s location in a specified time in the future. In contrast, however, fixed options carry a defined risk and a defined reward.
An example of a fixed option is the One Touch. As the name implies this option is profitable to the owner if the specified rate is reached during the life of the option. For example:
- Option Type – One Touch
- Currency Pair – EURUSD
- Target Barrier – 1.5600
- Expiration – 1 Hour
- Value - $100
- Premium - $5
The above parameters describe a fixed option that will provide $100 to the owner of the option if the EURUSD reaches (touches) 1.5600 at any time during the next hour. The cost of this option is $5.
FxSpyderOptions.com offers 6 option types. Click on the links below for an explanation of each.
Similar to spot forex the options market is traditionally a “commercial access only market”. Access for the retail trader, up to this point, has been either non-existent or extremely limited.
This limited “big boy” access to options market is no surprise. It was designed by commercial entities such as banks and brokers for their benefit, not for the benefit of the trader. The extreme advantages options provide for the writers and buyers is no doubt something the large players in the industry desired not to share with the “little guy”, the retail forex trader.
Access to the forex options market is changing right now. FxSpyderOptions.com provides equal access to all participants in the fixed forex options market.
In contrast the spot market where the broker has all the advantages, the fixed options market provides participants equal access to both sides of the trading field.
Whether you are a retail trader with a $100 account, a retail trader with a $100,000 account, a bank or a broker, all participants have the ability to write (sell) and/or buy options.
To find out more about fixed forex options and how to trade them download this free
Fixed Forex Options E-Book.