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How to profit from the Alibaba IPO with trading binary options

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Alibaba trading at Anyoption before the IPO date

Alibaba Group Holdings Ltd.’s U.S. IPO will price its shares on 18 Sep and begin trading on 19 Sep 2014. Alibaba will debut on the New York Stock Exchange under “BABA” ticker and soon after that many binary brokers are expected to include the new trading asset.

Binary option traders can profit even before the IPO date by simply predicting the market value (not share price) of Alibaba at the end of its first day of trading. Anyoption is offering 6 possible outcomes at the end of the first trading day. Each outcome is considered as Alibaba option.

The available Above/Below options

Above

250 billion USD or above – 150% profit
230 billion USD or above – 100% profit
210 billion USD or above – 50% profit

Below

160 billion USD or below – 50% profit
140 billion USD or below – 100% profit
120 billion USD or below – 150% profit

alibaba_binary_options_anyoption

On each option you can buy from 1 to 20 units and you pay $50 per unit. For example you believe Alibaba market value will be 230 billion USD or above and you buy 5 units.

5 x $50 = $250 investment
100% profit means you will earn back $250 net profit if your prediction is correct

You can purchase max 20 units per option which means your max net profit could be $1.500 per option.

The closing level is the market value (not the share price) of Alibaba at the end of its first day of trading after IPO.

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.

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