The Chicago Stock Exchange’s (CHX) Matching System trading platform has been designed and constructed to provide fully electronic cost efficient executions. CHX’s new trading platform will offer US broker/dealers access to a fair, open and neutral market place with diverse order flow from retail brokers, CHX Institutional Brokers, NASD market makers and CHX market makers.
The new platform is scalable, reliable and designed for the messaging rates of today’s equity trading environment. The CHX Matching System performance characteristics meet the requirements for classification as an automated market under Regulation NMS.
Order-sending participants may route to the CHX Matching System by using the FIX and CMS protocols via existing order-sending participant or vendor connections.
Upon receipt of an order, the CHX Order Management System (OMS) will validate and route orders to the appropriate matching engine instance. Several matching instances will each handle processing for a set of issue symbols, which can be reallocated among matching engines to re-grade processing loads.
Once the matching engine receives an order, the order’s price is compared with resting limit orders in the book. If a match can be consummated at a price within the NBBO then the orders will be executed.
If the execution would occur at a price outside the NBBO then no execution will occur and the inbound order will be rejected. If no match is available, then an inbound order will be placed in the book and immediately quoted. If the order’s price would lock or cross the NBBO then the order will be rejected.
Orders resting in the book will be matched in price - time priority and according to the ranking listed below.
The Matching System matches orders on a share for share basis and inbound odd lot orders can match at prices outside the NBBO.
The CHX Matching System accepts limit and IOC market orders.
The trading platform also accepts various cross order types that either execute or if not executed are rejected to the sender. Orders entered for ranking in the book must be DAY limit orders for regular way settlement. The Matching System also accepts reserve and do not display orders. See a listing of Matching System order types.
Additional supported time in force include Immediate or Cancel (IOC) and Fill or Kill (FOK). See CHX FIX Interface Specification for more detail regarding acceptable order modifiers.
Information on the CHX Only order type.
Effective September 28, 2009, there will normally be four trading sessions during each trading day. The first or Early Session will begin at 6:00 a.m. CT and operate until 8:30 a.m. CT. The second session is the Regular Trading Session and it will begin at 8:30 a.m. CT and end at 3:00 p.m. CT. The third session is the Late Trading Session and it will commence immediately after the close of the Regular Trading Session and will end at 3:15 p.m. CT. The fourth and final trading session is the Late Crossing Session, which operates from 3:15 p.m. CT to 4:00 p.m. CT. Only cross orders (with the exception of the mid-point cross) are eligible for entry or execution in the Late Crossing Session. IOC Market orders are not eligible for entry or execution during the Early or Late Trading Sessions. Unless otherwise designated by a Participant, open orders will carry over from one trading session to the next until the end of the Late Trading Session at 3:15 p.m. CT. For additional details, please refer to Information Memorandum 09-4 (Sept. 15, 2009).
Stocks eligible for trading in the CHX Matching System include NYSE, AMEX and Nasdaq stocks.
Gerry Sadowski, VP, National Sales