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Friday, May 3, 2013

Equity Trader Alert #2013 - 41
PSX Announces Re-Filing of May 2013 Pricing

Markets Impacted:

Contact Information:

What you need to know:

  • The SEC has determined the PSX Lead Market Maker program requires a public comment period.
  • Consequently, PSX will re-file May pricing based on volume tiers for immediate effectiveness May 3, 2013, and will file the Lead Market Maker program separately.

What is happening

As announced Monday, April 29, 2013, in ETA 2013-36, NASDAQ OMX PSXSM (PSXSM) filed with the Securities and Exchange Commission (SEC) to introduce new pricing to accompany its May 1, 2013 re-launch as a price-time priority market. The filing included the introduction of incentives designed to encourage liquidity providers to meet both volume and quoting requirements, as well as a competitive Lead Market Maker program for Exchange Traded Products.

The SEC has determined that the rules establishing these market making programs are significantly innovative to require public comment and therefore cannot be filed for immediate effectiveness. As a result, the initial pricing filing has not been accepted and PSX will re-file as immediately effective May pricing based on volume requirements only. The Lead Market Making program and other pricing incentives based on quoting requirements will be filed separately as a regular way filing and made available for public comment before becoming operative.

What are the rates to add or remove liquidity?

Pending filing with the SEC, PSX will introduce the following pricing effective May 3, 2013. For complete information on PSX pricing, please see the PSX pricing page.

Fees to remove liquidity (May 3, 2013 - May 31, 2013)

Tape A Tape B Tape C
Firm adds at least 10,000 shares/day on average $0.00275 $0.0025 $0.00275
Routable orders $0.0028 $0.0025 $0.0028
All other orders $0.0030 $0.0030 $0.0030

Rebates to add liquidity (May 3, 2013 - May 31, 2013)

All Securities
Displayed Orders if Firm adds at least 2M shares/day $0.0028
Displayed Orders if Firm adds at least 100,000 shares/day $0.0026
Other displayed orders $0.0020
Midpoint orders $0.0010
Non-displayed orders $0.0005

Why are the take rates marginally different than those previously announced?

Because the initial May pricing filing was not accepted by the SEC, PSX must apply the previously effective fee and rebate schedule to trading activity that occurred on May 1st and 2nd. The new pricing above will become effective pending filing on May 3, 2013.

Consequently, PSX will adjust the fee to remove liquidity in Tape A and C securities to $0.00275 per share (if a participant adds at least 10,000 shares per day on average). This should result in qualifying participants receiving total monthly remove fees during the month approximating those they might have anticipated based on the previous announcement.

What fees and rebates will be applied for trading activity on May 1st and 2nd?

Because its initial May pricing filing was not accepted by the SEC, PSX must apply the previously effective fee and rebate schedule to trading activity that occurred on May 1st and 2nd. The new pricing above will become effective pending filing on May 3, 2013.

Per above, PSX must apply the previously effective fee and rebate schedule to trading activity that occurred on May 1st and 2nd. These rates are as follows:

Fees to remove liquidity (May 1, 2013 - May 2, 2013)

All Securities
Non-routable orders sent via MPIDs adding greater than 0.1% of Total Consolidated Volume (TCV) on average daily $0.0028
Routable Orders $0.0028
All Other Orders $0.0030

Rebates to add liquidity (May 1, 2013 - May 2, 2013)

All Securities
Displayed orders from MPIDs adding greater than 0.1% of Total Consolidated Volume on average daily $0.0028
Displayed orders from MPIDs adding greater than 0.05% of TCV and adding a minimum of 1,000 customer contracts per day on PHLX $0.0028
Other displayed orders $0.0026
Midpoint orders $0.0010
Non-displayed orders $0.0010

Where can I find additional information?


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