Why Binary Prices?
There are several advantages of using binary prices instead of decimal odds:
1. Binary prices are more intuitive than decimal odds.
Ask a person on the street what they think the chances are of a certain event happening: they aren’t likely to say “I think it is around a 1.4 shot” or “I reckon it’s around 2/5 on”- most people would say “I think it has around a 70% chance of happening”. With binary prices, you are trading the percentage chance of the event occurring.
2. Trading is easier with binary prices than decimal odds.
When trading with decimal odds, in order to achieve an equal profit or loss regardless of the outcome of the market, the stake size needs to be continually recalculated as the odds vary. With binary prices, trading in and out of markets is easy – to achieve an equal profit or loss across all outcomes, all you have to do is get your net position on the market to zero. This can be done in BinarySoft BDI by simply setting your stake to the current net position and then placing an order accordingly. By monitoring your net position you can trade in and out of markets faster and more easily than with decimal odds.
3. The stake size does not need to be continually adjusted.
Compare a bet of ?100 at decimal odds of 1.01 vs. a bet of ?100 at decimal 100.0 – a huge difference in the amount of money being risked. With decimal odds you have to continually adjust your stake as the odds vary in order to risk the same amount. The equivalent of these two bets in binary prices is ?1 per point at a price of 99.0 and ?100 per point at a price of 1.0.
4. Binary prices enable both selections of a binary market to be combined into a single concise view of the market.
When viewing a binary (two-selection) market in BinarySoft BDI, all of the bets across both selections are combined into a single ladder-style interface. It also means that you can place a bet on the outcome of the binary market without having to worry about which underlying selection you should choose in order to place your bet. This combination of both selections into one concise view of the market is only possible when using binary prices.