Cboe C2 Unveils 'Step Up' Trading Gimmick for Faster Deals
Published Date: 9/2/2026
Notice
Summary
Cboe C2 Exchange is rolling out a new Step Up Mechanism (SUM) to make trading smoother and faster for certain orders. This change affects traders using the Exchange by automating how some orders get handled, aiming to boost efficiency without extra costs. The new rule kicks in right away, so everyone can start benefiting from SUM immediately!
Analyzed Economic Effects
4 provisions identified: 2 benefits, 0 costs, 2 mixed.
New Step Up Mechanism (SUM) Adopted
The Exchange adopted a new Step Up Mechanism (SUM) that automatically exposes qualifying orders at the national best bid or offer (NBBO) so other Users can ‘‘step up’’ to match or improve the NBBO and trade on the Exchange. SUM applies only to eligible order sizes, types, Capacities, and classes (as the Exchange determines) and lets a User opt out on an order-by-order or port-level basis.
Operative Immediately Upon Filing
The Commission waived the normal 30-day delay and made the SUM rule operative upon filing on August 27, 2026, so market participants on the Exchange can begin using SUM immediately. The Exchange requested this waiver to match other exchanges that already offer similar functionality.
Short Exposure Window Rules (≤1s, 10ms Intended)
When SUM is triggered, the Exchange exposes the order at the NBBO for an exchange-determined period not to exceed one second (the Exchange intends to set the exposure period to 10 milliseconds when it activates SUM). During that exposure period, Users may submit responses limited to the exposed order size, and at the end the Exchange evaluates responses and the ABBO and executes or routes remaining size.
SUM Included in Message Processing and Risk Counting
The Exchange amended rules so SUM exposure periods receive the same inbound message processing treatment as other auctions (e.g., COA) and added SUM executions to the Risk Monitor Mechanism so a Trading Permit Holder (TPH) may choose whether SUM volume/executions count toward its limits. This lets TPHs manage exposure from SUM executions like other auction activity.
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