JSE scraps fees on some products

Johannesburg - The JSE has eliminated fees on some futures and options trades to boost liquidity and attract more algorithmic traders.

The JSE Ltd [JSE:JSE], which operates Africa's biggest bourse, has been pushing to raise its profile as the fast-growing continent increasingly seen as an investment destination.

Algorithmic trading - where traders use ultra-quick computer calculations to take advantage of tiny imbalances - is a mainstay of US and European markets. In Africa, however, it is not yet as prominent.

The new billing system went into effect this week and will bring the JSE in line with a model used by derivatives exchanges globally, the exchange said in a statement on Tuesday.

"This is likely to encourage greater activity and transparency on the market," it said.

The JSE said it would not charge price makers for trading single stock futures and options through its central order book.

For price takers, the fee will be reduced to 1 basis point of the value of the underlying instrument, it said.

It also cut the maximum transaction cost on its central order book to R1.20 per contract, from R1.40.

Fees on index futures will be increased, the JSE said.

The exchange is waiting for regulatory approval for Africa's first dark pool. Dark pools are trading venues that allow buyers and sellers of large stock orders to avoid revealing pre-trading information to the rest of the market.

- Reuters