Boston Options Exchange - BOX

AAA

DEFINITION of 'Boston Options Exchange - BOX'

An all-electronic equity derivatives exchange launched on February 6, 2004, as a joint effort by the Montreal Exchange, Boston Stock Exchange and Interactive Brokers Group to provide an alternative to existing options markets. Technical operations of the Boston Options Exchange (BOX) are handled by the Montreal Exchange.

INVESTOPEDIA EXPLAINS 'Boston Options Exchange - BOX'

The BOX was the first options exchange to offer price improvement to traders through a process called PIP, which stands for Price Improvement Period. Although all investors can be "PIPed," the investor must have a broker that is willing and able to offer a facilitation trade – a trade where the broker guarantees the first penny of price improvement. Because not all brokers offer this to their clients, some investors do not have access to the price improvement offered on the BOX.

RELATED TERMS
  1. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee ...
  2. Options Industry Council - OIC

    A cooperative formed in 1992 by U.S. options exchanges and Options ...
  3. Toronto Stock Exchange - TSX

    The largest stock exchange in Canada. The Toronto Stock Exchange ...
  4. Stock Option

    A privilege, sold by one party to another, that gives the buyer ...
  5. Montreal Exchange

    A Canadian derivatives exchange that facilitates the trading ...
  6. Price Improvement

    Attaining a higher bid price, if you are selling a stock, or ...
Related Articles
  1. Options & Futures

    An Alternative Covered Call Options Trading Strategy

    This different approach to the covered-call write offers less risk and greater potential profit.
  2. Options & Futures

    Options Trading Volume And Open Interest

    Learn how these two statistics can give you an edge in trading options.
  3. Options & Futures

    How can I find out which stocks also trade as options?

    The trading of options has become increasingly popular among retail investors as they become aware of the many different ways that options can be used to generate large profits. The interesting ...
  4. Options & Futures

    Synthetic Options Provide Real Advantages

    Participate in options trading trading that is simpler, less expensive and easier to manage.
  5. Retirement

    Electronic Trading Tutorial

    Learn about the systems that run the market. Topics include market makers, specialists, SuperDOT, ECNs, SOES, Level I, II, and III Access, and more.
  6. Options & Futures

    Option Volatility

    Knowing how the market works in relation to volatility can open a whole new world of opportunity.
  7. Options & Futures

    Options -- Accessing Stakes In Apple At Less Cost

    Finding Apple stock costly to trade? Here are multiple ways to trade it through low-cost Apple options.
  8. Options & Futures

    These Are The Top Brokerage Firms For Options Trading

    Trading options? Here is the list of the best brokerage firms for options trading, with features, functionality, and brokerage rates.
  9. Options & Futures

    What is a volatility smile?

    Discover what options traders mean when they refer to a "volatility smile," and learn why a volatility smile's existence perplexes many investors and analysts.
  10. Options & Futures

    Apple As An Example Of How a Protective Collar Works

    We define a protective collar, using Apple (AAPL) as an example. A protective collar is a combination of a covered call plus long put position.

You May Also Like

Hot Definitions
  1. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  2. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  3. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  4. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  5. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  6. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
Trading Center