MEMX Options, a soon-to-be-launched options exchange, is planing to offer dynamic risk controls, according to MEMX CEO Jonathan Kellner.
“This risk management functionality will allow firms the ability to dynamically manage their risk exposure on our Exchange and should help facilitate more competitive markets as a result,” he told Traders Magazine.
“MEMX will compete the same way we have with the equity exchange – with a simpler, less costly, and more transparent way to access liquidity,” he added.
The exchange will adopt a price-time model and a maker/taker fee model.
On March 21, MEMX, a market operator founded by members to benefit all investors, completed a strategic equity round of funding led by Optiver, a global market maker, to support the launch of MEMX Options on August 7.
Additional firms participating in the round included new investors Belvedere Strategic Capital, Chicago Trading Company, and IMC, as well as existing investors Citadel Securities and Virtu Financial.
The creation of MEMX Options was driven by marketplace interest, according to Kellner.
“MEMX was founded to provide a voice for the needs of all market participants, and expanding into options will allow us to provide meaningful benefits to a broader range of market participants,” commented Kellner.
“We’re leveraging member feedback and will continue to do so, to help determine how MEMX Options will best add value to the exchange landscape,” he said.
MEMX will create an Options Market Structure Committee to help drive member focused improvements and advise on the ongoing evolution of the US Options market.
“As the fastest growing equities exchange, MEMX has a proven model in equities. MEMX Options will leverage the same technological advancements to increase determinism, reduce costs and drive competitive improvements for our options members,” Kellner said.
Since launching in the fall of 2020, MEMX has quickly grown to become the largest independent U.S. equities exchange and a significant source for liquidity in cash equities.
Over the past 24 months, according to Kellner, MEMX has offered a series of common-sense equity market structure proposals, such as accelerating round-lot reform, tick size and access fee reform, and the handling of marketable retail orders.
“This speaks to MEMX’s mission to create healthy competition and advocate for market structure reform that results in more efficient and sensible trading experiences for all investors,” he said.
“We fully anticipate being an active participant in market structure issues concerning the US options market and look forward to representing the needs of Options market participants,” he added.
