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Binary Options Expiration Times

Your capital may be at risk. This material is not investment advice.
Written by trading expert:Professional Day Trader
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Short resume:
  • Author of the book Options Trading for beginners
  • Worked in finance in 12 years
  • Got a MBA in Finance, BA, International Business Administration And Marketing
  • Built a solid record of achievements through constantly developing financial markets
  • Traded on the most frequently utilized stock exchanges: TSE, LSE,NASDAQ, NYSE, Euronex Actively managed a 6-9 million dollar portfolio
  • Developed new and innovative trading systems and implemented them during trading hours
Matthew O'Connor is the author on the bestseller Option Trading for Beginners
Option Trading for Beginners - Written by Matthew O'Connor

One important element of binary options is the expiration time. You will get good returns on your investment in binary options if you manage to correctly forecast an asset’s movement during a specific time frame. This timeframe is called expiry of that particular option’s contract.
Understanding binary options expiration times is necessary to become an advanced trader. Besides the expiration times, you should also focus on the kind of assets and options to be selected.

What are binary Options Expiration Times?

Expiration time in binary options is the time limit of a binary option contract. The trader keeps in mind this time limit and forecasts the trades according to that only. In simple words, the expiration time is the deadline for a binary options contract.
If the forecasted trade does not move according to the trader till the expiration time, the trader loses money in that investment. If the forecasted trade moves in the trader’s favour after the expiration time, then the money invested will be lost. Only the happenings at the time of expiration matter.
The expiration time of binary options is displayed in the countdown clock form as traders are able to see the remaining time until the expiry of the binary option’s contract. After the expiration of the time, the trader is not allowed to carry out any action in the expired option contract.

How Are Expiration Times Established?

Most brokers of binary options offer previously fixed expiration time. However, there are some brokers who allow the traders to select an expiry time which fits their style of trading. There are commonly three kinds of expiry:
· Short Expiries
The range of this expiration time is only a few minutes. The commonest range for such expiries is one minute to five minutes.
· Medium Expiries

The option contracts which last from five minutes to one or two hours are the contracts with medium expiries. These contracts sometimes give better returns than option contracts with short expiries.
· Long Expiries
When the expiration range of contracts is between two and twenty-four hours, it is said that such contracts have a long expiry. These options can be forecasted at the earliest.

Most Optimum Expiration Times

The most optimum expiration times depend upon multiple factors, such as the risk factor of the required payout risk, expectations of traders, etc. The binary options contracts with short expiry time are difficult to forecast in comparison to binary options contracts with a medium or long expiry time. It is difficult because, in such a short time frame of just a few minutes, the movements of the assets can’t be predicted.
However, options contracts with short expiry times are the most exciting ones. Maximum traders agree on this point and feel that it is quite boring to wait for a whole day for an options contract to expire. In comparison to contracts with a long expiry time, the payout percentage of contracts with short expiry time is also higher.

NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future. In accordance with European Securities and Markets Authority’s (ESMA) requirements, binary and digital options trading is only available to clients categorized as professional clients.
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