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Thursday, March 8, 2018

Equity Trader Alert #2018 - 20
Nasdaq Receives SEC Approval for Midpoint Extended Life Order & Announces Fee Holiday

Category:

  • New Functionality

Markets Impacted:

Contact Information:

Resources:

Nasdaq has received SEC approval for the Midpoint Extended Life Order (M-ELO) and will launch on March 12, 2018.

M-ELO is a new order type that is designed to attract and enable like-minded investors to interact with each other. M-ELO orders will only execute against other M-ELO orders at the midpoint of the NBBO. For more information regarding M-ELO please click here.

As announced in Equity Technical Update #2017 - 5, entering an M-ELO requires a new Cross Type code of “E” and a Display instruction of “M”.

Cross Type / Cross Trade Flag (FIX) Explanation
E Extended Life Order

Nasdaq will also add a new liquidity code on all M-ELO executions.

Liquidity Code Description
n Midpoint Extended Life Order Execution

Pricing*

  • M-ELO executions will be free from March 12, 2018, through May 31, 2018
  • Beginning June 1, 2018, M-ELO executions will incur a fee of $0.0006
  • Firms that meet the two defined thresholds below, will receive an additional month of free M-ELO executions
    • 10% growth of midpoint (Add regular midpoint + M-ELO) in May vs January activity
    • Average of at least 250k daily M-ELO volume during May

*Subject to SEC approval.

Testing Opportunities

Testing is currently available in the Nasdaq Testing Facility (NTF). Production testing will be available during the March 10 User Acceptance Test (UAT).

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Nasdaq (Nasdaq: NDAQ) is a leading global provider of trading, clearing, exchange technology, listing, information and public company services. Through its diverse portfolio of solutions, Nasdaq enables customers to plan, optimize and execute their business vision with confidence, using proven technologies that provide transparency and insight for navigating today's global capital markets. As the creator of the world's first electronic stock market, its technology powers more than 90 marketplaces in 50 countries, and 1 in 10 of the world's securities transactions. Nasdaq is home to approximately 3,900 total listings with a market value of approximately $13 trillion. To learn more, visit: business.nasdaq.com.

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