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Updated Exchange Transition Plan and Test Opportunities

IEX Trading Alert #2016 - 002

Please Route To: Trading, Business, Market Data Technology, and Trade Support

What you need to know:

  • On December 18, 2015, IEX granted the SEC a 90-day extension on its Form 1 application for registration as a national securities exchange, which expires on March 21, 2016.
  • Pending SEC approval, IEX will transition the IEX ATS to Investors Exchange using a security-by-security phase-in approach over a two-week period in May 2016.
  • IEX is offering five (5) Saturday test opportunities from March to May 2016.
    • Additionally, effective Monday, November 23, 2015, the Securities Information Processors ("SIPs") have been offering nightly testing opportunities.
  • Details regarding third-party identifier information, behavior during the transition period, and the "Exchange-only" TOPS feed may be found in IEX Trading Alert #2015-030 and the Investors Exchange FAQs.

When and how will IEX ATS transition to Investors Exchange?

As previously announced, pending SEC approval, IEX ATS will transition to Investors Exchange using a security-by-security phase-in approach similar to that used by Electronic Communication Networks ("ECNs") who transitioned to national securities exchanges in the past.

Pre-launch Period: To ensure a smooth transition of trading from IEX ATS (the "ATS") to Investors Exchange (the "Exchange"), there will be a three-week pre-launch period during which participants will be able to enter test orders on the Exchange using test symbols.

Phase-in Period: Following the launch date, there will be a two-week phase-in period during which securities currently trading on IEX ATS will be migrated from the ATS to the Exchange. Once a security is migrated from the ATS to the Exchange, it will no longer be available for trading on the ATS and will only be available for trading on the Exchange. Once the Exchange begins trading its first non-test security, it will operate in conjunction with the ATS until all securities are fully transitioned.

The objective of migrating securities in this manner is to promote a stable, predictable trading experience for market participants and technology partners. The schedule is as follows:

  • Apr 25 - May 12 (M - Th): Test symbols transition (pre-launch period)
  • May 13 - 17 (F - Tu): 2 non-test symbols ("Launch Date", phase-in period begins)
  • May 18 - 19 (W - Th): 10 non-test symbols
  • May 20 - 23 (F - M): Y-Z symbol range
  • May 24 - 25 (Tu - W): V-Z symbol range
  • May 26: All symbols (phase-in period ends, ATS ceases operation)

When can I test Exchange functionality, including identifying IEX quotations on the SIP?

IEX will offer the following Saturday testing opportunities in advance of the Exchange launch:

  • March 5 (Sat.): 1st Member Testing Opportunity
  • March 19 (Sat.): 2nd Member Testing Opportunity
  • April 9 (Sat.): 3rd Member Testing Opportunity
  • April 23 (Sat.): 4th Member Testing Opportunity
  • May 7 (Sat.): 5th Member Testing Opportunity

During each Saturday test, the IEX Production system will available from 8:00 a.m. to 1:00 p.m. ET for testing functionality of Investors Exchange.

Test data is available nightly directly from the SIPs.

  • CTA: Test data is disseminated from CQS/CTS on business weekdays from 9:00 – 9:15 p.m. ET from the multicast Playback Test channels (not over Production channels).
  • UTP: A test file is recorded to be replayed in the evenings from 9:00 p.m. to 10:30 p.m. ET to all UTP data feed subscribers. Evening test data is provided over the production IP services during the designated times. No registration is required to participate in evening testing.

Who is eligible to participate in the scheduled Saturday tests?

  • Member, Service Bureau, Sponsored Participant, and Extranet Provider

    Those who wish to access IEX's system for order entry and execution must submit all required Connectivity Agreements and Forms and such forms must be approved by IEX on the Monday prior to a Saturday test to be eligible for participation. Additionally, new Members and Service Bureaus must complete a successful certification in IEX's Certification environment prior to participating in a Saturday test. The first page of the document provides a checklist of the agreements and forms required from each type of participant.

    Additionally, application and agreements for broker membership, service bureau access, or sponsored access must be submitted to IEX by the Monday prior to a Saturday test to be eligible for participation (IEX approval prior to testing is not required for these documents). The checklist on the first page of each document below outlines the required application, agreement, and forms for each participant:

  • Data Recipients

    Those who wish to access IEX's system for the receipt of IEX's data products (e.g. TOPS) must submit all required Data Agreements and Forms and such forms must be approved by IEX on the Monday prior to a Saturday test to be eligible for participation. The first page of the document provides a checklist of the agreements and forms required.

  • Newly Connecting Participants

    Those who require new physical connections to IEX, please plan accordingly to ensure the physical connectivity is ordered at least two (2) weeks in advance of the test you wish to participate in.

Who can submit orders on the IEX ATS or Investors Exchange during the transition period?

During the pre-launch period, all ATS Subscribers may submit orders to IEX. During the two-week phase-in period following Exchange launch, only market participants who are Members of Investors Exchange or technology partners who have been approved by IEX will be able to submit orders to either the ATS or the Exchange.

For additional information about the documentation required to participate on the Exchange, see iextrading.com/trading/membership.

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: iextrading.com.