Matching System
The Chicago Stock Exchange’s (CHX) Matching System trading platform has been designed for full electronic trade matching and constructed to provide fully electronic cost efficient executions. CHX’s trading platform offered US broker-dealers access to a fair, open and neutral market place with diverse order flow from retail brokers, CHX Institutional Brokers, NASD market makers and CHX market makers.
The new platform is scalable, reliable and designed for the messaging rates of today’s equity trading environment. The new CHX Matching System performance characteristics should exceed the requirements for classification as an automated market under Regulation NMS.
Order-sending participants may route to the CHX Matching System by using the FIX and CMS protocols via existing order-sending participant or vendor connections.
Upon receipt of an order, the CHX Order Management System (OMS) will validate and route orders to the appropriate matching engine instance. Several matching instances will each handle processing for a set of issue symbols, which can be reallocated among matching engines to re-grade processing loads.
Once the matching engine receives an order, the order’s price is compared with resting limit orders in the book. If a match can be consummated at a price within the NBBO then the orders will be executed.
If the execution would occur at a price outside the NBBO then no execution will occur and the inbound order will be rejected. If no match is available, then an inbound order will be placed in the book and immediately quoted. If the order’s price would lock or cross the NBBO then the order will be rejected.
Orders resting in the book will be matched in price - time priority and according to the ranking. The Matching System matches orders on a share for share basis and inbound odd lot orders can match at prices outside the NBBO.
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