New market model
DETAILED EXAMPLES OF THE FUNCTIONING OF THE NEW MARKET MODEL
Please, find attached a document with some detailed examples of the functioning of the new market model in some peculiar cases.
Please, download the relevant document.
TRADING HOURS
Start of continuous trading will move from 9:00 am to 9:05 am. Consequently trading hours will be 9:05 – 5:30.
This change applies to all SeDeX segments.
PRE-TRADE PHASE
Continuous trading shall be preceded by the “quoting period” or pre-trade phase.
The pre-trade session only allows the entry, modification or cancellation of quotes by specialists.
Other market participants different from specialists, cannot insert orders nor execute trades.
Pre-trade goes from 8:45 am until 9:05 am.
Specialists may insert quotes at their will between 8:45 and 9:03.
Specialists are obliged to insert quotes during the last two minutes of the pre-trade phase, i.e. from 9:03 until 9:05.
Pre-trade phase applies to all SeDeX segments.
NEW CALCULATION OF STATIC AND DYNAMIC PRICES AT OPENING
Static and Dynamic Prices, two trading parameters, at the start of continuous trading shall be set equal to the average of the quotes published at the end of the pre-trade phase.
This change applies to all SeDeX segments.
NEW REFERENCE PRICE CALCULATION
Reference Price at the closing of the market shall be calculated based on the quotes of the specialist instead of the best bid-ask.
This change applies to all SeDeX segments.
SPECIALIST OBLIGATIONS REINFORCEMENT
A) Obligation to post quotes continuously from 9:03 until 5:30 (i.e. during the last 2 minutes of the pre-trade phase and during continuous trading).
B) In case of total or partial execution of the displayed quantity below the minimum quotation obligation, the specialist has up to 1 minute to restore its quotes (instead of the current 5 minutes).
C) Maximum spread obligations, currently applied only to plain vanilla CWs, Leverage Certificates and Investment Certificates - class A, are extended to all market segments (see the Parameter Guide at the following link http://www.borsaitaliana.it/borsaitaliana/regolamenti/guide/guidav32_pdf.htm ).
D) Minimum quantity obligations (EMS), for th instruments listed in the segments affected by the new market model (see below),shall be calculated based on a countervalue of 5,000€. For the remaining segments, the current countervalue of 2,500€ continues to apply. After the Go Live, an extraordinary recalculation of EMS based on the new countervalue shall be performed and the relevant communication disseminated to the market.
NEW TRADING MODEL
For the instruments listed on the following segments:
-) Structured/exotic Covered Warrants
-) Leverage Certificates - class A (Turbo & Mini Future)
-) Investment Certificates - class B
During the continuous trading phase i twill be possible to trade only when the specialist is on the book and only inside the specialist quotes (extremes included).
In case of specialist absence from the book, trading shall be automatically suspended.