Nadex set to implement inactivity fee

Maria Nikolova

Direct Trading Members that have a dormant account will incur an inactivity fee of $10 per month.

North American Derivatives Exchange (Nadex), a subsidiary of IG Group Holdings plc (LON:IGG), has unveiled its plans to charge inactivity fees on dormant accounts.

Pursuant to Section 5c(c)(1) of the Commodity Exchange Act, as amended (“Act”), and section §40.6(a) of the regulations promulgated by the Commodity Futures Trading Commission (CFTC) under the Act, NADEX submitted to the CFTC on April 17, 2020 a notice about its plans to implement a dormant account inactivity fee of $10.00 per month.

Direct Trading Members that have a dormant account, that is, an account that has not engaged in any trading activity for a period of 12 consecutive months, will incur an inactivity fee of $10.00 per month.

If at any time a Direct Trading Member’s account is subject to an inactivity fee but the account balance less than $10.00, Nadex will reduce its fee to the amount of the remaining account balance bringing the balance to $0. No account balance will become negative as a result of the inactivity fee. A Direct Trading Member that engages in trading activity after a 12 month dormancy will not be changed an inactivty fee until the account again becomes dormant.

A dormant account that has a $0 balance may be terminated by Nadex pursuant to Rule 3.3.

Additionally, Nadex is amending the fees it charges duly appointed Market Makers.

After the changes, Nadex will charge its non-intermediated Market Makers an Exchange trading fee of $0.70 per contract per side (compared with previously charged $0.50) for each Binary and Call Spread trade executed on Nadex. and $0.50 per contract per side for each Touch Bracket Knock-Out trade executed on Nadex.

Regarding settlement fees, after the changes, Nadex will charge its non-intermediated Market Makers an Exchange settlement fee of $0.70 (previously $0.50) per contract per side for each Binary and Call Spread contract that settles in-the-money and $0.50 per contract per side for each Touch Bracket Knock-Out contract that settles in-the-money. If the total fee to be charged for the position exceeds the total settlement payout for that position, Nadex will reduce its fee to the amount of the total settlement payout for that position (that is, Nadex will not charge a settlement fee that exceeds a settlement payout).

Nadex will also be suspending the Wide Spread Surcharge Market Makers incur until further notice.

Changes to the Market Maker fee are set to become effective on May 4, 2020. The dormant account inactivity fee will be implemented July 1, 2020.

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