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Author: IlanBigfoot Three stars, 500 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 1203  
Subject: Re: What is a Binary Option or Digital Option Date: 9/19/2012 2:39 PM
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You can read more here:

http://en.wikipedia.org/wiki/Binary_option

The big difference is binary options have a fixed payout. Traditional options don't. The payout goes up the more you are 'right', i.e. if you buy a call because you think a stock will go up, the more it goes up (and the faster) the bigger your profits.

However, it would follow that binary options are probably cheaper to offset the open-ended possibilities.
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