Sponsored Access Agreement

Members of Turkise who wish to offer sponsored access to their customers as a sponsorship company must sign a sponsored access contract with Turquoise. Sponsored Access is offered via the standard Native Turquoise protocol, which is the fastest way to access integrated and dark order books, and Turquoise Block Discovery™. Sponsored access has many different meanings for market participants and is often misunderstood. Its origin can be attributed to the practice of direct market access (DMA) in which a broker member of a stock exchange provides its incoming identification (MPID) and exchanges the connectivity infrastructure to a customer interested in the customer sent directly to the exchange. [5] Sponsored Access allows turquoise participants to directly access trade for non-participants through membership, through risk control mechanisms. In a December 2009 sponsored access report, Aite Group defined this in such a way that a non-member organization (i.e. a sponsored participant) could directly access the market centres using a member broker/distributor`s MPID and using the access infrastructure that is not owned by the sponsoring broker. Sponsored Access refers to the practice in which a bank or brokerage company provides a client with direct market access to the stock market without any risk management prior to trading. [1] Sponsored access allows high-frequency traders to access low-latency markets with advances provided by the stock exchange. [2] [3] [4] Companies may opt for a sponsored access agreement for many reasons, including reduced latency, additional revenue opportunities and discounts on quantities.

[6] Sponsored Access is a service based on a series of pre-negotiation validation tests performed on all commands (including bulk ads) made by a sponsored user. This helps sponsorship companies in risk management and allows sponsored users to directly access turquoise liquidity, including Turquoise Block Discovery™. The sponsored user is not required to sign a member contract with Turquoise. However, the sponsorship company is required to perform due diligence on all sponsored users and must prove it turquoise before having sponsored access. All orders entered by the sponsored user are registered in the name of the sponsorship company, and the sponsorship company is responsible for all business activities that are carried out on its behalf. HMRC has confirmed that the reserve stamp tax (SDRT) will not apply to turquoise for its sponsored access service. A drop copy of the entire conversation is provided to each sponsored participant via FIX. A sponsored graphical interface allows the sponsor to monitor the gross exposure of each sponsored participant, adjust the maximum gross exposure and suspend the rest of the trade by a sponsored participant.

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