Nadex calculates the Expiration Value for all binary options and spreads using a consistent, transparent process. Both binary and spread contracts will end with the same expiration value if they both have the same underlying market and expiration time. Why? They are both derivatives of the same underlying market and that market can only have one price at a particular time.

Why is that important for you to know? Some binary options broker-dealers are not transparent. You simply have to take their word that they are giving you a fair outcome. As a CFTC-regulated, US-based financial exchange, Nadex plays by strict rules of professionalism and fairness. You can trust our pricing.

The settlement calculations for futures and currencies are slightly different:

## Futures Expiration Value Calculation

- Take the last 25 trade prices in the underlying market
- Remove the highest and lowest five prices, leaving the middle 15
- Average the remaining 15 prices and round to one decimal point past the precision of the underlying market. (For the Wall Street 30 we round to the same precision as the underlying.)

## Forex (Currency) Expiration Value Calculation

Unlike futures, which are traded on a central exchange, currencies are traded on a global network. Therefore the expiration value calculation is different, but the goal is the same: to get an accurate picture of the market and determine the trade outcomes fairly. Nadex calculates the expiration values for spot FX with different calculations under normal conditions and for highly active markets.

- When 10 or more midpoint prices between the best bid and offer (10 pips wide or less) are collected from the underlying market in the final 10 seconds before expiration of the contract:
- Nadex takes all midpoints collected (10 pips wide or less) and removes the highest and lowest 30% of prices. If 30% of the data set is a non-integer, the nearest rounded-down integer is used. We then average the remaining prices and round to one decimal point past the precision of the underlying market.
- If it takes more than 10 seconds to collect at least ten midpoint prices between the best bid and offer (10 pips wide or less) leading up to expiration of the contract:
- Nadex takes the last 10 midpoints (10 pips wide or less) before expiration and removes the highest and lowest 3 prices. We then calculate the average of the remaining 4 prices and round to one decimal point past the precision of the underlying market.

Nadex obtains its underlying market data from a proprietary forex data feed based on data from ten major banks.

## Nadex Economic Event Contracts

In addition to futures and currencies, Nadex offers binary options on economic events. The expiration value is the figure released by the designated reporting body. For example, the weekly jobless claims number is reported by the US Bureau of Labor Statistics.

## Spreads

Since binary options are all or nothing, if the option moves in the money—above the strike price—by even the minimum amount, you still receive the full $100 payout. For spreads, by contrast, a small increase or decrease in price just before expiration will have a relatively small impact on your final payout.

Nadex offers roughly 10,000 contracts per day, which expire at various times throughout the day. Below is a platform screenshot showing the Nadex US500 binary options and spreads expiring at 2pm ET. At 2pm Nadex will calculate the expiration value of every one using the same weighted average of the last 25 prices of the Indicative Index (last column).