Basic Sets of Data Affecting Forex Prices Basics of Options (Explained via Analogies)

Basic SPOT Options

One way to reduce risks while trading on the Forex is to buy SPOT options that have barrier levels already in place. The One-Touch Spot option will payout if the exchange rates merely rise to a certain level before the expiration date - they do not have to settle there - just reach it. There is also the No-Touch SPOT option where an investor will receive a payout if the currency rates never reach a certain level before the expiration date. These SPOT options limit risk to the premium paid but offer limited payouts as well. However, for those traders looking to limit risk while having the chance for unlimited profits, there are SPOT options that investors can write themselves (set strike price and expiration date) and receive the associated premium.