12. Are message and execution thresholds typically set by contract, or by algorithm? What are the advantages and disadvantages to each method?
13. Who should be charged with setting message rates for products and when they are activated?
14. Would message and execution throttles provide additional protection in mitigating credit risk to DCOs?
Volatility Awareness Alerts
15. The Commission is aware that alarms can be disruptive or counterproductive if "false alarms" outnumber accurate ones. How can volatility alarms be calibrated in order to minimize the risk that false alarms could interrupt trading or cause human monitors to ignore them over time?
16. What specific practices or tools have been effective in blocking self-trades, and what are the costs associated with wide-spread adoption of such practices or tools?
17. Please indicate how widely you believe exchange-sponsored self-trading controls are being used in the market.
18. Should self-trade controls cancel the resting order(s)? Or, instead, should they reject the taking order that would have resulted in a self-trade? If applicable, please explain why one mechanism is more effective than the other.
19. Should exchanges be required to implement self-trading controls in their matching engines? What benefits or challenges would result from such a requirement?
20. Please explain whether regulatory standards regarding the use of self-trading control technology would provide additional protection to markets and market participants.
21. If you believe that self-trading controls are beneficial, please describe the level of granularity at which such controls should operate (e.g., should the controls limit self-trading at the executing firm level? At the individual trader level?) What levels of granularity are practical or achievable?
22. If you believe that self-trading controls are beneficial, please explain whether exchanges should require such controls for market participants and identify the categories of participants that should be subject to such controls. For example, should exchanges require self-trading controls for all participants, some types of participants, participants trading in certain contracts, or participants in market maker and/or incentive programs? What benefits or challenges would result from imposing such controls on each category of participant?
23. The Commission is aware that some exchanges already have price collars in place for at least a portion of the contracts traded in their markets. Please comment on whether exchanges should utilize price collars on all contracts they list.
24. Would price collars provide additional protection in mitigating credit risk to DCOs?
Maximum Order Sizes
25. Are such controls typically applied to all contracts and customers, or on a more limited basis?
26. Do exchanges allow clearing members to use the exchange's technology to set maximum order sizes for specific customers or accounts?
27. Would additional standardization in the capabilities of this technology or more uniform application of this technology to all customers and contracts improve the effectiveness of such controls?
28. To what extent are clearing firms and trading firms conducting pre-trade maximum order size screens? Please explain whether firms are conducting such screens by utilizing: (1) Their own technology; (2) the exchange's technology, or (3) a combination of both.
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