No More Maker Taker??
BY DANIEL P. COLLINS
Published 10/1/2009??
In late August, the Boston Options Exchange (BOX) pulled the plug on its maker taker pricing on all Penny Pilot options classes a few weeks after bowing to convention ? albeit in a non-conventional way ? by creating a payment for order flow model in the form of a taker maker model. (In the maker taker model, an exchange will pay a credit to the provider of liquidity and charge the taker of liquidity.)
Maker taker, all the rage a few years ago, may have reached a plateau, according to Mark Long of the OptionsInsider. ?Maker taker was the way to go. People were saying this is what was going to take over. BOX never really gained traction with it,? Longo says. ?We have seen a lot of pushback on the maker taker model. A lot of order routing firms have decided to configure their order router so that maker taker exchanges get it last. Brokerage firms didn?t like taker fees. They were used to being paid, not paying [based on payment for order flow].?