The Boston Options Exchange (BOX) is easily lumped in with the
current wave of highly automated exchanges and alternative trading
venues that are upending the established market-structure order,
but its parent company, Boston Options Exchange Group, was formed
in 2002 by the Boston Stock Exchange, Montreal Exchange and
Interactive Brokers Group. With its 2004 launch, BOX introduced a
price-improvement model that allows for best-execution and
order-routing practices that are advantageous to investors.
Today the Boston venture also counts Citigroup, Credit Suisse,
JP Morgan Chase & Co., Morgan Stanley and UBS as co-owners. Its
new trading engine, Sola, now being rolled out, is significantly
faster than the previous technology, has expanded capacity, and has
prepared the exchange to participate with other options markets in
the national pilot of penny-increment pricing, slated to begin on
Jan. 26. BOX also plans to participate in the related quote
mitigation program to help manage the increased market-data
traffic.
One of the reasons our market share
stagnated was that we did not feel comfortable with the capacity of
our system. We've got that confidence now.
 "The tightening of
spreads from penny pricing will provide significant value to BOX
customers," Scott Morris, who in October was named the first CEO of
the Boston operation, tells Securities Industry News. "Our
new trading system, Sola, has been designed to effectively manage
the increased messaging from a decimal world and provide superior
response times."
|
