Obligations and Incentives

The Exchange offers four Market Making schemes to ensure the availability of liquidity in Equities, ETFs, Derivatives and Fixed Income markets.

The Market Making Obligations and Incentives are set by the Exchange. Equity Market liquidity groups are reviewed and published every 6 months (1 January - 1 July), based on the liquidity performance of each security over the preceding 6 months. The Exchange may amend the obligations and incentives from time to time, based on market conditions, as it sees fit. In contrast to equities, Market Making obligations and incentives for fixed income and derivatives instruments do not require periodic review and typically involve a single liquidity group applied across all listed instruments within those asset classes. The Market Making Obligations for ETFs are determined based on mutual agreement between the Fund manager and the Market Maker. The selected group could be changed should the fund manager and the market maker request a change, subject to an approval from the Saudi Exchange.

The obligations and incentives schemes are defined in the below tables:

Equity Market

Classification of securities based on liquidity	Parameters	Single Stock		Single Stock+1
		Obligations	Incentives	Obligations	Incentives
Group A: Very High Liquidity	Minimum Presence of Orders	80%	10%	80%	55% Trading commission discount + 1 Security (Group D or below)
	Minimum Size	Between 50,000 – 250,000		Between 50,000 – 250,000
	Maximum Spread	0.65%		0.65%
	Minimum Value Traded	N/A		≥ 5%
Group B: High Liquidity	Minimum Presence of Orders	70%	20%	70%	70% Trading commission discount + 1 Security (Group D or below)
	Minimum Size	Between 50,000 – 250,000		Between 50,000 – 250,000
	Maximum Spread	0.75%		0.75%
	Minimum Value Traded	N/A		≥ 5%
Group C: Medium Liquidity	Minimum Presence of Orders	60%	70% Trading commission discount	60%	100% Trading commission discount + 1 Security (Group D or below)
	Minimum Size	Between 50,000 – 250,000		Between 50,000 – 250,000
	Maximum Spread	1.00%		1.00%
	Minimum Value Traded	≥ 2.5%		≥ 5%
Group D: Low Liquidity	Minimum Presence of Orders	50%	100% Trading commission discount	50%	100% Trading commission discount
	Minimum Size	Between 50,000 – 250,000		Between 50,000 – 250,000
	Maximum Spread	2.00%		2.00%
	Minimum Value Traded	N/A		N/A
Group E: Very Low Liquidity	Minimum Presence of Orders	50%	100% Trading commission discount	50%	100% Trading commission discount
	Minimum Size	Between 50,000 – 250,000		Between 50,000 – 250,000
	Maximum Spread	Between 3.00% - 5.00%		Between 3.00% - 5.00%
	Minimum Value Traded	N/A		N/A

Derivatives Market

Contract	Code	Contract Months	Obligations	Obligation parameters	Incentives
MT30 Index Futures	SF30	Minimum of one contract month (Maturity)	Maximum Spread	10 Ticks ( 5.0 Index points)	100% Trading commission discount
			Minimum Size	3 Lots
			Minimum Presence of Orders	09:30 - 10:00 (100%) 30 minutes 10:00 - 15:00 (70%) 210 minutes 15:00 – 15:30 (100%) 30 minutes

Fixed Income Market

Classification of Securities	Parameters	Obligations	Incentives
Listed Sukuk and Bonds	Minimum Presence of Orders	50%	100% Trading commission discount
	Minimum Size	100,000
	Maximum Spread	1%

ETFs Market

ETF Group	Parameters	Obligations	Incentives
Group A	Minimum Presence of Orders	80%	100% Trading commission discount
		Minimum Size		50,000
				Maximum Spread		0.65%
Group B				Minimum Presence of Orders		80%
				Minimum Size		50,000
				Maximum Spread		1%
Group C				Minimum Presence of Orders		80%
				Minimum Size		50,000
				Maximum Spread		2%

The selection of the ETF group classification is determined by mutual agreement between the Fund Manager and the Market Maker