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 Futures & Options Segment.
On this background, Trading Members are hereby informed that the Exchange is launching the 6th programme in the series viz. LEIPS – VI on August 1, 2012. The Programme focuses on Futures & Options Contracts on BSE-100 Index.
The programme incentivises both MMs and GMPs by payment of cash for their participation as per prescribed terms & conditions.
Active trading members of Futures and Options Segments of the Exchange who have already signed up in LEIPS-III and LEIPS-IV programme as GMPs shall be treated as GMPs in LEIPS-VI programme as well. Trading members who wish to opt out of the LEIPS-VI programme as GMPs shall be required to intimate the Exchange of the same.
Registered Market Makers of LEIPS- III & LEIPS- IV programme shall have to register themselves as a Market Maker in LEIPS- VI programme & expressly indicate their interest to do Market Making in the underlying Index eligible under LEIPS-VI programme.
Other active trading members of Futures and Options Segments of the Exchange can register themselves as a Market Maker (MM) or a General Market Participant (GMP) for this programme as well.
LEIPS-VI envisages the MMs to have a continuous quoting obligation with specified size and spread in Futures & 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 in Index Options.
· 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-VI 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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Rajesh Saraf
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Sameer Vaze
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GM – Trading Operations
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DM – Trading Operations
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