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Article 4.7.5


1.       Approved intermediaries shall express their willingness to trade through anonymous orders. Orders shall contain at least the information relative to the derivative instrument to be traded and the quantity, type of transaction, type of account, price and method of execution as specified in the Trading Service Manual of the IDEM market.

2.       Orders may be entered in the pre-auction and continuous trading phases with a limit price or without a limit price (“market orders”).

3.       Approved intermediaries may enter, modify and cancel orders in both the pre-auction and the continuous trading phases.

4.       Orders entered with a limit price in the continuous trading phase may be specified as being iceberg orders. The partial quantity displayed is established according the criteria set by Borsa Italiana in the Instructions. The execution of the whole displayed quantity shall automatically generate a new order. Such order shall be displayed on the book for the same partial quantity or the residual amount of the order with the price of the original order and the time priority corresponding to the time the new order was generated.

5.       The orders for each derivative financial instrument shall be automatically ranked on the book according to price — in order of decreasing price if to buy and increasing price if to sell — and, where the price is the same, according to entry time. Modified orders shall lose their time priority if the modification implies an increase in the quantity or a change in the price.

6.       The following types of order may be entered:

a)         “single order”, corresponding to a customer buy or sell order relative to a single contract series;

b)         “standard combination order” (Combo), corresponding to a combination of two orders relative to different contract series which are executed simultaneously when the appropriate market conditions occur. Borsa Italiana shall establish in the Instructions the operational strategies that may be the subject of standard combination orders;

c)         “quotations”, corresponding to bids and offers entered by the market makers referred to in Article 4.7.13 and the specialists referred to in Article 4.7.14 in compliance with their obligations;

d)         “flexible combination order” (FLEXCO), corresponding to a combination specified by the trader of up to a maximum of 4 orders involving different series, which must be executed simultaneously. Borsa Italiana shall specify the general characteristics of orders in the Instructions.

The types of orders referred to in subparagraphs b) and d) may be entered exclusively for the trading segments specified in the Instructions.

7.       Single orders referred to in paragraph 6a), may also specify the “stop-loss” method of execution in the continuous trading phase. This consists in the entry of an order that remains dormant until the market price of a financial instrument traded on the IDEM market reaches the (trigger) price chosen by the approved intermediary on entering the stop-loss order. The subject of the orders activated when the trigger price is reached may only be the financial instrument to which the trigger price refers. Stop-loss orders are activated when the market price is equal to or higher than, or equal to or lower than, the trigger price, depending on the condition specified by the intermediary on entering the order. When entering stop-loss orders, intermediaries may choose the market price to be compared with the trigger price from among:

a)      the price of the last contract concluded;

b)      the best bid price or the best ask price.

8.       Standard combination orders referred to in paragraph 6b) shall be displayed, with the methods of execution specified in the Trading Service Manual of the IDEM market, in a special book. FLEXCOs referred to in paragraph 6d) shall lead to the creation of a special trading book, if this is not already present in the system, on which the orders shall be displayed in the manner referred to in paragraph 5.

9.    Any single orders referred to in paragraph 6a) deriving from standard combination orders or FLEXCOs referred to in paragraphs 6b) and 6d) respectively vary automatically with market conditions. Single orders not deriving from standard combination orders or FLEXCOs shall have time priority with respect to any single orders deriving from standard combination orders or FLEXCOs.

10. The quotations referred to in paragraph 6c) may be entered exclusively with a limit price and without specifying a method of execution and shall be “valid for the session”.

11. Where the orders referred to in paragraph 6 relative to series of options contracts admitted to trading are entered for customer account, they must indicate whether they open a new position or close a previously opened position. Where such indication is omitted or the order was entered for own account, the order shall be automatically indicated as opening a new position.

12. Intermediaries other than market makers and IDEM specialists may request them to display quotations.

13. Limit orders may not be entered with prices above or below the maximum percentage limits for price variations established in the Guide to the Parameters notified in a Notice by Borsa Italiana.

14. In order to ensure the regularity of trading in a financial instrument, Borsa Italiana may establish on a general basis in the Guide to the Parameters notified in a Notice the maximum number of contracts that may be the subject of an order.

15. In order to ensure the smooth technical functioning and efficient use of the electronic trading support systems, Borsa Italiana may impose, inter alia for market makers and IDEM specialists alone, limits on the entry and modification of orders in terms of daily frequency, total daily number or the ratio of orders to contracts concluded. Borsa Italiana shall issue a Notice establishing such limits.

Last update:  November 9 2010 - 16:28


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