Pursuant to SEBI Circular CIR/DNPD/5/2011 dated June 02, 2011 (BSE Notice no-20110602-18, dated June 02, 2011), permitting stock exchanges to introduce Liquidity Enhancement Schemes (LES) for illiquid securities in their equity derivatives segment, the Exchange has launched a series of Liquidity Enhancement Incentive Programmes (LEIPS) with the goal of creating lasting, self-sustaining liquidity in BSE's Derivative Segment.
On this background, Trading Members are hereby informed that the Exchange is launching the 11th programme in the series viz. LEIPS – XI on April 26, 2013. The Programme focuses on Options Contracts on S&P BSE-100 Index.
The programme incentivizes both Market Makers (MMs) and General Market Participants (GMPs) by payment of cash for their participation as per prescribed terms and conditions.
Active trading members of Derivatives Segment of the Exchange who have already signed up for in LEIPS-VII, LEIPS-VIII and LEIPS-IX programme as GMPs shall be treated as GMPs in LEIPS-XI programme as well. Trading members who wish to opt out of the LEIPS-XI programme as GMPs shall be required to intimate the Exchange of the same.
Registered Market Makers of LEIPS-VII, LEIPS-VIII and LEIPS-IX programme shall have to register themselves as a Market Maker in LEIPS–XI programme & expressly indicate their interest to do Market Making in the options contracts on underlying index eligible under LEIPS-XI programme.
Other active trading members of Derivatives Segment of the Exchange can register themselves as a Market Maker (MM) or a General Market Participant (GMP) for this programme as well.
LEIPS-XI envisages the MMs to have a continuous quoting obligation with specified size and spread in Options Contracts on BSE-100 Index. The programme offers 4 types of incentives to market participants –
· Trading volume based daily cash incentives to MMs & GMPs.
· Quote based incentives for MMs.
· Open Interest (OI) based cash incentives paid on daily basis for average daily OI to MMs and GMPs
· Lower transaction fees for all active trading members.
Details of LEIPS-XI programme are enclosed herewith as Annexure.
For any further clarifications, please contact your designated Relationship Managers.
For and on behalf of BSE Limited.
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Devika Shah
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Sameer Vaze
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Sr.GM – Trading Operations
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Manager – Trading Operations
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