This bet lets you set a barrier level above or below which the index must stand on the expiry date for you to win the payout. You would buy a bull bet if you believe the underlying security/index/currency pair will be higher than a certain level (also referred to as the barrier level) on the maturity date.
Example: [Pays 100 if the FTSE closes higher than X on date T]
Bull Bet (also referred to as Bull Contract) You would buy a bull bet if you believe the underlying security/index/currency pair will be higher than a certain level (also referred to as the barrier level) on the maturity date. (also referred to as the expiry date) If the market is exactly at your target level on the expiry date you will lose the bet.
Example: The Dow Jones index presently stands at 9260 points. You think the level of the index will continue to rise and will reach a level higher than 9300 within the next few days. So you price this bet: I wish to win «USD» «500» if in «7» days time, the «Dow Jones Index» is higher than 9300. After «calculating» the cost of the bet, our pricing engine returns you a price of USD240. (ie net potential winnings of USD500 minus USD240 = USD260) You are satisfied with these pricing terms and click on «Buy Bet». If, on the maturity date, the closing price of the index is greater than 9300 points you will receive a total payout of USD500. If the Dow Jones lingers on the original 9260 level and is quoted at 9270 on the maturity date, then you lose your stake of USD240 since this is lower than your target level of 9300. If the Dow Jones spikes to a 9350 level within two days of buying the bet but declines to the 9270 level on the expiry date, then you will still lose your USD240 stake.
Note Days to expiry are calculated as calendar days and not business days ie. A weekend counts when pricing a 7 day bet even though the NYSE is closed on Saturdays and Sundays. Our pricing system takes this in consideration when pricing bets.
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