MIAX PEARL Equities Expands Traded Symbols

Shanny Basar
MTS Expands in European-Denominated Corporates

MIAX PEARL Equities became the sixteenth US equity exchange last month and aims to add functionality and adjust its pricing model over the next 12 months.

Joseph Bracco, senior vice president, head of sales at the MIAX Exchange Group, told Markets Media that a couple of thousand shares were traded when the US equities exchange launched on 29 September with a low volume symbol, NTGR (Netgear Inc.).

Bracco said: “We’ve added another 52 low to medium volume symbols and will let that run for a week or two.”

The exchange began a phased rollout so member firms could make sure that settlement and clearing works. He continued that about 35 members have connected and are trading, and between 15 and 20 are in the process of joining.

“We hope to trade all symbols before Thanksgiving,” Braccos added. “We have a timeline for rolling out more symbols which can be accelerated or slowed down as needed.”


The exchange is owned by Miami International Holdings, who already operate three options exchanges as part of the MIAX Exchange Group.

MIAX is using an equity rights program as an incentive and participants include Citadel Securities, Hudson River Trading, Jump Trading Group, Simplex Trading, Susquehanna Securities, and UBS. Participants in the program have the right to invest in MIH in exchange for the prepayment of certain exchange fees and meeting liquidity volume thresholds.

Bracco said that if members perform at 100% of the equity rights program target, the equity exchange would have 5.5% of average daily volume by the end of the 42 months that starts January 1 next year.

Joseph Bracco, MIAX Exchange Group

“Based on past experience with prior ERPs we’d anticipate  members to perform at between 60% and 70%, so our share would be between 3% and 3.5%,” he added.

He continued that one of MIAX PEARL Equities’ competitive advantages is that the parent group has been operating options exchanges since 2012.

“This is our fourth exchange so we understand how to operate and treat everyone fairly,” Bracco added.

The group can also offer cross-asset pricing for trading on both an options exchange and the equity exchange. The genesis of launching the new exchange was customers of the options exchanges asking to use the same technology in cash equities. The technology means that the group’s exchanges perform well in times of high volatility according to Bracco.

He said: “Our matching engine is very robust and deterministic so what you see is what you get.”

The majority of US equities exchanges are owned by three exchange groups – Cboe, ICE and , Nasdaq,

“Our goal is to be a disruptor with a low-cost model and to raise the bar for customer service and technology innovation,” added Bracco. “Our priorities over the next 12 months are to add functionality and to adjust our pricing model, which is currently a flat rate for both fees and rebates.”


MIAX PEARL Equities went live after Members Exchange launched last month as the fifteenth US equity exchange. MEMX was formed last year by a group of financial firms.

Jonathan Kellner, chief executive of MEMX took part in a webinar last month with Shane Swanson, senior analyst at consultancy Greenwich Associates. Kellner said MEMX can be judged a success in three years time if the exchange has “meaningful” market share so members’ voices are heard.

“We are competing in 45% of the market so success varies between 5% and a double digit share,” he added. “It is likely to be in the middle of the range and we do not have a time horizon.”

DOJ investigation

There were reports at the end of last month that the US Department of Justice is interested in the market data fees charged by US cash equities exchanges which caused the share prices of Cboe, ICE and Nasdaq to fall.

Kyle Voigt, analyst at financial services boutique KBW, said in a report that the DOJ’s interest in this space is not new information. However, he said he understood investor concern as the DOJ may be taking a closer look at this issue than previously realized.

“It still sounds like early days for DOJ involvement (and more of a threat than an actual investigation), so this equities market data issue simply remains a headline risk near term,” Voigt added.

In addition the US Securities and Exchange Commission could still move forward with other proposals on broader market data infrastructure reform.

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