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IEX Announces: Displayed Orders and Non-Protected Top of Book Quote Feed

IEX Trading Alert #2014 - 023

Please Route To: Trading, Trade Support, and Technology

What you need to know:

  • IEX will add support for displayed orders, in addition to our existing hidden order functionality, targeting release on January 30, 2015
  • IEX will begin offering "TOPS", a real-time non-protected top of book quote feed, targeting release on January 30, 2015.
  • TOPS will be free for all Subscribers and available through existing cross-connects. Subscribers connected to IEX through an extranet provider should contact their provider about support for UDP multicast.
  • Any clarifications to the targeted release date of January 30, 2015 will be communicated as the date approaches.

Why is IEX making these changes?

As part of our roadmap to becoming a registered stock exchange, IEX will allow Subscribers to make use of its displayed limit order book functionality and order types.

This notice is coming well in advance of our roll-out to give Subscribers as much time as possible to adapt to new functionality on IEX, from a technological and systems perspective.

IEX will be communicating in detail in the near future about the features and behavior of the IEX displayed limit order book.

What does "non-protected" mean in practice?

The aggregated IEX displayed top of book interest is not a protected quotation (as defined under Rule 600 of Regulation NMS). The IEX top of book will NOT be disseminated through a National Market System Plan Securities Information Processor (SIP) because it will not be published by IEX to a national securities exchange or a national securities dealer association system. The IEX top of book will only be available through the IEX TOPS data feed.

This means that the best bid and the best offer in each security on IEX's displayed limit order book does NOT enjoy trade through protection under the Rule 611 of Regulation NMS, the "Order Protection Rule." Other Market Centers and Market Participants are not required to satisfy the IEX quote before trading at an inferior price. Therefore, subscribing to the IEX top of book data feed is optional.

Please note IEX has in place policies and procedures, as well as technology, reasonably designed to prevent the IEX TOPS feed from locking or crossing any National Market System Quotation.

What is IEX's TOPS feed?

The IEX top of book quote feed, TOPS, is a direct data feed product.

  • TOPS provides IEX's aggregated best quoted bid and offer position in real-time for all securities on IEX's displayed limit order book.
  • Quotes are non-attributable to individual Subscribers.
  • Hidden orders, and the non-displayed portion of Iceberg orders are not represented in TOPS.
  • Trades (e.g. Last Sale) are not included in the TOPS feed.
  • TOPS cannot be used to enter orders.

TOPS data originates from IEX's matching engine located in Weehawken, NJ before traversing IEX's patent-pending anti-colocation architecture (IEX POP) to reach the IEX point-of-presence in Equinix NY5, located in Secaucus, NJ. Subscribers will be able to consume TOPS at the IEX point-of-presence in Equinix NY5.

IEX plans to deliver TOPS using the IEX Transport Protocol (IEX-TP) on UDP multicast for sequenced delivery.

How can firms make use of the IEX TOPS feed?

Firms can utilize the IEX top of book quote to identify available displayed interest in the IEX displayed limit order book.

All IEX quotes are firm and automatically executable against incoming interest.

An IEX Market Data Agreement will be made available on our website next month.

What should I do with the TOPS and IEX-TP specs?

Technology teams, both Market Data and Smart Order Router team, should write parsers to consume the TOPS feed via IEX-TP and use the quote information in routers to capture displayed liquidity on IEX.

All incoming orders will have the opportunity to trade against both displayed and non-displayed interest on the IEX Book.

When can I test these changes?

A Subscriber communication detailing testing conditions, environment and accessibility will be distributed in December.

Where can I learn more?

About IEX

Dedicated to institutionalizing fairness in the markets, IEX provides a more balanced marketplace via simplified market structure design and cutting-edge technology. IEX operates a fair-access platform accessible by any qualified broker dealer. IEX is driven by a team of cross-industry experts with backgrounds spanning market venues, electronic trading, and broker-dealers. IEX is the first equity trading venue seeded exclusively by a consortium of buy-side investors, including mutual funds, hedge funds, and family offices. Learn more at: