All PFG customer funds on deposit with Nadex are held by Nadex in fully segregated accounts at Nadex’s bank. Those funds, which represent a very small portion of PFGBest’s total customer segregated funds, will be held by Nadex until disbursement is directed by the regulators and the bankruptcy court. All PFGBest customer positions at Nadex expired on Monday July 9 and PFG has no remaining open positions at Nadex. Nadex incurred no loss as a result of its relationship with PFGBest.
Nadex is a fully regulated exchange and clearinghouse. We do not trade, either on Nadex or elsewhere. Nor do we leverage customer deposits through exotic investments; instead, we currently hold all customer deposits as cash in properly segregated bank accounts. Moreover, all products traded on Nadex are fully collateralized, which means that the funds used to establish positions on Nadex must actually be on deposit with Nadex in its segregated bank account prior to an order being accepted by the exchange. This process of checking each order against the funds available to support that order, referred to as “Cap Checking”, ensures that funds sufficient to cover the maximum possible loss on any trade (and conversely, to pay out the maximum possible profit on any trade) is collected in advance of the trade and held at the Nadex clearinghouse.
At Nadex, we take the integrity of the exchange and the safety of customer funds very seriously. Beyond adhering to the regulatory requirements for segregating customer funds, we feel that our fully collateralized products and the Cap Checks required by the Nadex Rules add additional levels of security that are not available on any other US exchange.
We thank you for choosing Nadex and for your continued business.
Should you have any questions or require further information, please contact the Compliance Department.