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A binary option is a type of options contract in which the payout will depend entirely on the outcome of a proposition.
The proposition typically relates to whether the price of a particular asset that underlies the binary option will rise above or fall below a specified amount. A binary option does not give the holder the right to purchase or sell the underlying asset. When the binary option expires, the option holder will receive either a pre-determined amount of cash or nothing at all.
Binary option is suitable for scalper traders or the price action trader.
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