Optiver to Halt Trading in Australian Options Markets

Australia’s main financial trading venue, the Australian Securities Exchange (ASX), will lose a major Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term provider in its Options product range. As reported by Australian media, Optiver will cease trading on the ASX. The move is expected to impact the exchange’s derivatives offering.

The Dutch origin financial trading firm reported that it will halt its market-making offering on the exchange, the news was confirmed by a representative of the firm. Optiver has been a major contributor to ASX’s Exchange Traded Options (ETO) product range.

The news comes as a surprise to participants in the Australian financial landscape as Optiver had recently reported (on its website) that it was touring Australian and New Zealand-based education institutes sourcing new talent.

ETOs have seen a sharp decline in trading activity in Australia, ASX reported a 20% drop in volumes over the last twelve months in its annual report presentation. Global markets have been scarred by problems with the Russia-Ukraine conflict, coupled with the ongoing crisis in the Middle East.

Financial markets have seen record low Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders Read this Term as traders stay cautious of uncertain trading conditions, the reduced volatility has impacted Australia's Options volumes.

Optiver has been a vocal player in the Australian derivatives space, the firm regularly responds to consultation's issued by the state regulator in reference to ETOs. Optiver responded to an ASX respectively in May, earlier this year.

The firm commented and expressed its view on the exercise of cash-settled options. In the letter, the firm's Senior Compliance Officer stated: “Automatic exercise of cash-settled options is the most efficient outcome for the market. It reduces risks associated with errors in exercise, and aligns with all international standards. The certainty of automatic exercise as the default position may provide increased confidence to market participants.”

Optiver follows Dutch rival, IMC Markets, which departed from the Australian markets in 2013.