NYSE Arca proposes rule change to list binary KPI options
The exchange filed the proposal on Sept. 3, 2026, and the SEC is seeking comments through the notice published Sep. 15, 2026.
On September 3, 2026, NYSE Arca, Inc. filed a proposed rule change with the Securities and Exchange Commission (Release No. 34-106370; File No. SR-NYSEARCA-2026-93). The SEC published the notice on September 15, 2026 in the Federal Register (Vol. 91, No. 180, pages 59199-59216; FR Doc No. 2026-19139) to solicit comments.
The Exchange seeks to amend its rules to add Section 9, titled "Binary KPI Options," and to adopt Rule 5.96-O, which would set the applicability, definitions, and standardized terms for binary KPI options. The rule would define the underlying "key performance indicator" (KPI) as a financial or operating metric disclosed by an issuer in an earnings-related filing (Form 8-K, 10-Q, or 10-K).
Binary KPI options would be European-style, cash-settled contracts whose payout depends on whether the reported KPI meets or exceeds a pre-specified strike level. A call binary KPI option pays the exercise settlement amount if the KPI is at or above the strike; a put binary KPI option pays if the KPI is below the strike. The settlement value is the KPI value disclosed in the issuer's filing on the expiration date.
The proposal defines "Clearing Corporation" as the registered clearing agency designated by the Exchange, which may be the Options Clearing Corporation or another agency, and requires clearing and settlement through that agency in accordance with the Act and applicable rules.
The filing notes that the proposal is similar to recent proposals by Cboe Exchange, Inc. and MEMX LLC, and references the Exchange's website (www.nyse.com) for the full text of the proposed rule change. Comments are invited from interested persons during the comment period.
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