Monday, June 29, 2009

Equity Trader Alert #2009 - 45
NASDAQ to Begin Listing a New ETF on Wednesday, July 1, 2009

What is changing?

Effective Wednesday, July 1, 2009, The NASDAQ Stock Market^® plans to begin trading a new Exchange-Traded Fund (ETF):

• First Trust NASDAQ ABA Community Bank Index Fund (Symbol: QABA) seeks investment results that correspond generally to the price and yield performance, before fees and expense, of the NASDAQ OMX ABA Community Bank Index.

To ensure that investors and traders can evaluate the ETF prices, NASDAQ OMX^SM will also provide intraday and daily valuation information for each ETF via the NASDAQ OMX Global Index Data Service. Please refer to the NASDAQ Index and ETF Valuation Identifiers List for the updated list of ETF valuation symbols.

For more information, refer to the Informational Circular on the NASDAQ OMX Trader^® website.

How will this ETF be traded?

The new ETF will be designated as a NASDAQ Global Market^SM security.

Will there be a Designated Liquidity Provider for this ETF?

In July 2007, NASDAQ^® introduced the ETF Market. The centerpiece of The NASDAQ ETF Market is the Designated Liquidity Provider, a market maker who has been selected to maintain liquidity in qualified ETFs (i.e., Qualified Securities). NASDAQ will require Designated Liquidity Providers to maintain a higher standard of market quality measured by spread, depth and time quoting at or near the National Best Bid and Offer (NBBO). They will receive price incentives to support ETFs during their period of initial listing, when ETFs need to develop more active trading. Designated Liquidity Providers will be selected through a consultative process between ETF sponsors, market-making firms and NASDAQ.

The Designated Liquidity Provider for this ETF will be Kellogg Group.

How can I register as a market maker in this ETF?

You may register as a market maker by contacting NASDAQ Trading Operations at +1 212 231 5100. Market makers in this new ETF can register beginning Wednesday, July 1, 2009.

All purchasers of newly issued ETFs must receive a prospectus or product description.

How is ETF data disseminated?

Quotation and trade data for NASDAQ OMX ETFs is disseminated via UTP Level 1^SM, NASDAQ Level 2^SM and NASDAQ TotalView^® using the trading symbol listed above.

Beginning July 1, 2009, NASDAQ OMX will disseminate the Intraday Portfolio Value (IPV) for the ETF exclusively through the NASDAQ OMX Global Index Data Service under the following symbols:

Expressed as a dollar amount per share, the IPV will be disseminated every one-second from 9:15:00 a.m. to 5:16:00 p.m., ET.

NASDAQ OMX will also begin disseminating daily valuation information for the new ETF on July 1, 2009. These daily valuations will be posted on the NASDAQ OMX Trader^®, website as well as disseminated exclusively through the NASDAQ OMX Global Index Data Service with the following data elements and identifiers:

Please note that NASDAQ will support dissemination on NIDS at 15-second intervals starting at 9:15:00 a.m. rather than 9:30:15 a.m.

Where can I get additional information?

For questions regarding the ETF, please contact:

• Stan Ueland, Vice President, First Trust, at +1 630 51 7633.
• NASDAQ OMX Global Index Group at +1 301 978 8284.
• Will Slattery, Director, NASDAQ Listing Qualifications, at +1 301 978 8088.

For questions regarding the trading of the ETFs on NASDAQ, please contact:

• Transaction Services U.S. Market Sales at +1 800 846 0477.

For questions about quotation and trade data for the ETFs, please contact:

• NASDAQ OMX Global Data Products at +1 301 978 5307.

For all other systems-related questions, please contact:

• NASDAQ OMX Trading Operations at +1 212 231 5100.