ISE options exchange proposes punitive cancel charges for active traders

[theTaoTrader]

Quote from range:

The manual traders (including me) are just collateral damage caught in the crossfire between the exchanges and the computers.

Me included as well.

 

[Cdntrader]

Quote from metooxx:

You answered your own question ...

You think? maybe they are more afraid of losing volume to other exchanges? I don't know..I wish I did!

I see the BOX is closing in on 10% mkt share.

 

[theTaoTrader]

Quote from Cdntrader:

But isnt the fee required to "ease congestion within the ISE order system"?

Or is this just a bogus argument designed to hide the fee grab?

maybe they should upgrade their systems and forget the fee

The right thing for ISE to do is to use the fee to upgrade their systems. And then reduce the fee once their system can handle large traffic.

The fee makes some sense as it's fair in that if you use more you pay more. But the current cancel fee is too high.

 

[wilburbear]

Top of page 2 has SEC comment page for cancel charges coming to an exchange near you. Good luck all, in tomorrow's trade.

 

[murray t turtle]

Quote from theTaoTrader:/wilburbear

Not yet. People are developing automated order cancel/resubmit programs that work like market makers. This cancellation fee is meant to deter them.

Put in another way, without the fee the ISE will have network traffic problem once these programs are up-running. Options market making is very demanding on that aspect.

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Have to look into it some more, dont like user fees raised;
usually that 's another name for a stinking tax increase.

However TaTrader makes some good points and ISE is one of the better ones; try those links later maybe, they arent working except SEC link.

However that can be counterproductive to cancel too quick, when splitting bid ask, ;
especially liquid options.

 

[metooxx]

Quote from Cdntrader:

You think? maybe they are more afraid of losing volume to other exchanges? I don't know..I wish I did!

I see the BOX is closing in on 10% mkt share.

Just another in the series of predatory rules ...

 

[metooxx]

Quote from theTaoTrader:

The right thing for ISE to do is to use the fee to upgrade their systems. And then reduce the fee once their system can handle large traffic.

The fee makes some sense as it's fair in that if you use more you pay more. But the current cancel fee is too high.

The fee has nothing to do with traffic ...

 

[theTaoTrader]

Quote from metooxx:

The fee has nothing to do with traffic ...

traffic or "congestion within the ISE order system", or whatever you call it.

 

[murray t turtle]

Quote from wilburbear:

http://www.iseoptions.com/legal/pdf/proposed_rule_changes/SR-ISE-2005-31$Fee_Changes$20050629.pdf

Read it and weep. Your exchange could be next. Fees for canceling orders. And this on an all-electronic exchange, where a cancel is just an electronic "blip" running down an electronic pipe. In my opinion, you should steer orders away from the ISE.

If there's enough responses to this, I'll hunt down the SEC page for comments on impending rules and post it here.

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Wilburbear;
Still cant get that link to work, but had typed in /clicked several times;
iseoptions.com,
top of page click ''regulatory'',
click rule changes.

I wrote all 6 exchanges against the day order cancel/expire fees, good risk reward on stamps & paper;
but ISE,BOX,CBOE all as a rule give me pretty good fills.And PHLX,PSE do limit orders some also .

If you read it thoroughly ISE is doing this simply because of institutions splitting up thier orders to try avoid some cancel fees now;
which is taking up quote ''bandwidth''


ISE is above thier 50 day moving average.

5 to 1 ratio cancel fee seems fair;
dont cancel 5 to 1 that much now.

 

[ajacobson]

1. This will most likely become an industry norm.

2. It has nothing to do with institutional order splitting. Splitting is done to get midpriced trades. Half at .50 cents and half at .55 to average .525 .. this has nothing to do with the rule change. Plus these are fills.

3. It would only impact a very small number of firms and they really don't provide any liquity because they actually have ratios much higher than you can image. 5 to 1 or even 10 to 1 would be a relief. These are firms(or CMTA's for nonmember firms) that have absurd users.

4. I work for the ISE where I run education. Feel free to email me directly ajacobson@iseoptions.com