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Tuesday, July 21, 2009

Options Trader Alert #2009 - 38
Interface Testing for Compliance with the Options Symbology Initiative

Markets Impacted:


Contact Information:

What you need to know:

  • All firms must be in compliance with the Options Symbology Initiative (OSI) no later than February 12, 2010.
  • To ensure compliance readiness, firm testing of trading platform interfaces is mandatory.
  • Testing is available 9:00 a.m. to 5:00 p.m., ET, Monday through Friday beginning Monday, August 3, 2009, and firms must pre-register.
  • Upon completion of testing, firms may upgrade their production interfaces to the OSI-compliant versions.

What is the Options Symbology Initiative?

The Options Symbology Initiative (OSI) is intended to replace use of multiple root symbols and Options Price Reporting Authority (OPRA) codes to identify option series with explicit series elements:

  1. Security Symbol
  2. Expiration Year, Month and Day
  3. Strike Value
  4. Call or Put

The security symbol becomes in most cases the same as the issue symbol (stock symbol, primary index or World Currency Option symbol), with variation for situations such as corporate actions or other circumstances requiring a non-standard security symbol.

The initiative is accomplished in two main phases:

  • Conversion – Conversion from dependence on OPRA codes to use of explicit series elements.
  • Consolidation – Consolidating of all roots into the issue symbol.

For complete details of the OSI plan, industry testing dates and implementation dates, refer to the Options Clearing Corporation (OCC) website.

What interfaces are affected?

All five NASDAQ OMX PHLX XL II (XL II) trading platform interfaces are affected by the OSI initiative:

  • Firm FIX Engine (FFE)
  • Specialized Quote Feed (SQF)
  • Specialized Order Feed (SOF)
  • Risk Management Feed (RMP)
  • Top Of PHLX Options (TOPO)

Is testing required?

Testing is mandatory. The nature of the OSI initiative does not allow the continued use of OPRA codes after February 12, 2010, nor will firms be able to use the existing one-to-three character root symbols of a given issue once that issue undergoes consolidation. Failure to be ready for these dates will leave a firm unable to input orders or quotes or generally to trade options as of these dates.

When is testing available?

Testing is available 9:00 a.m. to 5:00 p.m., ET, Monday through Friday beginning Monday, August 3, 2009.

How can I register for testing?

Firms must register for testing in advance by contacting:

Jill Smith
PHLX Subscriber Services
+1 215 496 5473

A testing packet will be provided on initial contact that includes pertinent testing procedures and information as well as a set of recommended test cases. Test cases were chosen to cover the conversion phase as well as the consolidation phase.

Where can I find more information?

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