Monday, July 29, 2013

Equity Technical Update #2013 - 25
Limit Up/Limit Down Phase 2 Rollout Plan

Markets Impacted:

Contact Information:

What you need to know:

  • On Monday, August 5, 2013, NASDAQ OMX, in coordination with the other primary listing markets, will begin the first stage of the Phase 2 rollout for Limit Up/Limit Down by initiating in groups of Phase 2 securities each week.
  • In addition, the effective times for all Phase 1 securities and the newly rolled out Phase 2 securities each week will have LULD bands in place from 9:30 a.m. ET - 3:45 p.m. ET. Double wide bands will be in effect from 9:30 a.m. - 9:45 a.m. and again from 3:35 p.m. - 3:45 p.m.
  • A link to the full symbol rollout schedule can be found below.

What is the general plan for Limit Up/Limit Down (LULD) production rollout?

NASDAQ OMX® will begin to rollout in production groups of Phase 2 securities in compliance with the Limit Up/Limit Down Plan starting August 5, 2013.

The LULD bands will begin at 9:30 a.m., Eastern Time (ET) and end at 3:45 p.m., ET each trading day, or fifteen minutes before the close in the case of an early scheduled close. The amended band times will apply to all the Tier 1 symbols and the Tier 2 symbols as they roll out.

NASDAQ OMX currently plans to have all of the stocks applicable to Phase 2 completely rolled out into production over 5 weeks starting August 5th and ending the week of September 3rd. The rollout will be staggered with groups of symbols and increasing amounts added each week.

What securities are included in Phase 2?

Phase 2 will include all Tier 2 NMS securities (except rights and warrants) that are not in Tier 1. Tier 1 (fully implemented) includes symbols in the S&P 500, Russell 1000 and Selected ETPs.

What are the details of the rollout plan for LULD?

NASDAQ's LULD Production Rollout Plan for Phase 2 starting on August 5, 2013 will be as follows:

Schedule by Week Production Rollout
Week 1 - August 5th Adjust times for all Tier 1 stocks for LULD bands to cover from 9:30 a.m. - 3:45 p.m. (double bands from 9:30 a.m. - 9:45 a.m., ET and 3:35 p.m. - 3:45 p.m., ET)

Add 50 Tier 2 NASDAQ stocks
Week 2 - August 12th Add ~10% of Tier 2 NASDAQ stocks
Week 3 - August 19th Add ~20% of Tier 2 NASDAQ stocks
Week 4 - August 26th Add ~30% of Tier 2 NASDAQ stocks
Week 5 - September 3rd Add remaining ~40% of Tier 2 NASDAQ stocks

Do you have a detailed list of the NASDAQ symbols part of the rollout?

Yes. Refer to the complete NASDAQ LULD Phase 2 Symbol Rollout List located on the NASDAQ OMX Trader® webpage.

When will the double wide LULD bands be in effect?

Starting on August 5 all Tier 1 stocks and those rolling out part of Phase 2 will have double wide bands in place from 9:30 a.m. to 9:45 a.m. and 3:35 p.m. to 3:45 p.m. (See ERA #2013-9).

What are the LULD bands?

The Percentage Parameter for Tier 1 Securities are:

Previous Closing Price % Parameter
Greater than $3.00 5%
$0.75 up to and including $3.00 20%
Less than $0.75 Lesser of $0.15 or 75%

The Percentage Parameter for Tier 2 Securities are:

Previous Closing Price % Parameter
Greater than $3.00 10%
$0.75 up to and including $3.00 20%
Less than $0.75 Lesser of $0.15 or 75%

Will NASDAQ conduct any additional weekend tests prior to the production rollout on August 5th?

Yes, as previously announced in ETA #2013-23 NASDAQ will be participating in the final weekend industry wide test on Saturday, July 27, 2013. Additional testing details will be provided in a separate notice.

Where can I find additional information?

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