Nature of the trading venue, in terms of:
types and regulatory status of the instruments traded on the venue such as whether the trading venue trades liquid instruments subject to mandatory trading;
the role of the trading venue in the financial system such as whether the financial instruments traded on it can be traded elsewhere.
Scale, in terms of potential impact of the trading venue on the fair and orderly functioning of the markets based on at least the following elements:
the number of algorithms operating on the venue;
the messaging volume capacities of the venue;
the volume of trading executed on the venue;
the percentage of algorithmic trading over the total trading activity and the total turnover traded on the venue;
the percentage of high-frequency trading (HFT) activity over the total trading activity and the total amount traded on the venue;
the number of its members and participants;
the number of its members providing DEA including, where applicable, the specific number of its members providing for sponsored access and the conditions under which DEA is offered or can be delegated;
the ratio of unexecuted orders to transactions as observed and determined pursuant to Commission Delegated Regulation (EU) 2017/566;
the number and percentage of remote members;
the number of co-location or proximity hosting sites provided;
the number of countries and regions in which the trading venue is undertaking business activity;
the operating conditions for mechanisms to manage volatility and whether dynamic or static trading limits are used to trigger trading halts or rejection of orders.
Complexity, in terms of:
the classes of financial instruments traded on the trading venue;
the trading models available in the trading venue including the different trading models operating at the same time such as auction, continuous auction and hybrid systems;
the use of pre-trade transparency waivers in combination with the trading models operated;
the diversity of trading systems employed by the venue and the extent of the control by the trading venue over setting, adjusting, testing, and reviewing its trading systems;
the structure of the trading venue in terms of ownership and governance and its organisational, operational, technical, physical, and geographical set-up;
the various locations of the connectivity and technology of the trading venue;
the diversity of the physical trading infrastructure of the trading venue;
the level of outsourcing of the trading venue and in particular where any operational functions have been outsourced;
the frequency of changes to trading models, IT systems and membership of the trading venue.
Status: Please note you should read all Brexit changes to the FCA Handbook and BTS alongside the main FCA transitional directions. Where these directions apply the 'standstill', firms have the choice between complying with the pre-IP completion day rules, or the post-IP completion day rules. To see a full list of Handbook modules affected, please see Annex B to the main FCA transitional directions.
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