The Philadelphia Stock Exchange, which changed its name to NASDAQ OMX PHLX, trades its transactions in US dollars and provides at least 2600 options of equity and sector indexes. Located at 1900 Market Street in Philadelphia, Pennsylvania, the stock exchange has been a big game changer for the economy of this city. With the ever advancing technology, the stock exchange functions electronically and it trades with both the electronic trading and floor trading. The available products on this exchange are world currency options, equity options, broad based index options and sector based index options.
The exchange is the 3rd largest options market in America and it has verified being a powerful entity over the history of more than 2 centuries. It has survived throughout by changing names, a number of relocations, merges, as well as stiff competition with the New York Stock Exchange. Unlike the COMEX in the midwest which focuses on commodities like corn, oil and gold and silver bullion bars, the PHLX trades more than 2,600 equities and sector index as well as the US dollar currency options. It receives support from a number of companies and major investors.
Features
The Philadelphia Stock Exchange launched a funnel program in 2008 with Timber Hill LLC via an electronic trade match feature (ETMF) and an auto-book sweep functionality to provide 240 symbols of options. This ETMF allows the system to match incoming clients automatically and orders by broker dealers together with those orders stored in the professionals’ books. On the other hand, the Automated Sweep Function sweeps the professionals’ books automatically with regard to the movement in the stock market. These 2 features help in improving the workability of transactions in the system. Clients find it faster to execute transactions since most of the work is done with the automated machines.
This new auto book match is an advantage for each provider of order flows with the help of an electronic setup for the trades available. As this works, the turnaround times on the other hand, are eliminated through an immediate, reflex report. The firm quote rules, including the off-floor firm orders will also be automated. This helps it easy to interact with the inactive customer orders. These new features are a portion of the Phl XL, which is a fresh trading system for electronic options that enhances the position of the stock exchange as the most flexible market and blends the paramount floor-based and electronic trading attributes. The Philadelphia Stock Exchange helps market makers to deliver flowing quotes electronically and giving out a deeper, tighter market for trading. The PHLX can improve the electronic access for clients, market makers and broker dealers as it leverages the benefits of a floor-based trading environment.
The Transactions
To launch a trading career in this market, you might have to ferry a number of huge tippers and pass a number of tests to get a license. Actually, you can be able to trade devoid of having any of the 505 seats of the PHLX that can be leased for nearly 5,000 dollars per month or bought at a general price of 300,000 dollars. Previously, the price was 190,000 dollars, which increased due to a recent equity course in equity options trading. Clear off the seat’s cost, an option trader that has just joined the stock exchange is expected to have a capital of not less than $25,00. Failure to this, the majority of clearing houses will deny them a transaction processing. Though, to effectively start trading, you will at least need to have a $100,000 capital.
The Philadelphia Stock Exchange established the evening trading back in 1987 and the 24-hour trading that was majorly meant for currencies was introduced later in 1990. This was because traders were increasing majorly and they were more demanding for the services, which pushed PHLX to increase the working hours which in turn boosted the revenues. The trading hours for equities commence at 9:30am and runs till 4pm every day. However, there is a post-primary session that takes place from 4pm to 4:15pm, taking only 15 minutes after the main transaction hours. The equity options run from 9:30 in the morning, through 4:02 in the evening, whereas the Index option commences at 9:30, every working day in the morning and ends at 4:02 in the evening. Finally, the currency options working hours are from 2:30am to 2:30 pm, this option works for 12 hours due to the multiple transactions involved in the trading. In general, it is estimated that the company makes a yearly revenue of 130,000 dollars, which will fluctuate depending on the shareholders’ performance.
Article Resources
http://www.marketgypsy.com/philadelphia-stock-exchange.php
http://money.cnn.com/magazines/moneymag/moneymag_archive/1998/04/01/240376/
http://www.wallstreetandtech.com/photos/trading-floors/phlx
Summary
Having contemporary technological features, the Philadelphia Stock Exchange stands out to be among the best exchange in the US and due to the stiff competition, it has proven consistence in flourishing in revenue each year. The multiple employees that are well trained to make transactions even faster due to their well trained experience to reduce over-hassle of customers. The available 24-hour boosts trade and multiple transactions that can be made in a day, unlike other limited, 12-hour maximum working hours.
The Automated Option Market system, AUTOM, that is currently the majorly used option, was introduced to enhance the electronic conveyance of option orders from firms that are member to the exchange floor, specific orders automatic execution as well as electronic confirmation of customers’ orders. This system has been upgraded severally and it has changed over time to improve the transaction rates. However, it is the main execution system that is being used on the floor transaction. The Philadelphia Stock Exchange does not have equities trading floors that were used along with the options trading floor. Equities are traded alone via the exchange electronically. You can expect to enjoy many options in the exchange in addition to the varied working hours with the 12-hours currency options. The beneficial part is the post-primary option which helps customers majorly. There could be some training and advices offered to new investors in the market to ensure they lead a successful trading life at the exchange. You should keep in mind that the higher the capital you are investing in the market, will definitely yield more revenue. The transactions are well monitored will will ensure you have not been conned by any frauders, who barely are there, in the market