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Financial Betting 101: How to Bet on Finance

May 28, 2020 113 0
Financial Betting 101: How to Bet on Finance

Rapidly growing in popularity, financial betting is among the hottest trends in the online betting realm. With this type of betting, you can wager on the movement of financial assets, markets, and instruments via a financial betting site. For instance, you can make a bet that the value of silver is going to decline within the next hour. Financial betting sites provide a slew of betting options. If you’re just getting started with financial betting, this guide will help you understand what it is, where to do it, and much more. 

What Are the Financial Betting Types Available?

What’s fantastic about financial betting is that instead of purchasing the asset itself, you’re simply betting on whether it will move up or down during a specific period. Financial betting sites offer three primary types of bets you can place. You may select from spread betting, fixed odds betting, or binary options.

Fixed Odds Betting

Fixed odds are an excellent starting point for financial betting newbies. It is the most common and simplest bets you can make in financial gambling. Fixed odds financial wagers are pretty simple to understand. They also come with a lower risk compared to the other two options. If sports betting is your cup of tea, then fixed odds financial betting will come naturally to you, since they work similarly. 

For a fixed odds bet, you will wager on whether or not a financial asset will hit a specific preset price during a set period. For instance, you could bet on the price movement of crude oil in the next couple of hours. The financial betting site will display a list of price options to choose from. 

Spread Betting

Spread betting lets you speculate on the price movement of various financial instruments. These include commodities, forex, stocks, and fixed income securities. It is the riskiest type of financial wager available. Here, you have to decide which direction the financial asset will be moving in and determine how much it will move. Because of that extra layer of complexity, spread betting comes with more risk. But if you get it right, you will receive higher payouts. Also, considering the added complexity of spread betting, this type of wager is not advisable for newcomers to financial betting.

Binary Betting

If you wish to take things up a notch from fixed odds betting while having fewer risks than spread betting, binary options might be worth your while. With a binary option, you will determine if a financial asset or instrument will climb or drop in value within a set period. Unlike with fixed odds, you will not select an exact value for a binary option. Overall, you have six types of binary options to choose from.

  • Digital Options: Digital options are the most common type of binary options available on financial betting sites. What’s laudable about it is that you can get in on the action even if you’re not overly savvy. Here, you will decide if a financial asset will move up or down by the time the bet expires. Digital options are as simple as if you pick correctly, you will win your bet.
  • Touch Options: Compared to digital options, touch options are more specific and complicated. For a touch option, you need to determine if the financial asset will hit a specific high or low price before the wager expires. Note that your asset does not need to close at the touch value once your wager expires. You are in the money so long as the asset hits the low- or high-end touch values before the bet expires.
  • One-Touch Options: While a traditional touch option offers two touch prices, a one-touch option only has a single touch price. Therefore, it can be a bit more difficult than touch options. What’s great about a touch option is that it gives you more flexibility if the asset moves up or down. Whereas the riskier one-touch options offer only one touch price to reach to win your wager.
  • Range Options: When it comes to range options, you will bet on whether or not a financial asset or instrument will expire in a preset range. Such type of binary option is a bit more complex than both touch and digital options. Since your asset must end up in a specific range, you need a thorough understanding of the financial asset or instrument you are wagering on. 
  • Turbo Options: If you are in the market for quicker-moving action, you must check out turbo options. They are akin to digital options, in that you will wager on if a price will rise or fall within a specific period. But unlike digital options, turbo options occur rapidly over short periods. With turbo options, you will typically decide if the asset value will move up or down over the next five minutes. Results are instantaneous, so you do not have to wait days or hours like in a digital bet. Turbo options are worth trying for those who fancy digital options and want some more excitement.
  • Five-Ticks Options: If turbo options are too slow for your liking, five-tick options might just be what you are looking for. Here, you will wager on if an asset value will move up or down in five ticks. For those who do not know, a tick is a movement in a financial asset price. An asset can sometimes move multiple ticks within a couple of seconds. In most cases, your wager will expire in a matter of seconds. 

What Financial Instruments Can I Bet On?

Financial markets include currencies, stocks, commodities, indices, and precious metals. Below is a breakdown of each financial instrument to help you decide which is the perfect one for you.

Currencies 

From the mighty US dollar to the South Korean won, virtually every nation has a local currency. Exchange rate fluctuations are constant, and currency traders earn 24/7 by exchanging them at the perfect time. You may wager on which currencies will weaken or strengthen against others. Individuals can now bet on cryptocurrencies such as Bitcoin as well. 

Stocks 

Stocks refer to individual shares of companies like Microsoft, Apple, Tesla, Exxon Mobil, and so on. Simply put, if the firm itself is a cake, stocks are the slices of cake. You do not necessarily need to own them to make money wagering on their price direction. 

Metals

Gold, silver, and other precious metals fall under this category. You no longer have to purchase a gold bar and store it in your safe to make money on gold. All you need to do is make a wager on its price direction. 

Commodities

Commodities are agricultural products or raw materials that are sellable and purchasable. Like an individual company stock, the value of commodities fluctuates every day, depending on supply and demand. You can wager on the price direction of commodities for hefty profits.

Indices

Another option is to wager on the movement of major stock indices. A stock index lets you measure the value on a portion of the stock market. It forms a hypothetical portfolio to represent a sector or large market in general. The odds are that you already know about major stock indices such as the Standard & Poor’s 500 and the Dow Jones Industrial Average. 

Betting Regulations in North and South Korea

Casino gambling in North and South Korea is only legal for tourists. Both nations do not permit their residents to participate in any gambling activity offered by casino establishments. Casinos can only cater to foreign visitors. But there are always exceptions. Koreans are sometimes still able to engage in and enjoy casino games—even if it can only be possible illegally. Meanwhile, for other forms of gambling, South Korea is more indulgent than North Korea. It provides its residents with various types of entertainment. 

Per Article 246 of the Criminal Act of South Korea, any individual who participates in a betting activity to profit can face a fine of up to five million won. However, locals can engage in gambling activities for momentary pleasure. Those who fall under the habitual gambler category may face up to 20 million won fine or three years of jail time. The law applies to all South Korean citizens, regardless of where they play. 

Gambling is also illegal for North Korean citizens. Online gambling is also virtually impossible in the nation. But as mentioned previously, tourists are free to engage in any betting activities. In fact, the Democratic People's Republic of Korea used to have several casinos run by Chinese investors from Hong Kong and Macau. These casinos were a strategy by the government to lure more Chinese punters as the activity is illegal in their country. 

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