Proprietary trading system (PTS) Chi-X Japan will introduce a new maker-taker pricing model that rewards market makers with credit for posting passive liquidity.
For the month of January 2012, market makers will receive credit of 0.1 basis points for providing liquidity. The taker fee for removing liquidity will be 0.2 basis points. Chi-X Japan claims it is the first venue in Japan to offer such a credit.
The move is intended to be complimentary to the new post-only order type Chi-X Japan launched on 14 November 2011. The post-only order type is a passive order that never takes liquidity by trading against existing passive orders. A Chi-X Japan spokesperson explained that the post-only order is intended to help market participants who want to keep their costs down, since the venue does not charge for posting liquidity but does charge for removing it.
Chi-X Japan is currently in competition with the other main PTS in the country, SBI Japannext, over market share. Results have varied between the two firms over the last few months, with both slowly increasing their market share at the expense of incumbent exchange the Tokyo Stock Exchange (TSE).
In October, the TSE accounted for 90.77% market share, while the more derivatives-focused Osaka Securities Exchange had 4.23%. Of the remaining 5% market share, Chi-X Japan had 2.31%, while SBI Japannext had 2.45%.
Overall trading volumes in Asia have struggled recently, with volumes reaching a year-low of US$1.19 trillion in October, compared to US$1.28 trillion in September. Japanese equities volumes fell from US$341 billion in September to US$309 billion in October.