Chicago Board Options Exchange (CBOE) has received final regulatory approval from Securities and Exchange Commission and will launch basket credit event binary options (CEBO) 28 August. Initially, CBOE will list three basket CEBO contracts: two based on specific industry sectors (automobile and homebuilder) and the third is a high-yield composite basket. The contracts are call options which automatically pay out a cash amount each time a credit event is confirmed in any of the basket components during the life of the contract. CBOE will determine when a triggering credit event has occurred, and resolution and payout is pre-determined and binding. After a payout, the basket component that had a credit event will be removed from the contract and the contract will continue on with one less entity in the basket. The contracts will continue to trade until expiration or until all of the entities in the basket have confirmed credit...