Above/Below binary options, are very similar to the hi/low option. But there is one fundamental difference:
In regular hi/low option, you predict if the price of the underlying asset will be above or below the current market price.
With Above / below options you predict if the price of the underlying asset will be above or below a certain pre-set price (ie strike price).
Let’s view an example:
The current gold price is $ 1,355.005. You think the price of gold will rise, and choose the Above option, and set a target price of 1355.586, invested $ 100, the expiry time to 3:15 minutes. If the gold price at maturity, rose above $ 1,355.586, you will get 245% return on investment. Getting 245% percent payout in 15 minutes is obviously quite attractive. The same principle is valid for below options, but the target price should be much lower than the current market price.
Lets view a Below put option video as an example:
Now, lets view an Above call option example: