US Binary Options: ICE enters market with ByRDs at NYSE Amex Options

Rick Steves

Having announced the new product back in 2014, the Intercontinental Exchange Group (ICE) is finally launching Binary Return Derivatives (ByRDs) into market on April 21, listed on the New York Stock Exchange, and competing against Nadex Exchange, the first legal U.S. exchange focused on binary options, and the Chicago Board of Options Exchange (CBOE). Unlike […]

ICE enters market with ByRDs at NYSE Amex Options

Having announced the new product back in 2014, the Intercontinental Exchange Group (ICE) is finally launching Binary Return Derivatives (ByRDs) into market on April 21, listed on the New York Stock Exchange, and competing against Nadex Exchange, the first legal U.S. exchange focused on binary options, and the Chicago Board of Options Exchange (CBOE).

Unlike over-the-counter (OTC) binary options, under immense strain as multiplying fraud scandals all over the world affect the credibility of its operators, the US has that form of trading tightly regulated, on-exchange, with transparency at all times. Traders can enter and exit as they please, thus being able to make trades based on varying risk-to-reward scenarios as long as there is a willing buyer or seller counterpart. The binary options exchanges make money from an exchange fee and not from a trade loser, as usually seen in OTC brokers.

The NYSE, part of the ICE, will have its Amex Options platform offering ByRDs starting on April 21, cash-settled and exercisable only at expiration options with limited profit potential and defined risk for both counterparts, based on an underlying equity security. The platform will be the first to offer ByRDs on equities and exchange traded products (ETPs) to retail investors.

Offering a fixed return of $100.00 per contract, risk oscillates according to the supply and demand mechanism, but never exceeding $100.00 per contract, less the premium received for selling the option.

NYSE Head of Options Ivan Brown said: “The introduction of Binary Return Derivatives, or ByRDs, on NYSE Amex Options gives investors access to a new, simple income-generation tool with the same level of flexibility as standard listed options, plus a straightforward, fixed return. We’re excited to offer investors these innovative and solutions-driven investing tools.”

To read NYSE ByRDs full documentation, click here.

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