Source: International Securities Exchange
The International Securities Exchange Holdings, Inc. (ISE Holdings) today announced the launch of the Cross Market Speed Bump, which allows Market Makers to establish a common risk threshold across both ISE and ISE Gemini.
If the Cross Market Speed Bump is triggered, a Market Maker’s quotes are automatically removed across all products and new quotes are prevented from being accepted on ISE and ISE Gemini. This new protection is an enhancement to the existing Market Wide Speed Bumpintroduced earlier this year and is the latest in ISE’s industry-leading suite of risk management offerings.
Boris Ilyevsky, Managing Director, said, “Risk management is of utmost importance to our marketplace and to our exchange members. The Cross Market Speed Bump guards Market Makers against a technical disruption that may impact their quotes on both of our exchanges, and can help to limit the harm done to market participants by these types of events. We continually strive to be a leader in risk management, and the introduction of this important cross market risk management tool is a first for the industry.”
The Market Wide Speed Bump and Cross Market Speed Bump build on an existing risk management feature which requires Market Makers to set curtailments on a class-by-class basis. If the specified number of curtailment events occurs within the specified time period on either market or on both markets aggregated, the speed bump is triggered.