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Monday, June 29, 2009

Equity Trader Alert #2009 - 44
NASDAQ Provides an Update on Pricing Changes Effective Wednesday, July 1, 2009 and Monday, August 3, 2009

Markets Impacted:

  • The NASDAQ Stock Market
  • The NASDAQ Options Market
  • NASDAQ OMX PHLX

Contact Information:

What you need to know:

  • Effective Wednesday, July 1, 2009, NASDAQ will introduce a discount on remove fees for Tape A and Tape C securities for firms who meet either of the following criteria, pending filing with the SEC on an immediately effective basis:
    • Firms that add significant liquidity to NASDAQ and NASDAQ OMX PHLX
    • Firms that add an average of 125 million shares per day and remove 200 million shares per day on NASDAQ.
  • In addition, effective Wednesday, July 1, 2009, NASDAQ will introduce the following pricing changes as previously announced, pending filing with the SEC on an immediately effective basis:
    • An increased liquidity provider rebate for firms that only send agency orders to NASDAQ.
    • The billable rate for the NASDAQ Closing Cross will be $0.0007.
  • The rebate for firms that add 125 million shares or more per day will remain unchanged and continue to be $0.0295.
  • Effective Monday, August 3, 2009, NASDAQ OMX will introduce new fees for certain ports connected to The NASDAQ Stock Market and The NASDAQ Options Market, subject to approval by the SEC.

What has changed?

Effective Wednesday, July 1, 2009, firms that meet one of the following criteria sets on a monthly basis will be assessed a discounted fee of $0.0027 per share for Tape A and Tape C securities executed on The NASDAQ Stock Market®, pending filing with the Securities and Exchange Commission (SEC) on an immediately effective basis:

  • Member of both NASDAQ® and NASDAQ OMX PHLXSM (PHLX®)
  • Makes markets in 400 or more options classes as a Specialist, Streaming Quote Trader (SQT) or Remote Streaming Quote Trader (RSQT) for PHLX
  • Adds an average of 35 million shares per month to NASDAQ

Or

  • Adds more than an average of 125 million shares per day on NASDAQ
  • Removes greater than 200 million shares per day on NASDAQ

    What is the new pricing for firms that only send agency orders to NASDAQ?

    Effective Wednesday, July 1, 2009, in an effort to encourage greater retail order flow, NASDAQ will introduce a new liquidity provider rebate for firms that send solely agency orders to The NASDAQ Stock Market, pending filing with the SEC on an immediately effective basis.

    Firms that meet all of the following criteria on a monthly basis will be designated as an “Agency Participant” and will receive a liquidity provider rebate of $0.0033 per share executed for all U.S. equity securities:

    • Designate all orders sent to NASDAQ during the month as agency orders
    • Send less than 300,000 orders per day on average for the month
    • Add more than 50 million shares per day on average for the month

    Please note that there will be no rebate for any shares that execute below $1.00.

    How are the criteria for “Agency Participants” calculated?

    Firms will be evaluated as “Agency Participants” by billing status. Therefore, agency orders for a firm would be aggregated with all orders from the firm and its affiliates.

    What is the rate for shares executed in the NASDAQ Closing Cross?

    Effective Wednesday, July 1, 2009, the billable rate for the NASDAQ Closing Cross will be $0.0007, pending filing with the SEC on an immediately effective basis. 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.

    What are the new port fees?

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

    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 find additional information?


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