"This is a revolutionary concept in the options market that will affirm our position as the most cost-effective exchange," said PHLX Chairman and CEO Meyer "Sandy" Frucher. "What this means is that upstairs firms, once they have reached the cap, will essentially be able to send all their additional orders to our options floor for no additional cost, and specialists can lock in their expenses at a fixed rate."
The cap fixes an absolute ceiling of $50,000 per firm per month for all transactions, classified as firm (proprietary) and firm facilitation, sent to the Exchange.
In addition, the rule filing also offers PHLX options specialists the opportunity to pay a fixed monthly fee for transactions in equity and index options, in lieu of the current structure whereby a specialist pays fees based on monthly volume.
Frucher continued: "These enhancements to our options business will benefit every segment of the market - the investing public should realize savings from better markets as upstairs firms are incentivized to send us more business over and above the cap, specialists can attract more orderflow and lower their cost of transactions, and our market makers will have more orders to interact with. Everyone wins."
The Philadelphia Stock Exchange (PHLX) was founded in 1790. The PHLX trades more than 2,000 stocks, 1,000 listed equity options, 13 sectors index options and currency pairs. For more information about the PHLX and its products, visit www.phlx.com.
