Where Are Binary Options Traded? A Look at the Major Exchanges

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Just like stocks and other common investments, binary options are associated with specific exchanges. In some cases, you can interact with the exchange directly once you establish an account. Others only allow members to trade, but a person can place an investment through a member, such as a broker, even if they aren’t one themselves.

Regardless of whether you have direct interaction with an exchange, it’s important to have a general understanding of what they have to offer. Here’s what you need to know.

Binary Options Exchanges in the US

Two of the most commonly used exchanges in the United States are the Chicago Board of Trade (CBOT) and North American Derivatives Exchange (Nadex).

The CBOT was established as a commodity exchange, providing a platform for trades associated with agricultural products like corn and wheat. Over time, they expanded to include other opportunities, including binary options and futures contracts.

Only members of the exchange can trade through the CBOT, so many beginning investors will need to find a suitable broker to begin trading binary options here.

Nadex is dedicated to binary options and spreads, and offers both an online and mobile trading platform. The exchange boasts 5,000 hourly, daily or weekly contract options as available, as well as the ability to trade 23 hours a day, six days a week. Currency pair-oriented binary options, such as the British Pound/US Dollar, are popular here, as well as those associated with commodities like oil and gold.

Binary Options Exchanges in Europe

Functioning as an international exchange, the Eurex exchange is focused on the European derivatives, and is considered the largest options and futures market on the continent. It was one of the first exchanges to offer a completely electronic trading platform, eliminating the use of pit trading and open outcry.

Like the Nadex, currency pair trading on the Eurex exchange is particularly popular, though other options may also be available.

A Note About Exchanges

Just because an exchange is located in a particular country or on a specific continent does not mean that international trading-related options aren’t available. For example, the Nadex has options products for companies on the Tokyo Stock Exchange (Nikkei) and UK stocks associated with the FTSE.

Additionally, binary options also exist for certain events, such as the outcome of US Federal Reserve rate decisions and jobless claims data.

While binary options, at their core, are fairly simple to understand, the sheer wealth of opportunities means it is critical to understand which exchanges may be involved as well as the companies, commodities, currencies, or events associated with them. To get started, it’s wise to research a potential investment in advance, so you can fully understand the underlying associated with the investment, as well as examine binary options trading tips to help you get your footing more quickly, allowing you to make smarter trades instead of just learning through trial and error.

With time and patience, it is quite possible to generate significant profits through binary options trading. Which exchange is your favorite for trading binary options?


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