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Wednesday, July 1, 2009

Equity Trader Alert #2009 - 47
Important: NASDAQ Updates July 1, 2009 Pricing

Markets Impacted:

  • The NASDAQ Stock Market

Contact Information:

What you need to know:

  • The SEC has abrogated an immediately effective filing for a discount on remove fees for firms that add significant liquidity to NASDAQ and PHLX.
  • As announced in Equity Trader Alert #2009-44, NASDAQ planned to introduce a discounted remove fee of $0.0027 per share for Tape A and Tape C securities for firms that add significant liquidity to NASDAQ and NASDAQ OMX PHLX or who add greater than 125 million shares per day and remove greater than 200 million shares per day. NASDAQ will no longer introduce this pricing change for July 1st.
  • In addition, NASDAQ will no longer introduce a $0.0033 liquidity provider rebate for firms that only send agency orders to NASDAQ as of July 1st.
  • Effective today, July 1, 2009, NASDAQ is introducing a new pricing tier for firms that add greater than 35 million shares on average per day and whose total add/remove and routed volume is greater than 150 million shares on average per day in all U.S. equities, pending filing with the SEC on an immediately effective basis.
    • Firms that meet these criteria will receive a discounted remove fee $0.0027 per share for Tape A and Tape C securities executed on NASDAQ.
 

What new pricing is being introduced?

Effective today, July 1, 2009, NASDAQ® is introducing a new pricing tier for firms that add greater than 35 million shares on average per day and whose total add/remove and routed volume is greater than 150 million shares on average per day across all tapes. Firms that meet this criteria will be assessed a discounted remove fee of $0.0027 per share for Tape A and Tape C securities executed on NASDAQ. These changes are pending filing with the Securities and Exchange Commission (SEC) on an immediately effective basis.

What is changing?

NASDAQ will not be introducing a discounted remove fee for Tape A and Tape C securities for firms that add significant liquidity to NASDAQ and NASDAQ OMX PHLXSM (PHLX®) or to firms who add greater than 125 million shares per day and remove greater than 200 million shares per day.

In addition, NASDAQ will no longer introduce a $0.0033 liquidity provider rebate for firms that only send agency orders to NASDAQ.

Why is NASDAQ making these changes?

Due to SEC abrogation of the immediately effective filing for a discount on remove fees for firms that add significant liquidity to NASDAQ and PHLX, NASDAQ is changing its July 1st pricing. NASDAQ has filed this remove fee discount with the SEC for notice and comment, and will keep customers informed regarding the status of that filing.

Are NASDAQ’s rebates to liquidity providers changing?

No, NASDAQ’s rebates to add liquidity will remain unchanged. Rebates continue to be as follows:

All U.S. Equities
Per Share Executed
Greater than 125 million shares added$0.00295
Greater than 35 million shares added$0.0029
Greater than 20 million shares added$0.0025
20 million shares or less added$0.0020

Are NASDAQ Closing Cross and port fees still changing?

Yes. Pending filing with the SEC on an immediately effective basis, effective Wednesday, July 1, 2009, the billable rate for the NASDAQ Closing Cross will be $0.0007. As a reminder, Imbalance-only orders and Continuous Book orders executed as part of the NASDAQ Closing Cross continue to be free of charge. Billable orders executed with a share price below $1.00 will still be charged 0.1% (i.e., 10 basis points) of total dollar volume of the transaction.

Effective Monday, August 3, 2009, the fee for certain port pairs connecting to The NASDAQ Stock Market® and all port pairs connecting to The NASDAQ Options MarketSM will be $500, pending approval by the SEC.

The following port charges will be increased for The NASDAQ Stock Market:

  • FIX
  • OUCH
  • RASH
  • DROP

Please note that firms will be charged for their ports in full month increments. Any port cancellation requests that occur after the first day of the month will be effective on the date requested by the firm. However, the firm will be required to pay for the cancelled port through the rest of the month. FIX/OUCH/RASHports are charged per logical port (Source/MPID combination).

Where can I get additional information?


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