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Wednesday, September 1, 2010

Equity Trader Alert #2010 - 51
Reminder: September Pricing and Functionality Changes

Markets Impacted:

Contact Information:

What you need to know:

  • NASDAQ OMX® would like to remind market participants of pricing and functionality changes taking effect in September 2010 for The NASDAQ Stock Market® (NASDAQ®).

What is changing in September 2010?

The following NASDAQ pricing changes will take effect on Wednesday, September 1, 2010:

Also effective Wednesday, September 1, 2010, NASDAQ will update the criteria for the Select Market Maker Program, as announced in Equity Trader Alert #2010–49.

Effective Monday, September 13, 2010, NASDAQ will discontinue the Intraday and Post-Close Crosses, as announced in Equity Trader Alert #2010–47.

What is the new pricing for supplemental MPIDs?

Effective Wednesday, September 1, 2010, the first MPID requested by a NASDAQ member firm will continue to be free of charge, and supplemental MPIDs will be charged a fee of $1,000 per MPID, per month.

Supplemental MPIDs can be requested by completing and submitting the Supplemental MPID Form. If you wish to update or cancel an MPID, you must complete and submit the MPID Change Form.

Supplemental MPIDs that are used exclusively for reporting to a facility of the Financial Industry Regulatory AuthorityTM (FINRATM), such as the FINRA/NASDAQ TRFTM or TRACE, will be excluded from this fee.

How are routing fees to the NYSE changing?

Effective Wednesday, September 1, 2010, the fee for routing Directed Odd Lots (including Odd Lot portions of Mixed Lots) to the NYSE will be $0.0021 per share.

How has the Select Market Maker criteria been updated?

The new Select Market Maker Program is designed to reward the most important factor in market stability: aggressive quoting that meets or sets the NBBO. The structure of the program has been simplified with a move from three tiers for securities to two tiers. Tier designations will be determined by Average Daily Volume (ADV) and time spent displaying order at the NBBO.

The following chart defines the updated parameters across both tiers of the Select Market Maker Program:

Tier 1
Tier 2
Securities with ADV of less than 1,000,000 shares
Securities with ADV of more than 1,000,000 shares
Anonymous and Attributable Quotes and Orders
Displayed order at the NBBO at least 15% of the time
Displayed order at the NBBO at least 10% of the time

How is the NASDAQ Crossing Network changing?

Effective Monday, September 13, 2010, NASDAQ will discontinue the Intraday and Post-Close Crosses. Therefore, NASDAQ will no longer execute crosses at 10:45 a.m., 12:45 p.m., 2:45 p.m. and 4:30 p.m., Eastern Time (ET).

After September 10, 2010, orders entered with a Cross Type “I” will no longer be accepted.

Where can I find additional information?

FINRA and TRF (Trade Reporting Facility) are trademarks of Financial Industry Regulatory Authority, Inc.; FINRA/NASDAQ TRF™ is used under license from Financial Industry Regulatory Authority, Inc.

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