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Thursday, May 26, 2011

Options Technical Update #2011 - 5
NASDAQ Options Market (NOM) 2.0 Testing Available Beginning June 6, 2011 in the Options Test Facility

Markets Impacted:

Contact Information:

What you need to know:

  • As announced in Options Trader Alert #2011-12, The NASDAQ Options MarketSM (NOM) will implement technological enhancements and updates, referred to as NOM 2.0, in the third quarter of 2011.
  • Participant testing for NOM 2.0 will be available beginning Monday, June 6, 2011, in the Options Testing Facility (OTF) during normal NOM hours of operation.
  • Firms must order NOM 2.0 test ports prior to participating in NOM 2.0 testing.

What has been announced?

As announced in Options Trader Alert #2011-12, NOM will implement technological enhancements and updates, referred to as NOM 2.0, in the third quarter of 2011. Participant testing for NOM 2.0 will be available beginning Monday, June 6, 2011, in the Options Testing Facility (OTF) during normal hours of operation.

What must firms do prior to testing?

Firms must order NOM 2.0 test ports prior to participating in NOM 2.0 testing. Test ports can be ordered by completing and submitting the Port Request form to NASDAQ OMX Subscriber Services. Firms should choose “OTF” as the type of connection.

What functionality can firms test?

Firms will be able to test all NOM 2.0 functionality, using the following interfaces and market data feeds:

Quote and Order Entry testing:

  • SQF – Bulk quoting market maker interface
     
  • OTTO – Order-by-order market making interface
     
  • FIX – Order entry firm interface
     
  • Drop – Drop copy interface containing copies of firm order and execution messages
     
  • CTI – Clearing Trade Interface containing copies of trades sent to the OCC for clearing

Market Data testing:

  • NOM 2.0 ITTO – NOM 2.0 ITTO will only be offered in binary format. NOM 2.0 ITTO will contain all quote (new to NOM 2.0 ITTO) and order (same as current ITTO) messages including all executions. This feed allows subscribers to track the full depth of the NOM quote and order book.
     
  • NOM 2.0 BONO – NOM 2.0 BONO will only be offered as a binary version of the BONO Top-Of-Market data feed containing the best aggregated bid and offer for each symbol traded on NOM.
     
  • GLIMPSE – Retransmission facility providing a snapshot of the NOM order book at any point during the trading day (usually used in conjunction with ITTO).

For more details on the NOM 2.0 market data feed updates and enhancements as well as technical specifications, refer to Data Technical News #2011-7.

What specifications should be used for testing NOM 2.0 in the OTF?

FIX – Firms may test the current NOM FIX interface in the OTF. During the NOM 2.0 rollout, only the current NOM FIX interface will be available. Once the rollout is complete, firms will be migrated to the new FIX interface which provides additional functionality. Testing for the NOM 2.0 FIX interface will be available at a later date.

OTTO – Firms should test OTTO using both the new NOM 2.0 OTTO interface and the current NOM interface. As symbols roll out to NOM 2.0, those symbols will only be available via NOM 2.0 OTTO. Symbols that have not been migrated will only be available via the current OTTO interface. Firms currently using OTTO who are not market makers on NOM will be migrated to FIX on NOM 2.0. These firms should test using FIX.

SQF – Firms should test using the NOM/PHLX SQF interface.

NOMAD – The NOMAD interface will be retired. Firms using NOMAD should test using FIX.

What symbols will be available for testing?

All symbols currently listed on NOM will be available for testing in the OTF. Testing will be provided in a partially migrated mode. A mutually exclusive list of symbols will be available on NOM and NOM 2.0 to allow firms to simulate the NOM 2.0 rollout schedule.

  • Options on underlyings starting with the letters A-C will be available on the NOM 2.0 testing platform
  • All other symbols will be available on the current NOM testing platform

When is testing available?

The Options Testing Facility is available during regular trading hours: orders are accepted starting at 8:00 a.m., Eastern Time (ET), trading begins at 9:30 a.m., the market closes at 4:00 p.m. for most options and 4:15 p.m. for certain ETF and Index options.

Where can I find additional information?


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