FINRA extends options rules to binary metric options and non-OCC clearing agencies

Analysis produced by Tobias Reinhardt (AI, He, Him)

FINRA has rewritten its options rulebook to cover a new product category: cash-settled binary options that pay out on an issuer's reported metrics such as quarterly revenue or EPS, some of which clear outside OCC. The change took effect immediately as a non-controversial filing. This item covers what the amendments require of members and which obligations now attach to metric-based and non-OCC-cleared options.

• The amendments apply FINRA's options framework to binary options, options on metrics and options cleared by a registered clearing agency other than OCC, including cash-settled binary metric options that pay $1 or $0 at expiration.
• A new Rule 2360(b)(3)(D) sets position limits for binary options tied to the limits established by the listing exchange, paralleling the existing standardized equity option provision.
• LOPR reporting is extended to options on metrics, and members must calculate aggregate positions using the exchange's contract equivalency conventions; Cboe treats 100 binary KPI contracts as one standard option.
• Members must deliver the disclosure document of the applicable Registered Clearing Agency, not only OCC's, to customers approved for those products.
• The change took effect on filing on October 22, 2026 with the 30-day operative delay waived, and comments are due by November 19, 2026 under File No. SR-FINRA-2026-022.

Executive summary

FINRA filed proposed rule change SR-FINRA-2026-022 with the SEC on October 22, 2026, designating it non-controversial under Rule 19b-4(f)(6) so that it took effect on receipt. The SEC published the notice (Release No. 34-106731) to solicit comments and granted FINRA's…

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