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BATS Chris Concannon

BATS ETF Marketplace introduces incentives for issuers, market makers and investors


BATS Global Markets (BATS) is introducing incentive schemes for exchange traded fund issuers and market makers with the launch of the BATS ETF Marketplace.

“As the largest market for exchange-traded funds, BATS is uniquely positioned to change the game for issuers, investors and market makers,” says BATS Global Markets CEO Chris Concannon (pictured).
The BATS Issuer Incentive program is an innovative and unique payment program that allows an issuer to benefit from listing on BATS by providing an annual payment for each product listed on BATS with Consolidated Average Daily Volume (CADV) greater than 1 million shares per day.
Traditionally, ETP issuers have paid between USD5,000 and USD55,000 on an annual basis in order to be listed on a US stock exchange. BATS recently implemented a free ETP listing offering, and now the firm is redefining the listing relationship for issuers by paying them for their listings. As trading volume increases for an ETP, so does the payment earned by the issuer.
“At BATS, we believe it is important for an exchange to align its interests with the interests of its issuers and their investors. Our Issuer Incentive Program accomplishes that by allowing issuers to share in the revenues from the trading of their products,” says Laura Morrison, Senior Vice President, Global Head of Exchange Traded Products at BATS. “Our Issuer Incentive program creates an opportunity for ETP issuers to offset expenses with revenue from activity in their products while trading on one of the most liquid markets for ETPs.”
The BATS Lead Market Maker (LMM) program is a rewards-based program that incentivises Market Makers for their participation in BATS-listed ETPs. First, LMMs receive larger incentives for providing liquidity and reduced costs for removing liquidity in their assigned ETPs. Secondly, BATS LMMs receive additional economic incentives for making markets in additional ETP products listed on BATS.
Morrison adds: “Our new Lead Market Maker incentives are designed to further enhance the market quality of all ETPs listed on BATS, regardless of size or liquidity. Traditional market maker programs target individual symbols while our innovative market maker incentives are designed to encourage liquidity and support across an entire portfolio of ETP products.”

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