What are binary options? Binary options are a simple way to make a true or false prediction about the movement of a market. For example, if you think the price of gold will be higher by 1:30pm on Tuesday, you can make a trade to reflect that. You will either be right and make money, or wrong, and lose some. Binary options always settle at either 0 or 100, with the contract price reflecting how likely the market sees the event as happening. Traders can close their trade early to lock in gains or prevent additional losses, and potential profits and losses are always known.