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Tuesday, August 20, 2019

Options Regulatory Alert #2019 - 18
REVISED - PHLX, NOM, BX, ISE, GEMX and MRX – Bid/Ask Differentials for “MKL,” "NDX" and "BKNG" Option Classes through September 20, 2019

Category:

  • Regulatory

Markets Impacted:

Contact Information:

Resources:

Effective June 24, 2019, the below market maker quote width requirements for options overlying MKL, NDX and BKNG on Nasdaq PHLX (PHLX), Nasdaq Options Market (NOM), Nasdaq BX (BX Options), Nasdaq ISE (ISE), Nasdaq GEMX (GEMX) and Nasdaq MRX (MRX) will be effective through September 20, 2019. The exchanges may, in their discretion, amend the bid/ask differentials by providing notice to members.

This is a revision to ORA #2019 – 15 to add bid/ask differentials for MKL option class for the NOM.

The PHLX, ISE, and GEMX bid/ask differentials for NDX and BKNG option classes,* PHLX bid/ask differentials for MKL option class and MRX bid/ask differentials for BKNG option class for electronic opening Valid Width Quotes and PHLX open outcry quotes are as follows:

  • If the bid is under $2, the bid/ask spread may be up to $1.50 wide.
  • If the bid is from $2 to $4.90, the bid/ask spread may be up to $2.00 wide.
  • If the bid is from $5 to $9.90, the bid/ask spread may be up to $3 wide.
  • If the bid is from $10 to $19.90, the bid/ask spread may be up to $6 wide.
  • If the bid is from $20 to $39.90, the bid/ask spread may be up to $12 wide.
  • If the bid is from $40 to $79.90, the bid/ask spread may be up to $24 wide.
  • If the bid is from $80 to $199.90, the bid/ask spread may be up to $36 wide.
  • If the bid is from $200 or greater, the bid/ask spread may be up to $44 wide.

The PHLX, ISE and GEMX bid/ask differentials for NDX and BKNG option classes; PHLX and NOM bid/ask differentials for MKL option class; and NOM, BX and MRX bid/ask differentials for BKNG option class electronic intra-day quotes shall be as follows:

  • If the bid is under $200, the bid/ask spread may be up to $20 wide.
  • If the bid is from $200 or greater, the bid/ask spread may be up to $22 wide.

Please note that an option series with an expiration of 9 months or greater is not subject to bid/ask differentials requirements.

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