US bourse BATS Exchange has received regulatory approval from the US Securities and Exchange Commission (SEC) to launch its proposed options platform and plans to go live before the end of February.
“With SEC approval granted for BATS Options, we are pleased to deliver on the schedule announced last summer with go-live likely in a matter of weeks,” said BATS CEO Joe Ratterman, in a statement.
The launch date is expected to be 26 February, subject to industry-wide options symbology consolidation and testing, upon which BATS Options will start trading options on 18 underlying securities, including cash equities and exchange-traded funds.
“Similar to what we accomplished in the equity markets, we will strive to bring more transparency and efficiency to the options market by offering a competitive alternative with straightforward pricing and a platform built on BATS’ second-to-none technology,” said Ratterman.
“From the beginning, we built the BATS Options system with the Options Symbology Initiative in mind and anticipate coming online as soon after the cutover as possible. We thank the OCC [Options Clearing Corporation] and OPRA [Options Price Reporting Authority] for working with us to meet our aggressive timeline,” added Jeromee Johnson, BATS vice president, market development.
The Options Symbology Initiative is a plan launched by OCC to simplify and standardise the symbols used for options. Testing for the new symbols started in September 2009.
In addition, BATS’s US equity exchange has altered its fees for routing orders to other venues, which it says is in response to its competitors increasing their remove rates.
Standard smart order routing fees will be increased to $0.0027 per share from $0.0026 per share, while trades in all tapes routed to NYSE Arca via BATS will also be charged at $0.0027, previously $0.0029 for Tape A and C securities. Orders routed to Nasdaq OMX will be charged at $0.0027 for Tape A and C securities, down from $0.0029. Trades in Tape B stocks will remain at $0.0029.
BATS also plans to charge 0.1% of the total dollar value for removing liquidity from its order book for orders executed below $1. The changes will come into effect on 1 February 2010, subject to approval from US regulator the Securities and Exchange
Commission.