Key Points

• The New York Stock Exchange is preparing to launch binary options on major tech stocks.
• New contracts will provide fixed returns based on the results.
• Options linked to financial reports still require regulatory approval from the U.S. Securities and Exchange Commission

The New York Stock Exchange is preparing to launch "all-or-nothing" stock options in response to the growing demand from traditional financial institutions for predicting rapid market expansion and trading based on outcomes.

According to Reuters, the New York Stock Exchange (NYSE) expects its binary income options to begin trading within a few days after their announcement on October 27th. Initially, they will cover 12 securities, including SPDR S&P 500 and ETF Trust.

The New York Stock Exchange will bring about all-or-nothing trades for NVIDIA and Tesla

For example, if NVIDIA's closing price on the expiration date is higher than a certain specific price, the contract may pay a fixed amount; if the conditions are not met, the contract will be worthless upon expiration.

Nyx's ambitions are not limited to stock prices.

According to a separate proposal submitted to the U.S. Securities and Exchange Commission, the exchange hopes to launch contracts that are directly linked to a company's operational indicators, including quarterly revenue, earnings per share, cloud business sales, and automobile production.

These key performance indicator ( KPI ) options will be settled between $1 and $0 depending on whether the reported data meets the specified thresholds.

This concept provides another way to analyze trading financial report announcements, without having to rely entirely on the stock price's reaction after the financial reports are released.

However, the KPI contracts of the New York Stock Exchange still require approval from SEC. Competitor Cboe has already obtained authorization for similar products, which has intensified the competition between the established exchanges.

Kalshi A record $65 billion indicates growing demand

As the New York Stock Exchange expands, it is predicted that the market is attracting unprecedented trading activity.

According to the data released on October 28th, Kalshi has had a trading volume of approximately $65 billion so far in October, while Polymarket US has had a trading volume of about $10 billion.

Both platforms refreshed their respective monthly records before the end of October.

This wave of growth reflects an increased interest in contracts covering sports, political events, economic indicators, and financial asset prices in the market.

Traditional securities firms also benefit from this.

Robinhood In the third quarter, forecasted market revenue reached $173 million, exceeding its cryptocurrency trading revenue of $120 million.

The company demonstrated the commercial potential of this industry in the second quarter, when the revenue generated from event contracts was approximately 21% higher than that from traditional stock trading.

Growth has also extended beyond sports events.

Robinhood has recently listed Bitcoin and gold as categories in growth, indicating that there is a demand in the market for simple contracts linked to financial markets.

The product that the New York Stock Exchange plans to launch will bring similar result-based trading into the mature securities options ecosystem.

Regulation distinguishes the New York Stock Exchange from Kalshi and Polymarket.

Despite similar payment structures, the options to be launched by the New York Stock Exchange are still subject to different regulatory frameworks compared to traditional predictive market contracts.

Securities options on the New York Stock Exchange are regulated by SEC, while derivatives on federal regulatory platforms such as Kalshi are supervised by the Commodity Futures Trading Commission.

This distinction is important because contract design, liquidation requirements, and customer protection measures can vary depending on the regulatory authorities.

As explained by the regulatory comparison of Coinpaper, products that provide similar economic outcomes may still face significantly different legal requirements.

Author

Ethan Mercer is a financial journalist who covers cryptocurrency, stocks, and the global economy. He studied economics and finance before turning to market reporting, with a particular focus on Bitcoin, stocks, monetary policy, and investor sentiment. His work focuses on explaining daily market fluctuations as well as the broader trends behind them.