Friday, April 27, 2012

Equity Trader Alert #2012 - 17
NASDAQ, BX and PSX Pricing Update Effective Tuesday, May 1, 2012

Markets Impacted:

Contact Information:

What you need to know:

  • Effective Tuesday, May 1, 2012, pending filing with the Securities and Exchange Commission (SEC), The NASDAQ Stock Market® (NASDAQ®) will update the following:
    • Rebates for midpoint and other non-displayed orders
    • Investor Support Program (ISP) qualifications and rebates
    • Route Rates for SAVE and SOLV strategies
    • Rebates for Liquidity-adding orders for stocks under $1.00
  • Effective May 1, 2012, pending filing with the SEC, Liquidity-removing orders on NASDAQ OMX BXSM (BXSM) that execute against a midpoint will be free.
  • Effective May 1, 2012, pending filing with the SEC, the PSTG and PSCN routing strategies on NASDAQ OMX PSXSM (PSXSM) will pass through the $0.0014 rebate when removing liquidity on BX.

What is changing in regard to rebates for midpoint and other non-displayed midpoint orders on NASDAQ?

Effective May 1, 2012, liquidity-providing midpoint peg orders will earn a higher rebate than other non-displayed orders. This will allow firms to receive a higher rebate if they are willing to frequently offer price improvement at the midpoint.

Added by Firm Rebate per share
Midpoint peg order (firm adds > 3M shares/day of midpoint liquidity)$0.0017
Midpoint peg order (firm adds <3M shares/day of midpoint liquidity)$0.0015
Other non-displayed orders $0.0010

What is changing in regard to the Investor Support Program?

Effective May 1, 2012, in order to qualify for ISP Tier 1, the percentage of a firm's added volume that comes from ISP ports is increasing from at least 25% to at least 30%. View the NASDAQ Price List for additional qualifications.

In addition, the ISP rebates for each Tier 1, 2 and 3 will be as follows:

Rebate on ISP Shares Rebate on other displayed Shares
Tier 1$0.00005 $0.00005
Tier 2$0.000275 $0.00005
Tier 3$0.000375 $0.00005

What is changing in regard to NASDAQ Route Rates?

Effective May 1, 2012, NASDAQ will make the following changes to the SAVE and SOLV Route Rates:

  • Fees for orders that execute on NASDAQ will be changing from $0.0027 to $0.0030 per share.
  • Fees for orders that execute on NYSE will be changing from $0.0022 to $0.0023 per share.
  • Fees for orders that execute on other protected quotes and additional destinations will be changing from $0.0026 to $0.0029 per share.

What is changing in regard to rebates for stocks under $1.00 on NASDAQ?

Effective May 1, 2012, liquidity-adding orders on NASDAQ for stocks under $1.00 will no longer receive a rebate.

What is changing in regard to BX pricing?

Effective May 1, 2012, liquidity-removing orders on BX that execute against a midpoint will be free.

How are routing fees on PSX changing?

Effective May 1, 2012, PSTG and PSCN routing strategies on PSX will pass through the $0.0014 rebate when removing liquidity on BX.

Where can I find more information?


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