RiskTech Forum

Bats Global Markets Expands Access Of Risk Management And Kill Switch Tools To All Members

Posted: 27 November 2012


BATS Global Markets (BATS), a leading operator of securities markets in the U.S. and Europe, today rolled out a suite of risk management tools available at no charge to all members of its U.S. equities and equity option markets to help them mitigate risk

Beginning today the tools are available to all members of the BATS BZX Exchange, BYX Exchange and BATS Options at no charge with no additional latency incurred on inbound orders to BATS.

The customizable port-level risk management tools, which had previously only been available to Sponsoring members, provide members with pre-trade risk protection by enabling members to set critical parameters for
orders and prevent unwanted executions. Some of the key features of the risk management tools include the ability to set order restrictions, maximum per-order limits, and order cutoffs, or a member controlled “kill
switch,” which would cancel all open orders and block new orders.

“Our risk management tools provide supplemental controls and safeguards to our members to help them mitigate risk and we’re pleased to be expanding access to these tools to all members. We believe that a multilayered approach to risk management, with various risk checks in place both on the member and exchange side during the life of an order, is fundamental to ensuring markets remain resilient,” said BATS Global Markets President and CEO Joe Ratterman. “Providing universal access to these types of risk management tools at no cost to our members supports our mission of making markets better.”

“We are confident that these risk controls and kill switch functionality will go a long way to responding to customer demand for exchange specific risk mitigation, and we also remain engaged with the industry in the U.S. and Europe on the potential development of market-wide risk controls that could further improve the market’s safe functioning as well as increase investor confidence in our markets,” he added.