Market Access2017-05-30T19:38:37+00:00

Market Access

SpiderRock Platform (our technology company) facilitates market access via multiple executing brokers including SpiderRock EXS (our sister company). SpiderRock consults with clients to determine their best available market access options and can structure client-specific market access routes to optimize latency, minimize cost, preserve existing relationships, provide redundancy or enhance available child order bandwidth.

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Frequently Asked Questions

What is my relationship with SpiderRock Platform?

SpiderRock Platform is a technology provider and not a registered broker dealer. Some clients execute contracts directly with SpiderRock Platform independently of their relationship with their prime brokers or third party executing brokers that provide market access. Other clients access the SpiderRock Platform technology by contracting with SpiderRock EXS, an affiliated registered broker dealer, that can facilitate market access.

What is the role of my executing broker?

An executing broker has regulatory oversight responsibilities for client trading activities. This may include provision of market access routes and risk controls, retention of all trading records, regulatory reporting and surveillance obligations, as well as exchange rule compliance. An executing broker also has an obligation to know its customers and to perform certain background checks prior to enabling market access.

Can I have more than one executing broker?

Yes. A client may have separate executing brokers for a variety of reasons, including optimization of market access latency, optimization of brokerage fees and services, and maintenance of market access redundancy.

How does SpiderRock Platform get paid?

Direct SpiderRock Platform clients are invoiced monthly per the terms of their licensing agreement. Clients of SpiderRock EXS typically pay a per share / per contract commission and SpiderRock Platform invoices SpiderRock EXS under the terms of a services agreement between the two companies. In some cases, clients that utilize a third party executing broker pay a commission to their executing broker that is split between that broker and SpiderRock EXS. In other cases, SpiderRock EXS invoices the client for a routing fee and their executing broker independently collects a commission.

Can my executing broker be my clearing broker?

Yes. In most cases, clients can use their clearing broker as their executing broker. However, this is generally not a requirement. In most cases, clients can utilize an executing broker that is independent of their clearing broker and direct that executing broker to deliver their trades to their clearing broker either as they occur in the markets or at the end of the trading day.

What are the advantages of using an independent executing broker?

Specialized independent executing brokers can provide higher capacity and lower latency market access routes than those available from most clearing firms. In situations where capacity or latency are important, there can be a resulting improvement in market execution performance.

What are the disadvantages of using an independent executing broker?

In some situations, it is not possible for a client to use an independent executing broker due to market structure or other contractual obligations with their clearing broker. In other situations, the extra cost of using an independent executing broker exceeds the associated market execution advantages and would not be a recommended configuration.

Frequently Asked Questions

What is my relationship with SpiderRock Platform?

SpiderRock Platform is a technology provider and is not registered as a broker dealer. Some clients execute contracts directly with SpiderRock Platform and independently contract with an executing broker that acts as their market access provider. Other clients access SpiderRock Platform technology and services by contracting with SpiderRock EXS, a SpiderRock Platform sister company and registered broker dealer.

Who is my executing broker?

For some clients, SpiderRock EXS acts as their executing broker. For direct SpiderRock Platform clients, either their clearing firm or a third party firm acts as their executing broker dealer.

What is the role of my executing broker?

An executing broker has regulatory oversight responsibilities for client trading activities. This may include provision of market access routes and risk controls, retention of all trading records, regulatory reporting and surveillance obligations, as well as exchange rule compliance. An executing broker also has an obligation to know its customers and to perform certain background checks prior to enabling market access.

Can I have more than one executing broker?

Yes. A client may have separate executing brokers for a variety of reasons, including optimization of market access latency, optimization of brokerage fees and services, and maintenance of market access redundancy.

How does SpiderRock Platform get paid?

Direct SpiderRock Platform clients are invoiced monthly per the terms of their licensing agreement. Clients of SpiderRock EXS typically pay a per share / per contract commission and SpiderRock Platform invoices SpiderRock EXS under the terms of a services agreement between the two companies. In some cases, clients that utilize a third party executing broker pay a commission to their executing broker that is split between that broker and SpiderRock EXS. In other cases, SpiderRock EXS invoices the client for a routing fee and their executing broker independently collects a commission.

Can my executing broker be my clearing broker?

Yes. In most cases, clients can use their clearing broker as their executing broker. However, this is generally not a requirement. In most cases, clients can utilize an executing broker that is independent of their clearing broker and direct that executing broker to deliver their trades to their clearing broker either as they occur in the markets or at the end of the trading day.

What are the advantages of using an independent executing broker?

Specialized independent executing brokers can provide higher capacity and lower latency market access routes than those available from most clearing firms. In situations where capacity or latency are important, there can be a resulting improvement in market execution performance.

What are the disadvantages of using an independent executing broker?

In some situations, it is not possible for a client to use an independent executing broker due to market structure or other contractual obligations with their clearing broker. In other situations, the extra cost of using an independent executing broker exceeds the associated market execution advantages and would not be a recommended configuration.

Can I pass SpiderRock Platform fees through to my clients as brokerage charges?

In most cases, firms can pass commissions paid to either SpiderRock EXS or an independent executing broker through to their clients. Frequently, SpiderRock EXS routing fees can also be passed through provided sufficient disclosures have been made. Fees paid directly to SpiderRock Platform are generally not considered commissions and would not be eligible for treatment as such; however, SpiderRock platform fees can qualify as soft-dollar eligible expenses under certain conditions.

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