Options Price Reporting Authority
|Options Price Reporting Authority|
The Options Price Reporting Authority (OPRA) provides, through market data vendors, last sale information and current options quotations from a committee of Participant Exchanges designated as the Options Price Reporting Authority.
Current OPRA participants include: AMEX, BSE, CBOE, ISE, NASDAQ, NYSE Arca, and PHLX. The participants act as a policy committee composed of representatives from each participant exchange and they implement and, subject to Commission approval, amend the policies and procedures set forth in the OPRA Plan.
The exchanges in the United States on which securities options are traded have been authorized under the Securities Exchange Act of 1934 to agree to a "Plan for Reporting of Consolidated Options Last Sale Reports and Quotation Information" (the "Plan"). The exchanges that are parties to the Plan are referred to as the "Participant Exchanges." The plan provides that any securities exchange approved by the Securities and Exchange Commission for the trading of securities options may become a Participant Exchange.
The Plan provides that the system for reporting options information that is described in the Plan is to be administered by the Participant Exchanges through a committee consisting of representatives of the Participant Exchanges. The committee is named the Options Price Reporting Authority or "OPRA." OPRA is the securities information processor for market information generated by trading of securities options in the United States. Last sale reports and quotations are the core of the information that OPRA disseminates. However, OPRA also disseminates certain other types of information with respect to the number of options contracts traded, open interest, end of day summaries, and certain kinds of administrative messages.
OPRA classifies recipients of options information as either "Vendors" or as "Subscribers." A Vendor is an entity that has the contractual right to retransmit options information "externally," i.e., to persons outside its own organization. Each vendor must enter into a "Vendor Agreement" directly with OPRA. The Vendor Agreement describes the rights of the Vendor to receive information and redistribute it to its customers (e.g., broker-dealers, institutional investors, and individual investors). Vendors pay OPRA access and usage fees.
A "Subscriber" is an entity or a person that has the right to use options information only "internally," i.e., within the Subscriber's organization (if the Subscriber is an entity) or himself or herself (if the Subscriber is a human being). A broker-dealer that both uses information internally and distributes it to others (e.g., its brokerage customers) is both a Vendor and a Subscriber.
OPRA classifies Subscribers as either "Professional Subscribers" or as "Nonprofessional Subscribers." A Nonprofessional Subscriber is essentially an individual person who will use the options information only in connection with individual investment activities and not in connection with any trade or business activities and not for the benefit of any other person or any entity, and who is not employed in the securities industry or the commodity futures industry or by a bank or an insurance company or an affiliate of either to perform functions related to securities or commodity futures investment or trading activity. If a person qualifies as a Nonprofessional Subscriber, the person contracts with a Vendor to receive options information, and the Vendor pays OPRA's fee for the Nonprofessional Subscribers receipt of options information.
OPRA classifies all Subscribers other than Nonprofessional Subscribers as Professional Subscribers. A Professional Subscriber may contract directly with OPRA to receive options information and pay fees directly to OPRA. If a Professional Subscriber contracts directly with OPRA, the fees that it pays are either "device-based", i.e., based on the number of devices that the Professional Subscriber has that are capable of receiving options information, or based on the number of "registered representatives" that the Professional Subscriber has. (OPRA refers to fees based on the number of registered representatives as "enterprise-rate" Professional Subscriber fees.)
As an alternative to contracting directly with OPRA, a Professional Subscriber may contract with a Vendor to receive options information. In this case, the Vendor pays "usage-based" fees (sometimes called "per-query" fees) to OPRA for the use of options information by the Professional Subscriber, and the Vendor charges the Professional Subscriber for its use of options information in accordance with the fee schedule established by the Vendor.
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