Possible mistake in BOX option fee in IB's website

Discussion in 'Options' started by hajimow, Aug 13, 2011.

  1. All exchanges usually rebate you if you add liquidity and charge you more fee if you remove liquidity or at most both cases are the same. I noticed that BOX is doing reverse which I believe it is a typo. I have attached this from IB's option commission website.
  2. rmorse

    rmorse Sponsor

    Not a typo. http://www.bostonoptions.com/pdf/BOX_Fee_Schedule.pdf

    look at page 6....
  3. rmorse

    rmorse Sponsor

    They are trying to attract depth and liquidity. Other exchanges do that by offering member the opportunity to make two sided markets. Market makers pay for order flow on many exchanges for the right to buy on the bid and sell on the offer (ISE, CBOE, AMEX, PHLX). On the BOX, they charge you a fee like they do the market makers on those other exchanges . You pay a fee to be able to be on the markets. To get traders to trade with those markets, they offer a credit.

    You get the same benefit that marker makers get without the time and expense of being a broker dealer. And, you get to choose on every order how you want to execute it that works best for you.
  4. Thanks rmorse for the explanation.