'Fixed odds financial betting' is on one of the newest ways of playing the financial markets. In essence 'binary' or fixed odds financial betting involves making a bet in the belief that you think a financial instrument (a stock, index or currency) is going to go up or down from where it is now. You can also bet on the belief that an instrument will touch, reach or bounce off a certain point. There are a few more permutations but the basics are as simple as that.
Fixed odds financial betting strips away the need for understanding complicated financial instruments like options or derivatives. Fixed odds financial betting is basically a simple method of learning how to trade as well as a means of limiting the risk for more experienced traders.
Fixed odds financial betting and binary betting employ something called a digital option. Digital options pay-out if an event (such as the FTSE rising above a certain fixed value) happens.
When you make a fixed odds financial bet, you are entitled to receive a payout, which is a fixed from the time of purchase. This means from the moment you bet, you know exactly what your gains will be, and your potential losses (Exactly the same as traditional sports betting). So there will be no surprises, and no replicating Nick Leeson!.
In fact fixed odds financial betting offers further added piece of mind. Unlike traditional sports betting your bet will have a re-sell value. This means that in most cases (certain conditions apply) you can sell back your bet before its expiry date, allowing you to take some of your profits early. The re-sell value of a bet will be anything between 0 (your bet has expired and you have lost) and the full value of the win.
Fixed odds financial betting is also unique in that you are required to state how much you want to win first. The fixed odds company will the calculate how much you will have to bet to win that amount if the conditions of your prediction become true.
Imagine you could bet on a horse race that's already underway, it has a field of over a thousand horses and has been going on for over a hundred years.
Let's say that you have information that a particular horse will suddenly turn lame and drop back. Imagine that you then place a bet that the horse will go lower in the field. That bet will reward you with one point, or one multiple of your bet, for every position your horse drops.
You bet £10 per point that the horse will drop back and the horse drops back 100 places. Imagine making £1000 tax free in a few hours through the click of a button. This is the reality of successful financial spread betting.
The main difference between fixed odds financial betting and financial spread betting is the fact that you are not limited by simple odds. What you are doing is predicting the direction a certain financial item will go from its present point. The more it goes in the direction you predicted, the more money you make.
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