ISE Launches Speed Bump Thresholds Limiting FX, Options Risk Exposure

International Securities Exchange Holdings announced the substantiated enhancement of its ISE and ISE Gemini exchanges with the advent of a Market Wide Speed Bump, fortifying Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term capabilities for all traditional and Fx options, via an ISE statement.

Two Exchanges, All Options Needs

International Securities Holdings owns and operates two options exchanges, the International Securities Exchange (ISE) and Topaz Exchange, collectively specializing in ETF, Fx, equity, mini, and index options – its Fx options offering entails twenty different currency pairs. The company’s Market Wide Speed Bump initiative is designed to curb latent risk from cropping up in the form of overly broad market exposure.

The Market Wide Speed Bump acts as a parameter that melds with all existing options within the exchange offering, requiring risk thresholds for each options class. Furthermore, the Market Wide Speed Bump is designed to detect and search for multiple breaches in this framework within a defined timetable, culminating in the inactivity of a quote for the benefit of the user.

Market Wide Speed Bump a Governor of Options Risks

According to Boris Ilyevsky, Managing Director at ISE, in a recent statement, “The implementation of the Market Wide Speed Bump provides our members with an across-the-market safeguard over their quoting activity. This enhancement demonstrates our ongoing commitment to providing our Market Makers Market Makers Market makers or called dealing desk brokers represent a type of broker that internalize flows and are taking the opposite side of a transaction submitted by their clients. The market making broker is only quoting a feed of prices to its clients. These feeds may or may not be the exact same as the prices quoted on the interbank market.Any order a client enters is processed internally and never goes out to the market, except in rare cases where a market making brokerage identifies a client as a v Market makers or called dealing desk brokers represent a type of broker that internalize flows and are taking the opposite side of a transaction submitted by their clients. The market making broker is only quoting a feed of prices to its clients. These feeds may or may not be the exact same as the prices quoted on the interbank market.Any order a client enters is processed internally and never goes out to the market, except in rare cases where a market making brokerage identifies a client as a v Read this Term with sophisticated risk management tools and to protecting market integrity and resilience for all exchange members.”

Ultimately, the Market Wide Speed Bump should help govern and mitigate the risks involved in options trading across all types. By placing more stringent controls on quotes, ISE hopes that this new measure will foster safer and more compliant trading.