TAIFEX Options Dynamic Price Banding Mechanism
To prevent erroneous trades, fat finger incidents and momentary intraday order book imbalances, TAIFEX plans to expand dynamic price banding mechanism to TAIFEX Options (TXO) in May, 2019. TAIFEX will check each new order (including limit orders, market orders and market with protection orders) and simulate a matched price based on the order book at the time. TAIFEX will reject buy (sell) orders with a simulated matched price above (below) the upper (lower) limit of TAIFEX’ dynamic price band. Upon receiving a combination order of options, each component (leg) of the combination order will be checked. If any simulate matched price of the components (legs) exceed its price band, the combination order will be rejected. |
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