SEC Approves Cboe EDGX Retail Price Improvement Program with Sub-Penny Pricing Exemption
AI-generated summary for informational purposes only. Not legal advice. See the original source for the authoritative text.
The SEC granted accelerated approval to Cboe EDGX's proposed rule change establishing a Retail Price Improvement Program. The program allows Retail Member Organizations to submit Retail Orders (Type 1: IOC only interacting with price-improving liquidity; Type 2: flexible TIF that can post or route) and permits any User to submit non-displayed Retail Price Improvement (RPI) Orders priced at least $0.001 better than the Protected NBBO. RPI Orders can be limit orders in $0.001 increments, MidPoint Peg, or Primary Pegged, but only interact with incoming Retail Orders and cannot remove resting Retail Orders. The Exchange will broadcast a Retail Liquidity Identifier when qualifying RPI interest exists. The order also approves amendments clarifying the behavior of Non-Displayed orders regarding posting, ranking, and execution in locked or crossed markets. A limited exemption from Rule 612 of Regulation NMS (Sub-Penny Rule) was granted to permit the $0.001 pricing.
AI-generated summary. May contain errors. Refer to official sources for legal decisions.
Key Changes
- Introduces Retail Price Improvement (RPI) Orders executable only against incoming Retail Orders at least $0.001 better than Protected NBBO
- Creates two types of Retail Orders: Type 1 (IOC, interacts only with price-improving liquidity) and Type 2 (flexible TIF, can post to book or route)
- Allows RPI Orders in $0.001 increments, as MidPoint Peg Orders, or Primary Pegged Orders
+ 3 more changes with Pro