Wall Street Letter VOL. XLV, No. 31 – Sept. 30, 2013 | Page 9

3 – 9 OCTOBER 2013

FEE CHART

SUMMARY OF FEE
CH ANGES AT E XCH ANGES

SOURCE: EXCHANGE RULE FILINGS

WEEK COMMENCING 30 SEPTEMBER 2013
NAME OF
EXCHANGE

SUMMARY OF
CHANGE

NEW FEE

CHANGED FROM

EFFECTIVE
DATE

C2 Options
Exchange

Establishes
Responsible
Person fee

$500 one-time fee

N/A

Sep 25

Fee will be waived if the Responsible Person is also an Associated
Person at the same Trading Permit
Holder.

Nasdaq OMX
BX

Amends fees and
rebates for BX
Options Market
Makers in BAC,
IWM, QQQ, SPY
and VXX

$0 rebate to add liquidity (if contra
is a non-Customer or BX Options
Market Maker); $0 fee to add
liquidity (if contra is a Customer);
$0.45 per contract fee to remove
liquidity

$0.20 per contract rebate to
add liquidity (if contra is a nonCustomer or BX Options Market
Maker); $0.10 per contract fee
to add liquidity (if contra is a
Customer); $0.45 per contract fee
to remove liquidity

Oct 01

Intended to encourage BX
members to transact business on
the exchange and encourage BX
Options Market Makers to make
markets on BX.

EXPLANATION

DISCLAIMER: Most fee changes are effective upon filing. WSL notes fee highlights here, but additional changes may be made post publication. Please visit
exchange websites for the latest fee changes.

banking sides, run tests regularly
but they use data from an average
market day. Instead, they should be
taking data from off-days, such as
those where glitches did occur and
using that to test software.
Financial firms could take their
cues from outside the industry as
well, he said, implementing things
like more automatic testing at scheduled times with light system activity
or random testing, such as tests where
one portion of the system is guaranteed to shut down randomly to see
how the rest of the system responds.
“It forces a certain level of chaos
on the system… and there is no point
in pretending that it won’t happen,”
he said.
Separately, John Edge, managing
director of capital markets business
development at NICE Actimize, said
the markets have advanced too far
technologically to roll the technology back so the key now is to be able
to spot, stop and recover from these
types of glitches.
“You have to be able to monitor
your systems if you haven’t already
invested or increased your investing
in surveillance and be able to stop
and make sure you can roll back to a
state where things are working,” he

said, adding that the latter point is
not as crucial for brokerage stability.
Edge also said investment levels for
technology under discussion at the
exchange level to reduce the number
of glitches, such as kill switch technology and a backup for the securities information processors, will be
expensive mainly due to the level of
complexity inherent in the markets.
TECHNOLOGY

SunGard report
highlights challenges
at boutiques
A report released by SunGard and
conducted in partnership with
the TABB Group shows boutique
asset managers are feeling the
squeeze brought on by regulatory
requirements and the need for more
complex operational infrastructure
just like their tier one counterparts.
In the report, boutique asset managers benefit from the big
squeeze, but face bigger hurdles to do
business. Respondents noted the due
diligence and compliance burden is
now the largest barrier for 51% of the
202 global respondents, with the cost

of operations coming in as the next
greatest hurdle at 44%.
Among US boutiques, operations
was the third most common concern
(16%) while the ability to show an
institutional grade control system
came in second (17%), according to
data furnished by SunGard.
US managers are also expected to
be more likely to outsource in the
next year, according to the data, with
30% of US respondents saying they
would look at outsourcing operations
and IT as a way to reduce overhead.
Ed Lopez, executive vice president
of SunGard’s asset management
business, said the interest expressed
in outsourcing presents a significant
opportunity for the company, which
conducted the survey in part because
of an expectation that the space has
the potential for growth.
“We see boutique asset management
to be a burgeoning space,” he added.
Lopez noted that while outsourcing
has probably always been on the table
for these firms, the expectation was
that these tasks could be completed
in house with less cost and ongoing
independence. Post-crisis, the focus
has been narrowed to focus on core
competencies across all types of firms,
he added.

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