CBOE Relaunched the Credit Event Binary Option (CEBO), aka the CDS for the Rest of Us

While searching for a nice way to short some of the markets I am following, I stumbled upon this press release from the CBOE about what they call CEBOs:

Credit Event Binary Options contracts allow investors to express an opinion on whether a company will experience a "credit event" (bankruptcy). Due to inverse correlations between credit and equity markets, CEBO® contracts can be used as a hedging tool for individual stocks. The contracts also provide the advantages of price transparency available through a regulated exchange, currently unavailable in over-the-counter credit default swaps markets.

A CEBO contract has just two possible outcomes - a payout of a fixed amount if a credit event occurs or nothing if a credit event does not occur.

The CBOE, which first began trading single-name and basket Credit Event Binary Options in 2007, recently received SEC approval to amend the Credit Event Binary Options rules.

One change simplifies the terms of a payout for CEBO contracts, allowing CBOE to list CEBO contracts that specify bankruptcy as the only trigger for a payout.

The size of the CEBO contract payout if a credit event occurs has also been revised. If a bankruptcy occurs prior to expiration of the contract, the amount of the payout will be $1,000 per contract.

These CBOEs are hence nothing but some a simplified and exchange traded version of the CDS. While they are presented as an equity hedging tool, they remain nothing less than a credit speculation one. Although the fact the only credit event accepted is the bankruptcy one, make their use quite tricker...

Here are some more details:

• CEBOs translate CDS exposure into a transparent exchange traded marketplace.
• CEBOs are binary options that pay fixed amounts upon a streamlined credit event, which may include bankruptcy only.
• CEBOs are similar to fixed recovery CDS contracts but are exchange traded and can be purchased with an upfront premium that can be margined.
• CEBO premiums reflect a company's discounted Probability-of-Default during the contract's life.

Unfortunately, it seems like only 10 of them are currently available — and not those I was after:

Ticker	Reference Entity	Reference Obligation
AKS	AK STEEL CORPORATION	AKS 7.625% 2020 Sr. Notes
AMD	ADVANCED MICRO DEVICES, INC.	6.00% Convertible Senior Notes due 2015
ARM	MERITOR,INC formerly ARVINMERITOR, INC.	4.00% CONVERTIBLE SENIOR NOTES DUE 2027
AXL	AMERICAN AXLE & MANUFACTURING, INC.	9.25% Senior Secured Notes due 2017
HOV	K. HOVNANIAN ENTERPRISES, INC	61/4% Senior Notes Due 2016
HUN	HUNTSMAN INTERNATIONAL LLC	5 1/2 % Senior Notes due 2016
MBI	MBIA INC.	SENIOR INDENTURE (generic)
PMI	The PMI Group, Inc	Senior Debt Securities (generic)
SFD	SMITHFIELD FOODS, INC.,	Senior Debt Securities (generic)
THC	TENET HEALTHCARE CORPORATION	8 7/8% senior secured notes due 2019