BOX Exchange Opens Electronic Auctions for Custom Stock Options
Published Date: 11/9/2026
Notice
Summary
BOX Exchange is rolling out new rules to let investors trade FLEX Equity Options through electronic auctions, making these custom options easier and faster to buy and sell. This change affects traders who want more control over their option contracts and kicks in right away with no extra fees. It’s a smart move to boost flexibility and speed in the options market starting now!
Analyzed Economic Effects
6 provisions identified: 3 benefits, 2 costs, 1 mixed.
FLEX Solicitation Auction Minimum Size and Rules
BOX will offer a FLEX Solicitation Auction under Rule 7275 that requires Agency Orders and Solicited Orders to meet a minimum size designated by the Exchange (which may not be less than 500 contracts). Each Agency and Solicited Order is handled all-or-none, prices must be in $0.01 increments, and auctions may only be submitted after the underlying market opens.
FLEX Options Now Trade Electronically on BOX
You can now trade FLEX Equity Options on the BOX electronic market via new rules (7155 and 7275). Previously, FLEX trading on BOX was limited to FLEX Open Outcry (FOO) on the trading floor (Rule 7605(b)); the filing to adopt electronic FLEX auctions was submitted October 21, 2026 and is described as immediately effective.
New FLEX PIP Auction Rules
BOX will offer a FLEX Price Improvement Period (FLEX PIP) auction governed by Rule 7155. FLEX PIP orders have no minimum size, must use minimum price increments of $0.01, and an auction duration may be set between 3 seconds and 5 minutes (default 3 seconds). FLEX PIP responses are not disseminated to OPRA and are not visible; the initiating participant may improve (but not cancel) its Primary Improvement Order price after submission.
Electronic FLEX Complex and Multi-Leg Order Definitions
BOX will add defined terms allowing electronic FLEX Complex Orders and FLEX Multi-Leg Orders (proposed Rules 7240(a)(11) and (12)): each leg must be a FLEX Equity Option series authorized for FLEX trading on the same underlying security and each leg must have the same exercise style (American or European).
Order Flow Providers Must Have Letters of Authorization
BOX will amend Rule 5055(l) so that a Letter of Authorization from a clearing member organization must be filed with the Exchange for Order Flow Providers as well as Floor Brokers before they effect any FLEX Equity Option transactions.
Fungibility and Closing Rules When Non-FLEX Series Appear
BOX proposes new Rule 5055(f) provisions addressing fungibility: if a Non-FLEX Equity Option series is added intra-day for a component leg of a FLEX Complex or Multi-Leg Order, a holder/writer may close its FLEX position against another closing-only FLEX position for the rest of that trading day. If a Non-FLEX series is added on a trading day after the FLEX position is established, the holder/writer must execute separate FLEX and Non-FLEX transactions to close positions.
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