Market Maker is defined as an OTP Holder or OTP Firm registered with NYSE Arca for the purpose of submitting quotes electronically and making transactions as a dealer-specialist through the new trading platform. A Market Maker on NYSE Arca Options is either a Market Maker or a Lead Market Maker (LMM) and can execute transactions electronically or from the Trading Floor.
Market Makers are required to apply for an appointment in one or more options classes. The Exchange will appoint one LMM per option class and an unlimited number of Market Makers in each class. The following chart indicates the number of issues per OTP that a Market Maker may select for appointment:
|Number of OTPs||Options Issues in Appointment|
|1||60 + bottom 45% of issues traded on the Exchange by volume|
|2||150 + bottom 45% of issues traded on the Exchange by volume|
|3||500 + bottom 45% of issues traded on the Exchange by volume|
|4||1,100 + bottom 45% of issues traded on the Exchange by volume|
|5||All issues traded on the Exchange|
The bottom 45% of issues traded on the Exchange means the least actively traded issues on NYSE Arca Options, ranked by industry volume, as reported by the OCC for each issue during the calendar quarter. Each calendar quarter, with a one-month lag, the Exchange will publish on its website a list of the bottom 45% of issues traded. Any newly listed issues will automatically become part of the bottom 45% until the next evaluation period, at which time they may or may not remain part of the bottom 45% list depending upon their trading volumes and resultant rank among all issues traded on the Exchange.
Market Makers may select from among any option issues traded on the Exchage for inclusion in their appointment. Market Makers are permitted to change the option issues that are included in their appointment.
Market Makers are required to trade at least 75% of their contract volume per quarter in classes within their appointment. Trades done on the Trading Floor to accommodate cross trades, regardless of whether the trades are in issues within or without a Market Maker’s appointment, are excluded from this calculation.
As a Market Maker, you will only be able to enter quotations in the issues to which you are appointed. If you wish to trade issues outside your primary issue class, you must do so by entering orders.
A Lead Market Maker provides continuous two-sided quotations throughout the trading day in their appointed issues for 90% of the time the Exchange is open for trading in each issue. This requirement applies to all of the Lead Market Maker's appointed issues collectively, rather than on an issue-by-issue basis. Compliance with this obligation will be ascertained on a monthly basis.
A Market Maker provides continuous two-sided quotations throughout the trading day in their appointed issues for 60% of the time the Exchange is open for trading in each issue. This requirement applies to all of the Market Maker’s appointed issues collectively, rather than on an issue-by-issue basis. Compliance with this obligation will be ascertained on a monthly basis.
An applicant for Market Maker registration shall file an application, in writing, with the Exchange on such forms as the Exchange may prescribe. NYSE Arca currently designates the Series 57 Exam as the qualifying exam for Market Makers. The SIE Exam is a coresquisite to the Series 57 and applicants must also pass this exam. Registered Market Makers who have previously passed a qualifying exam will not be required to take the current pre-requisite exams as a condition to their continued registration, or to renew registration within 2 years.
Exam sessions are provided at authorized Prometric Testing Centers throughout the United States and can be scheduled once Form U4 has been updated to request the “OM” registration.