Wall Street-backed MEMX to launch options exchange

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FILE PHOTO: A street sign is seen in front of the New York Stock Exchange on Wall Street in New York

By John McCrank

NEW YORK – Members Exchange (MEMX), the fastest growing U.S. stock exchange, said on Tuesday it plans to launch an options exchange in the fourth quarter, pending regulatory approval, that will seek to reduce industry costs.

MEMX, which counts some of Wall Streets biggest firms among its investors, including BlackRock Inc, Goldman Sachs Group Inc and JPMorgan Chase, launched its stock exchange in September 2020, to address an intense debate over fees between large exchange operators and their customers.

Taking an aggressive approach to pricing, MEMX has gained more than 4% market share, surpassing the volume of some exchanges run by Intercontinental Exchange Inc’s New York Stock Exchange, Nasdaq Inc, and Cboe Global Markets.

“MEMX Options will use technological advancements to increase determinism, reduce costs and drive competitive improvements for our options members, just as we did in equities,” said MEMX Chief Executive Officer Jonathan Kellner.

The market operator worked with its members on establishing how to add value to the options space, Kellner said.

Other MEMX investors include BofA Securities, Charles Schwab Corp, Citadel Securities, Fidelity Investments, Morgan Stanley, UBS, and Virtu Financial.

The Jersey City, New Jersey-based exchange was founded after years of complaints by brokers and other market participants over what they saw as unjustifiably high fees charged by most exchanges for things like market data and exchange connectivity.

MEMX began charging for market data in February at a significantly lower price than the large incumbent exchanges.

“As we progress, we look forward to lending our voice to help advance key issues in the U.S. equity options markets,” Kellner said.

(Reporting by John McCrank; Editing by Chizu Nomiyama)

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