Block Trade Facility (BTF)

 

Effective immediately, ASX has updated the Procedures to: Remove 7 leg or more option orders from the User Defined Combination Strategies (UDC) rules and procedures, including pre-negotiation rules, and include these orders as 1 lot/leg block trade orders applicable to all products.

For the night session only block trades the Exchange will publish block trade information by no later than 12pm on the day of registration. For night session only block trades, trading is restricted to during the night trading session hours, that is, 5. For example when executing a block trade, this requires a minimum of 25 lots for each quarter, not an aggregate across a strip. Block trades may be executed at any time at a fair and reasonable price and are required to be reported to the CME Group Globex Control Center "GCC" within five minutes of the execution time, except for Eurodollar , Housing and Weather futures and options which are subject to a minute reporting requirement.

What do I need to do by when?

31 rows · Block Trades may therefore legitimately occur at prices different to the prevailing price of a contract in ASX Trade24 at the time. Execution certainty - block trades will be approved by the Exchange as long as they occur in prescribed contracts and do not contravene the business rules of the BTF.

Can orders less than the minimum threshold for a contract be aggregated to form a block t rade? Participants may not aggregate separate orders to meet minimum threshold requirements. However, participants may aggregate any orders individually greater than or equal to the minimum threshold for that contract. For example, if the minimum threshold is lots, a buy order for 1, lots may be satisfied on the sell side by four lot orders.

Do the counterparties to the block trade have freedom to determine the price of the transaction? There are no explicit price limits attached to block trades. Block trades may legitimately occur at prices different to the ASX Trade24 market price for the relevant contract at the time of trade agreement. However, ASX reserves the right to not approve a proposed block trade if the proposed price of the block trade varies significantly, as assessed by the Exchange, from the price at which trades are being transacted on ASX Trade24 at the time that the record details are lodged.

A block trade is executed as a participant to participant transaction or a cross transaction for a single participant on behalf of a client submitted to ASX via ASX TradeAccept. With the exception of the night session block trades, participants to the trade have 10 minutes to submit the block trade report via ASX TradeAccept. Participants should not submit the proposed block trade to the Exchange for validation until all details of the trade have been agreed. As an example, market-on-close orders cannot be submitted until the close of the market because of the dependence on the closing price.

The difference between the time of trade agreement from ASX Trade24 message and the time of receipt by ASX from trade registration form. After the trade is agreed between participants, how long does ASX require to process and publish the transaction? Subject to validation, ASX will disseminate block trade information from 9: Validated block trades will be published to the market via the ASX Trade24 message facility.

For the night session only block trades the Exchange will publish block trade information by no later than 12pm on the day of registration. In addition, please see the Energy Market Policy for further details. The Block Trade Facility BTF is an off-market trading facility, that enables market participants or ASX 24 Participants on behalf of their clients to bilaterally arrange transactions e.

Appropriately licensed wholesale market participants can directly negotiate Block Trades, however the orders must be registered through an ASX Clear Futures Participant. Block Trades can be executed at any time. For Block Trades agreed within the normal Trading Day they must be registered within 10 minutes.

For Block Trades agreed after hours they must be registered the next business day between 9: Block Trades cannot be registered during the pre-open period i. The BTF may only be used to arrange and execute trades equal to and above pre-defined volume thresholds.

For example when executing a block trade, this requires a minimum of 25 lots for each quarter, not an aggregate across a strip. Block Trade Facility - Summary Information. Many exchanges have a block trading facility that allows members to transact business of significant size as a bilaterally agreed transaction and then bring it to an exchange.

In the futures industry, once a block trade has been established, the parties to the trade can use the futures market to hedge their position and then to unwind it, thus bringing more trading volume to the exchange.

Some exchanges require that the block trade be reported in 15 minutes or less, but reporting time differs between exchanges. It can vary with the size of the respective block trade. The larger the size of the block trade, the more time the parties need to hedge or offset their risks, and the more time they need to report it. Block trades are permitted in specified products and are subject to minimum transaction size requirements which vary according to the product, the type of transaction and the time of execution.