Nasdaq PHLX files pricing rule changes for options rebates and fees

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Nasdaq PHLX options pricing changes

Highlights

Nasdaq PHLX filed a rule change with the SEC on June 9 to amend Options 7, Sections 2, 5, and 9B for immediate effectiveness.
Phlx proposes lowering volume thresholds for Tier 4 and Tier 5 rebates in its Customer Rebate Program, aiming to attract increased order flow excluding monthly SPY options.
The exchange seeks to update surcharges on Nasdaq-100 Index (NDX and NDXP) options and remove obsolete port fee language, citing alignment with market risk and competitive positioning.

Proposed pricing revisions and filing scope

As reported by the Securities and Exchange Commission, the notice published June 9 states that Nasdaq PHLX filed the proposal for immediate effectiveness under Section 19(b)(1) of the Securities Exchange Act and Rule 19b-4. The filing covers amendments to Options 7, Sections 2, 5 and 9B of the exchange's pricing schedule.

The exchange says it wants to revise the Customer Rebate Program by lowering certain percentage thresholds of national customer volume in multiply listed equity and ETF options classes, excluding monthly SPY options, for Tier 4 and Tier 5 rebates. Phlx says the change is intended to encourage members and member organizations to route more order flow to the market so they can qualify for additional rebates.

The proposal also updates the surcharge applied to Nasdaq-100 Index options, or NDX, and P.M.-settled NDXP options. In addition, the exchange seeks to remove text in the port fee section tied to a migration.

Market risk rationale and industry impact

Phlx argues that the revised surcharge structure better reflects differences in the economic characteristics of underlying transactions, particularly where greater effective leverage justifies higher fees. The exchange says leverage gives traders exposure to a large notional amount of the underlying index for a relatively small upfront payment, but that the significance of that leverage changes materially with premium prices.

The filing says the pricing approach is designed to stay aligned with prevailing market risk without constant manual recalibration. Phlx adds that the Nasdaq-100 is especially exposed to such swings because of its heavy concentration in large capitalization technology companies, whose sharp price moves can quickly lift option premiums.

The exchange says the overall package is meant to enhance its competitiveness against other venues while avoiding any unnecessary burden on competition. The SEC notice is soliciting comments from interested parties on the proposed rule change.

Our earlier analysis of the Nasdaq-100 (NDX) highlighted the index slipping below its 20-day moving average while staying above longer-term trend levels, pointing to short-term weakness inside a broader bullish structure. We also flagged elevated volatility and key pivot areas—especially around the 29,133 support zone—with experts split between the risk of a deeper pullback and the potential for a rebound if support holds.

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