Firm: Direct Edge
What: Direct Edge has released new pricing for its exchanges. EDGA will go to maker-taker pricing model from taker-maker, which pays takers of liquidity.
Date: Pending SEC approval, Direct Edge is updating its pricing, effective July 1.
Background/Why: The pricing change was to give liquidity providers a greater incentive to post bids and offers in today’s low volume and low volatility environment.
Prospects/Expectations: By altering the pricing, Bryan Harkins, chief operating officer at Direct Edge, told Traders Magazine that he hopes to grow the overall liquidity pool and give liquidity providers a "material" rebate advantage and give the ability to quote tighter markets.
How it Works: Pricing will be as follows:
For Makers: REBATE (.0005) for Added liquidity
For Takers: CHARGE (.0006) for Removing liquidity
EDGA & EDGX Routing Changes:
The following flag will be adjusted to reflect the new change to EDGA:
Flag B – Add liquidity to EDGA book (Tape B) = (.0005)
Flag V – Add liquidity to EDGA book (Tape A) = (.0005)
Flag Y – Add liquidity to EDGA book (Tape C) = (.0005)
Flag W – Remove liquidity from EDGA book (Tape A) = .0006
Flag N – Remove liquidity from EDGA book (Tape B & C) = .0006
Flag 3 – Add liquidity – pre & post market (Tape A & C) = (.0005)
Flag 4 – Add liquidity – pre & post market (Tape B) = (.0005)
Flag 6 – Remove liquidity – pre & post market (All Tapes) = .0006