Founded in 2004, the North American Derivatives Exchange—or Nadex—is a Chicago-based financial exchange that specializes in short-term binary options and spreads. The company was acquired by Crypto.com in March 2022. Binary options are legal and available to trade in the U.S. but only on a CFTC-regulated exchange like Nadex (you can also trade binary options through the Chicago Board Options Exchange).
Nadex customers can trade binaries and spreads on stock indices, forex markets, commodities, cryptocurrency, and macroeconomic events—such as the Fed funds rate and weekly jobless claims. Trading hours start at 6 p.m. ET of the previous day and run overnight until 5 p.m. on Monday through Thursday and until 4:15 p.m. ET on Friday. Nadex pauses trading each day from 5–6 p.m. ET for exchange maintenance.
Binary options are based on a simple yes or no proposition: Will an underlying asset be above a certain price at a certain time? Well-defined profit and loss limitations that are known in advance help make binary options attractive to a variety of traders and newcomers to the financial markets. Still, as simple as binary options sound, you should fully understand how they work—and what the risks are—before including them as part of your trading or investing plan.
Wide selection of binary options and spreads
Low fees and minimums
A good selection of educational content, including videos and webinars
Traders accustomed to European CFD brokers may find Nadex binary options a bit more complex
No bonuses or promotions
Research reports and tools are limited
While the binary options space has been known to be populated by fraudulent exchanges or scammers, Nadex is 100% legitimate and is designated by the Commodity Futures Trading Commission (CFTC) as a Designated Contract Market and Derivatives Clearing Organization. The CFTC is a U.S. government agency whose mission is "to foster open, transparent, competitive, and financially sound markets," to "avoid systemic risk" and "to protect market users and their funds, consumers, and the public from fraud, manipulation, and abusive practices related to derivatives and other products that are subject to the Commodity Exchange Act."
Funds on deposit with Nadex are held in segregated bank accounts at BMO Harris Bank and Fifth Third Bank and are never commingled with Nadex operational funds. In terms of privacy, electronic, physical, and procedural safeguards meet or exceed industry standards to keep your personal data safe and secure. In addition, Nadex's website clearly explains its products, markets, trading platform, and pricing structure. The firm's FAQ page is especially helpful for questions about accounts, funding and withdrawal, Nadex trading platforms, and trading on Nadex.
Nadex relies on a proprietary single web page desktop experience. The trading platform runs on any PC or Mac with a modern web browser and Internet connection. You can test-drive the platform to see if you like it with a free demo account that starts with a simulated $25,000 balance. When you're ready, you can open an account and fund it using a debit card, ACH, wire transfer, or paper check (non-U.S. residents can use a debit card or international bank transfer).
The trading platform is basic but well-designed, clean, and intuitive. Keep in mind, the platform is meant for trading binary options and spreads—it has everything you'd expect for trading those instruments but not much else. The charts are surprisingly customizable, and it's easy to switch between charting intervals (time and tick-based) and chart types (candlestick, line, HLOC, and Mountain). You'll find a small selection of technical indicators, including all the regular suspects like Average True Range, Bollinger Bands, Moving Average, RSI, and several oscillators. There's also a decent selection of drawing tools, including Elliott, Fibonacci, and Gann tools. You can click on any symbol to open an easy-to-use order ticket that supports limit and market orders.
In Aug. 2018, Nadex announced it would no longer support its binary option on iOS and Android apps. "As you may have heard, unregulated binary bucket shops have forced the hands of tech giants Apple and Google to ban binary option trading apps… Against our best efforts, we were forced to remove binary options from our iOS and Android apps in October  and May , respectively, despite being a U.S.-based, CFTC-regulated exchange," wrote Nadex CEO Tim McDermott in a company letter.
Nadex responded to the setback by developing a Nadex Beta project, a progressive web app (PWA) that requires no downloads or updates. Dubbed NadexGO, the PWA offers access to Nadex's full range of products with account management tools, real-time direct market access, and full charting and technical analysis features. You must toggle between the chart and order entry ticket, which may take some getting used to, but otherwise NadexGO offers the same user experience as the desktop version, just on a smaller scale.
Research Tools and Insights
The website lacks broad-based research and analysis on individual securities, and there are no third-party research tools either, so you're on your own to study up before placing your trades. You can, however, register for an ongoing series of webinars that include live technical analysis and market insights. In addition, a news section features timely commentary on the markets, including analysis of specific commodities, currencies, or sectors.
What is lacking in research and insight on the platform is made up for in education. Nadex takes great care to instruct users on what binary options and spreads are and how they work. Nadex makes it easy to understand these products and how to trade them. Its business depends on having successful traders who profit consistently over the long term, so it provides free trading courses and other resources such as trading e-books. From an introduction to binary options to advanced guidebooks on trading volatility and trend direction, the library of e-books and online courses and videos gives traders a solid education and a complete reference library to return to as they advance in their trading.
The Nadex platform is built specifically to trade binary options and spreads, so its features focus on facilitating those trades. Since Nadex is an exchange and not merely a broker, you get free streaming market data directly from the exchange. The price ladder charts let you place orders directly from a chart, and you can go from selecting your markets to chart analysis to order placement, all from one screen.
Nadex's binary options and spread contracts have built-in floor and ceiling levels, which means your maximum profit or loss is known in advance. In fact, the maximum possible profit and loss are displayed on the order ticket before you confirm the trade—and you can never lose more than this amount on the trade.
Nadex is a CFTC-regulated exchange where U.S. and international members can legally trade binary options and spreads. As a Nadex customer, you can trade binary options and call spreads on stock indices Forex pairs, commodities, and economic events: the Fed's funds rate, weekly jobless claims, and non-farm payroll.
Commissions and Fees
Nadex specializes in binary options and spreads trading, and its fees are calculated on a per-contract basis. The fee structure is straightforward at $1 U.S. per contract, up to a $50 maximum cap—even if you trade more than 50 contracts. You can exit a trade in one of two ways: by placing a second, opposite trade or by letting the contract expire.
Nadex has solid customer support, with easy access whether you are an existing customer or just thinking about opening an account. If you're already a Nadex member, you can contact customer support by phone or email any time from 3:00 p.m. ET Sunday through 5:00 p.m. ET Friday. Prospective customers can speak with a Nadex Account Specialist from 7:00 a.m.–8:00 p.m. ET Monday through Thursday and 7:00 a.m.–4:15 p.m. ET Friday. The website lists a toll-free number for U.S. callers and a dedicated line for international callers, but there is no TTY line for hearing-impaired customers and no live-chat option for those who prefer to get live help in real time.
What You Need to Know
Nadex is an excellent platform for short-term traders who want to engage in binary options and spreads trading using a U.S.-based, fully regulated exchange. Binaries and spreads are available on more than 5,000 contracts covering a range of forex pairs, commodities, stock indices, and unique products such as Bitcoin, along with the opportunity to bet on macroeconomic events such as the Fed funds rate. For those who are new to binaries, the educational resources are extensive and well-designed. Nadex is best suited for active traders interested in day trading and placing bets across a variety of products.
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