Retail Flag Trading Functionality

Retail Flag Innovation for Best Execution

With the introduction of retail flag functionality, orders marked as retail benefit from the best execution pricing and improved spreads. Recognizing the pivotal role of retail participation in driving market liquidity and innovation, MEFF is a strong advocate for regulatory reforms to support retail traders. We are committed to fostering a collaborative environment that enhances market competitiveness and positions Euro- pean derivatives trading for sustained growth. The launch of the unique retail flag trading functionality in December 2023 has enhanced investments in Spanish derivatives. This new feature brings price improvements, empowers retail investors and fosters innovative trading solutions.

Benefits

Innovation: Enhances pricing, encourages retail participation, and embraces technological advancements.
No obligation: This service is voluntary.
Advocacy for regulatory reforms: Fosters market competitiveness and innovation, including retail-focused enhancements aiming to streamline the trading processes.
Liquidity: Committed to enhancing market liquidity and positioning European derivatives trading for growth.
Education: Enhances the knowledge of retail investors, emphasizes investor protection, and promotes derivatives as a future-proof investment alternative. Collaboration with retail brokers and Instituto BME / Braindex.
Price improvements: Market Makers believe that the use of the Retail Flag could lead to more attractive pricing and greater satisfaction for retail clients by making it easier to offer more competitive conditions to counterparts other than Market Makers or High-Frequency Traders.

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Diverse Market Participants, One Solution

MEFF serves a variety of important stakeholders, including traders and retail brokers, professional and retail investors, and regulatory bodies such as the Spanish CNMV and the EU ESMA. For traders and retail brokers, MEFF enhances the trading process, and for professional and retail investors, it provides valuable educational resources.

MEFF has a total of 50 members, with 17 being Spanish and the remaining international members constituting approximately 70% of the total participation. Among these members, five are primarily focused on serving retail clients.

MEFF introduces Retail Flag for retail clients

GVC GAESCO VALORES, S.V., S.A. and RENTA 4 BANCO, S.A. are the first MEFF Members to offer the Retail Flag for their retail clients, as this functionality allows an order to be marked as belonging to a retail client.

Market Makers believe that the use of the Retail Flag may result in better prices and greater satisfaction for retail clients, as it enables them to offer more competitive prices to counterparties that are neither Market Makers nor High-Frequency Traders.