Market Making & Liquidity Provision

Liquid and well-functioning secondary markets allow investors to buy and sell their assets quickly and efficiently. Cboe Australia has commercial programmes to incentivise eligible firms to improve liquidity on the Cboe Australia market.

Cboe Australia Market Maker Fee Programme

The Cboe Australia Market Maker Fee Programme (“Market Maker Programme”) provides fee relief for eligible market makers registered with Cboe Australia when meeting liquidity requirements in eligible symbols. The eligible symbols currently include the majority of Australian ETFs quoted on ASX and Cboe Australia (note that funds with internal market making arrangements are not included). Market makers play a crucial role in providing liquidity, particularly for investment products, by providing quotes throughout the trading day priced at or close to fair value.

Features and Benefits of the Market Maker Programme

Features of the Market Maker Programme

• A broad range of eligible Australian ETFs
• Straight forward application process
• No obligation to provide liquidity that meets the liquidity requirements (subject to ongoing performance monitoring to remain in the Market Maker Programme)

Benefits for Registered Market Makers

• Recognition on the Cboe Australia website as a registered market maker, showing your firm's commitment to providing liquidity
• Customised reports for registered market makers to track their performance
• Certain trading fee relief when they meet the liquidity requirements
• For registered market makers that are Cboe Australia trading participants, certain connectivity fee relief when they meet additional liquidity requirements

How to Become a Registered Market Maker

Generally, a firm must (1) hold an appropriate licence or exemption required to participate, (2) be either a Cboe Australia trading participant or have an arrangement with a Cboe Australia trading participant and (3) agree to the terms and conditions of the Market Maker Programme. The application process is:

1. contact Cboe AU Sales to sign sign an application form;
2. choose the symbols for which your firm would like to register; and
3. assign a reference to identify trading messages submitted in its capacity as a market maker registered in the Market Maker Programme.

Additional Liquidity Provider Scheme Fee Programme

The Additional Liquidity Provider Scheme Fee Programme (“ALPS Programme”) provides fee relief for eligible liquidity providers registered with Cboe Australia in relation to trades resulting from lit orders above a minimum size that either set or join the National Best Bid & Offer (NBBO) in stocks in the S&P/ASX 300 Index. Liquidity providers play a key role in improving the market quality of Australian Equities trading by enriching lit liquidity at NBBO.

Features and Benefits of the ALPS Programme

Features of the ALPS Programme

• All stocks in the S&P/ASX 300 Index
• Straight forward application process
• Eligible executed orders qualify for relief with no ongoing obligation (subject to ongoing performance monitoring to remain in the ALPS Programme)

Benefits for Registered Liquidity Providers

• Customised reports for registered liquidity providers to track their performance
• Trading fee relief resulting from eligible executed orders that either set or join the NBBO on Cboe Australia

How to Become a Registered Liquidity Provider

Generally, a firm must (1) hold an appropriate licence or exemption required to participate, (2) be either a Cboe Australia trading participant or have an arrangement with a Cboe Australia participant and (3) agree to the terms and conditions of the ALPS Programme. The application process is:

• contact Cboe AU Sales to sign sign an application form; and
• assign a reference to identify the proprietary flow participating in the ALPS Programme.