IG Group’s U.S-based binary options venture is apparently trying to find new ways to attract clients in the highly regulated American market where deposit bonuses are not allowed. The North American Derivatives Exchange (Nadex) has submitted to the CFTC its intent to adopt a free trading incentive program, expected no earlier than September 16.
Nadex charges its members certain trading and settlement fees in connection with trades and contracts settled in-the-money. Under the proposed plan, the exchange will waive trading and settlement fees for all new members for a number of days directly correlating to the amount of funds they initially deposit into their trading accounts.
New clients who deposit between $100 and $499 will get one day of free trading, and the incentives will increase incrementally. The maximum number of free days offered under the program is five, reserved for members that make an initial deposit of $10,000 or more.
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The offer will only be available to clients who have not previously funded their account prior to the effective date of the program, or had a prior account that was funded but subsequently closed.
In its submission to the CFTC, Nadex explains that it believes that the temporary incentive program reflects a legitimate business justification for providing a limited fee waiver to a particular category of members, in order to encourage them to participate directly in Nadex’s markets. “Newly acquired active members attracted to the exchange as a result of the incentive program will bring added depth and liquidity to the exchange,” it added .
The program is labeled temporary by Nadex, however its commencement date has not yet been determined. At this point it will run for an indefinite period of time and Nadex will issue a notice at such time that it decides to discontinue or amend any of the terms.
In July, Nadex reported the volume of binary options and spread contracts traded on the exchange in the second quarter of 2015. The report reveals a 53% rise compared to Q2 2014, marking the second consecutive quarter of record volumes and continuing its upward trajectory.