Here’s an excerpt from a reminder NYSE Trader notice about the new pricing on trading in Nasdaq issues that starts tomorrow, 1 September, 2010:

NYSE Amex Tape C Inverted Pricing: Effective September 1, 2010, NYSE Amex equities will lower the take fee for all customers to $0.0013 per share from $0.0021 per share in Nasdaq-Listed (Tape C) securities priced above $1, including displayed and non-displayed orders. The client rebate for adding liquidity remains $0.0019.

The NYSE Amex market model in Tape C securities offers:
– One of the lowest take fees in Tape C securities;
– Designated Market Makers (DMMs) for each NASDAQ security;
– One or more Supplemental Liquidity Providers (SLPs) assigned to most securities;
– NYSE Amex Parity and Priority model.

Benefits to NYSE Amex trading in NASDAQ names include:
– Quote and depth obligations for the Designated Market Makers lead to tighter markets and greater liquidity;
– Parity allocation that enables the DMM, any floor broker and the first order in the exchange’s order book to share execution priority at a particular price level;
– An additional market destination providing liquidity in Tape C securities with a differentiated pricing structure.

So starting tomorrow, point your routers to NYSE Amex for trading Nasdaq issues, and gain these benefits while cutting your trading costs.

From Todd Wilemon:

Did you read the good news in your e-mail last week?

NYSE Euronext is cutting fees on both NYSE Amex and NYSE Arca options exchanges. Why? Just because we like you. Well, that and we want to continue to be the exchanges where people trade options. If you have not heard, in January and February, we were the largest U.S. equity options exchange group in the industry! We thank you for choosing us as your trading destination both electronically and at our two state-of-the-art trading floors.

Enough about the past, what does the future look like, you ask? With our new fee schedules now live, the NYSE Amex and NYSE Arca will be the market centers to trade options.

Since I am writing to you from San Francisco, let’s talk about NYSE Arca first. We have established a new “Premium Tier” for electronic transactions in 15 Penny Pilot issues. They are: (drum roll please…)
** SPY ** C ** BAC ** QQQQ
** AAPL ** IWM ** XLF ** GLD
** EEM ** GE ** UNG **FAZ
** DIA ** GDX ** USO
In these “Premium Tier” names, posting credits will increase by $0.05. So if you are posting liquidity in these 15 names, your posting credit will increase to $0.30 for both customer electronic and electronic broker-dealer orders and will increase to $0.35 for market makers’s orders. Yes, the money you get paid to post is going up — we are going hog wild over here on your behalf!

We have also established a new tiered pricing for all the other penny pilot issues that are not in the “Premium Tier” so none of them would feel left out. For our customers who take volume, we have the new “Customer Take Discount Tier.” Customers with take volume (that is removing liquidity) above 1,000,000 contracts per month in non-Premium Tier Penny Pilot issues receive a customer discount that increases the more volume you trade.
• If you take 0 to 999,999 contracts, your take discount in this volume range is $0.00.
• If you take 1,000,000 to 1,999,999 contracts, your take discount in this volume range is $0.05
• If you take 2,000,000 to 2,999,999 contracts, your take discount in this volume range is $0.10
• If you take 3,000,000 or more contracts, your take discount in this volume range is $0.15

If you are a liquidity provider, don’t worry, market makers were not left out! We have the new “Market Maker Post Credit Tier.” Market Makers with posting volume above 1,000,000 contracts per month in non Premium Tier Penny Pilot issues will receive a Market Maker Credit that increases the more volume you trade.
• If you post 0 to 999,999 contracts, your Market Maker Posting Credit is $0.00.
• If you post 1,000,000 to 1,999,999 contracts, your MM posting credit in this volume range is $0.05
• If you post 2,000,000 to 2,999,999 contracts, your MM posting credit in this volume range is $0.10
• If you post 3,000,000 or greater contracts, your MM posting credit in this volume range is $0.15

You understand what this means, don’t you? It is time to get TRADING!

We are also changing the rate for manual firm executions that take place on our newly remodeled trading floor. Firm proprietary and facilitation rates for manual (open outcry) trades will now be $0.18 per contract but will be capped at $2,000 per issue per day. (Broker-dealer rates will remain unchanged at $0.25 per contract with no cap.)

Last but not least, NYSE Arca has cut our Lead Market Maker Rights by 50%. To see the whole schedule of cuts for LMM Rights and for further information on all our changes please see the notice here.

People, the savings are adding up. Now do you understand where I got the title for this post?

Now let’s head a couple thousand miles east to New York and talk about the fee changes on NYSE Amex.

We have started tiered pricing on firm manual (open outcry) trades that take place on the NYSE Amex trading floor. Firm proprietary manual trades will be subject to tiered pricing based on an ATP holder’s monthly volume that clears in the firm range.
• The first 174,999 contracts per month, your per contract rate is $0.25
• 175,000 to 299,999 contracts per month, your per contract rate is $0.20
• 300,000 to 399,999 contracts per month, your per contract rate is $0.15
• 400,000 to 599,999 contracts per month, your per contract rate is $0.10
• 600,000 to 799,999 contracts per month, your per contract rate is $0.05
• 800,000 or greater contracts per month, your per contract rate is $0.02

(Yes that last tier really says $0.02! This is madness but we’re gonna have fun, right?)

