Clearing Corp Greenlights Binary Options Processing
Published Date: 5/27/2026
Notice
Summary
The Options Clearing Corporation (OCC) is updating its risk system to start accepting binary options for clearing. This change helps OCC manage the unique risks that come with binary options, keeping the market safe and sound. The update is approved and ready to roll out soon, affecting traders and clearing members who deal with these new products.
Analyzed Economic Effects
3 provisions identified: 2 benefits, 0 costs, 1 mixed.
STANS updated to price and margin binary options
If you trade or clear binary options, OCC is changing its STANS margin model to price binary options using a Black‑Scholes framework, using the forward price and the implied volatility of a corresponding vanilla option, an adjustment term for market alignment, and a smoothing algorithm for implied volatility. OCC says these changes produce theoretical values used in margin calculations and will be used at launch and as market data becomes available.
Reduced risk of mutualized Clearing Fund use
If you are a clearing member, OCC says that by incorporating binary options into its margin methodology, OCC is more likely to collect sufficient margin collateral for binary positions and thus reduce the likelihood that it would need to use Clearing Fund contributions of non-defaulting clearing members to cover losses from a default.
OCC will clear European-style binary options
You may see new European-style binary options available to trade because the Options Clearing Corporation (OCC) is approved to accept binary options for clearing. OCC states it presently intends to clear binary options on equity indexes and intends to clear only binary options that fit the definition of a “security”; all initially proposed binary options would be European-style.
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