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NYSE Amex Options launches Binary Return Derivatives

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The NYSE Amex Options platform of the NYSE MKT exchange will commence trading of Binary Return Derivatives (ByRDsSM) on 21 April. 

ByRDs are a new listed equity options product with limited profit potential and defined risk for both buyers and sellers. NYSE Amex Options is the first exchange platform to offer ByRDs on equities and exchange traded products (ETPs) to retail investors.

Trading on the NYSE Amex Options platform, ByRDs are based on an underlying equity security, such as a stock or an ETP. They offer a fixed return of USD100.00 per contract, based on whether the volume-weighted average price of the underlying security is above or below a given level on a defined future date. They also provide a capped maximum risk to the seller of USD100.00 per contract, less the premium received for selling the option.

ByRDs are cash-settled and exercisable only at expiration, unlike standard listed equity options. ByRDs share some of the same features as standard listed options, such as standardised expiration dates and clearing, and settlement at the Options Clearing Corporation.

“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,” says NYSE Head of Options Ivan Brown. “We’re excited to offer investors these innovative and solutions-driven investing tools.”

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