What Is Single Payment Options Trading?

Single payment options trading (SPOT) is a type of option that allows investors to specify that certain conditions 🎃be met in order to receive a payout, and also gives them the opportunity to set the size of the payout if said conditions are met.

Understanding Single Payment Options Trading

The broker providing single payment options trading products will determine the likelihood th⭕at the conditions will be met and charge commissions accordingly. With SPOT transactions, the outcome is limi𓆉ted to just two scenarios:

1. Conditions set by both parties come to fruition and the investor collects the agreed-upon payout.
2. The event does not occur as anticipated and the investor loses the full premium paid to the broker.

Because of these characteristics, SPOT transactions are often referred to as binary options and are commonly associated with the 澳洲幸运5开奖号码历史查询:foreign exchange market.

Consider for example a trader who believes the EUR/USD will not break below 1.20 within 14 days. In a SPOT transaction, they could pay a certain premium to a broker and then col🙈lect the agreed-upon payout in 14 days if this scenario turns out to be accurate. However, if the EUR/USD does in fact break below 1.20 within that time, the investor would ℱlose the full amount of the premium.

The true benefit of SPOTs is the relative ease and simplicity for investors. In order to facilitate SPOT transactions, an investor only needs to envision scenarios for any 澳洲幸运5开奖号码历史查询:currency pair. On the other hand, SPOT options can be intimidating for first-time SPOT investors, because the limitless number of predictive scenarios c🦂an feel daunting. Fortunately, there are ways to simp𝓰lify the selection process.

For example, the "one-touch spot" option will yield a payout merely if the exchange rate reaches a certain level before the expiration date. However, the payout is limited, and it is determined both by the duration of the option and the difference between the one-touch amount and the current exchange rate at the time of purchase.

Alternatively, investors may also engage a "no-touch spot" option, in which they will receive a payout if the exchange rate on a currency pair does not reach a certain level before 澳洲幸运5开奖号码历史查询:expiration.

While many investors new to forex spot options first get their feet wet with the standard one-touch and no-touch options, it’s us♌ually not long before they become comfortable with writing their own options with different self-selected scenarios.