U.S. Options

Please be advised that MIAX has identified a technical issue related to behavior at the conclusion of the Price Improvement Mechanism (“PRIME™”) auction that has the potential to cause an improper execution following a PRIME™ auction.  PRIME™ orders and responses are traded properly in all cases and are not affected by this issue.

While MIAX has confirmed that no instance of this issue has occurred since the launch of PRIME™, MIAX Trading Operations will proactively monitor the system and inform affected participants in the event of a future occurrence.  This issue will be addressed in an upcoming release and announced in a Technical Alert upon completion of the rollout.

The issue only occurs during the following circumstances where a PRIME™ auction terminates early due to certain incoming interest (and following the PRIME™ execution itself), the MIAX system may not trade, or may trade at an improper price with certain remaining resting interest (orders and/or quotes) that are disseminated as the MIAX Best Bid and Offer (MBBO) against subsequent inbound interest.

The pre-condition for the specific problem scenario must meet ALL of the following criteria in order to occur:

• A PRIME Auction must be in progress; and
• Incoming non-routable unrelated liquidity (order or quote) on the opposite to the agency order is received; and
  • locks or crosses the ABBO or MBBO; and
  • terminates the auction; and
  • is priced better than any resting AOC; and
  • rests on the book and gets managed against ABBO.

If the above preconditions exist, and the resting order is marketable against incoming interest, the trade engine will not trade at the proper disseminated MBBO.

If you have any questions please contact Trading Operations at (609) 897-7302 or TradingOperations@miaxglobal.com.

Please direct any regulatory questions to the Regulatory Department at (609) 897-7309 or Regulatory@miaxglobal.com.