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Binary fed funds options

By Jennifer Hughes in New York

Published: August 7 2006 22:04 | Last updated: August 7 2006 22:04

Heads or tails? Those following the debate over the Federal Reserve’s decision on interest rates, due today, know that the arguments for and against a further rate rise have been anything but black and white.

Yet the Chicago Board of Trade’s new binary options on Fed funds target rates reduce it to just that; a win or lose, all-or-nothing, bet.

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