Texas Exchange Tunes Opening and Closing Auctions
Published Date: 7/7/2026
Notice
Summary
Texas Stock Exchange is updating how its opening and closing auctions work to make trading smoother and fairer for everyone using the exchange. These changes could affect traders and investors by improving price discovery and order handling, with a decision expected by July 28, 2026. No direct costs were mentioned, but the update aims to boost market efficiency and confidence.
Analyzed Economic Effects
5 provisions identified: 5 benefits, 0 costs, 0 mixed.
Late Orders Use Participation Bands
The Exchange will stop constraining Late Auction Orders by the NBBO and instead constrain them with security-specific "Participation Bands" calculated from recent TXSE trades and/or quotes. This changes how late limit orders (LLOO/LLOC, renamed LOO.L/LOC.L) are adjusted immediately prior to the Opening or Closing Auction.
Participation Band Formulas & Limits
The Participation Bands midpoint will be the median of recent eligible prices and the width = median absolute deviation × k. The filing sets permissible parameter ranges (e.g., Observation Window 2–30 minutes; Recalculation Interval 1–5 seconds; Trade Method k 1.0–10.0; Reference Price Width 0.50%–2.50% per side; Maximum Half-Width 1.0%–5.0% per side).
Earlier Cutoffs and No-Cancel Period
The Exchange shortens certain cutoffs so LOC and MOC orders may be submitted only until 3:58 p.m. (instead of 3:59 p.m.), LOC.L orders can be submitted starting at 3:58 p.m., and Eligible Auction Orders may not be modified or cancelled after 3:58 p.m. RHO orders cannot be modified between 9:28 a.m. and 9:30 a.m.
Auction Data Published During Final Minutes
The Exchange will disseminate Matched Shares and the Offset Side every five seconds between 8:00 a.m. and 9:28 a.m. for openings and between 3:00 p.m. and 3:58 p.m. for closings. Starting at 9:28 a.m. (opening) and 3:58 p.m. (closing), it will instead publish the Participation Bands plus Lower Band and Upper Band Auction Interest at least every five seconds.
New Auction Tie-Breaker Step Added
The Exchange adds a new tie-breaker when multiple prices maximize executed shares and have the same imbalance: the auction price will be the entered price at which shares would remain unexecuted. If more than one such price exists, the price closest to the Volume Based Tie Breaker is used.
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