Whew! Where was I? Oh yes, Firm proprietary electronic trades will all be billed at a rate of $0.20 per contract.

Electronic broker-dealer rates are being cut down to $0.20 from $0.30. These rates will apply to customer BD and away market maker orders that arrive electronically at NYSE Amex.

We have also established “Professional Customer” designation. This means that trading firms that clear activity where the beneficial account owner clears in the customer range and places on average more than 390 orders a day across the industry will now be known as a professional customer. If you are trading more than 390 orders a day, I tip my hat.

The new professional customer designation will continue to clear in the customer range at OCC but will receive broker dealer treatment for purposes of priority and parity. You will be required to submit your orders with a customer/firm value of “8” in FIX Tag 204 in order to identify yourself as a Professional Customer. Any resulting executions from the handling of orders from this Professional Customer range will not benefit from customer priority and will be subject to the Professional Customer electronic rate of $0.20 per contract and Professional Customer manual rate of $0.25 per contract. If these orders trade against a registered market maker, they will not trigger collection of marketing charges on the market maker side of the trade. Any resulting volume from professional customers will not be used in the calculation of the cancellation fee.

For further information on all these fee changes on the NYSE Amex, please go here.

On both exchanges, “Strategy Trades” rates are changing also. Strategy trades by manual broker dealer or firm facilitation will be billed at $0.25 per contract up to a cap of $750 per day in the same option class. Transaction fees for Strategy Executions are further capped at $25,000 per month per initiating firm. Flex Trades are not eligible for strategy execution treatment.

Also on both exchanges, our fees for the user activity extracts (batch) reports have been cut by 73%.

If you have any questions or want to hear Amy and I discuss these new changes, join us on our webinar April 6, 2010 at 4:30 pm EST. We will also be talking about the Complex Order Book and answering frequently asked questions. Register here.

So to answer the question, “Does the boss know?” Well of course, Ed Boyle knows. We just want to make sure your boss knows…and if you are the boss:

Trade ‘Em Up!

TW

From Todd Wilemon:

Did you read the good news in your e-mail last week?

NYSE Euronext is cutting fees on both NYSE Amex and NYSE Arca options exchanges. Why? Just because we like you. Well, that and we want to continue to be the exchanges where people trade options. If you have not heard, in January and February, we were the largest U.S. equity options exchange group in the industry! We thank you for choosing us as your trading destination both electronically and at our two state-of-the-art trading floors.

Enough about the past, what does the future look like, you ask? With our new fee schedules now live, the NYSE Amex and NYSE Arca will be the market centers to trade options.

Since I am writing to you from San Francisco, let’s talk about NYSE Arca first. We have established a new “Premium Tier” for electronic transactions in 15 Penny Pilot issues. They are: (drum roll please…)
** SPY ** C ** BAC ** QQQQ
** AAPL ** IWM ** XLF ** GLD
** EEM ** GE ** UNG **FAZ
** DIA ** GDX ** USO
In these “Premium Tier” names, posting credits will increase by $0.05. So if you are posting liquidity in these 15 names, your posting credit will increase to $0.30 for both customer electronic and electronic broker-dealer orders and will increase to $0.35 for market makers’s orders. Yes, the money you get paid to post is going up — we are going hog wild over here on your behalf!

We have also established a new tiered pricing for all the other penny pilot issues that are not in the “Premium Tier” so none of them would feel left out. For our customers who take volume, we have the new “Customer Take Discount Tier.” Customers with take volume (that is removing liquidity) above 1,000,000 contracts per month in non-Premium Tier Penny Pilot issues receive a customer discount that increases the more volume you trade.
• If you take 0 to 999,999 contracts, your take discount in this volume range is $0.00.
• If you take 1,000,000 to 1,999,999 contracts, your take discount in this volume range is $0.05
• If you take 2,000,000 to 2,999,999 contracts, your take discount in this volume range is $0.10
• If you take 3,000,000 or more contracts, your take discount in this volume range is $0.15

If you are a liquidity provider, don’t worry, market makers were not left out! We have the new “Market Maker Post Credit Tier.” Market Makers with posting volume above 1,000,000 contracts per month in non Premium Tier Penny Pilot issues will receive a Market Maker Credit that increases the more volume you trade.
• If you post 0 to 999,999 contracts, your Market Maker Posting Credit is $0.00.
• If you post 1,000,000 to 1,999,999 contracts, your MM posting credit in this volume range is $0.05
• If you post 2,000,000 to 2,999,999 contracts, your MM posting credit in this volume range is $0.10
• If you post 3,000,000 or greater contracts, your MM posting credit in this volume range is $0.15

You understand what this means, don’t you? It is time to get TRADING!

We are also changing the rate for manual firm executions that take place on our newly remodeled trading floor. Firm proprietary and facilitation rates for manual (open outcry) trades will now be $0.18 per contract but will be capped at $2,000 per issue per day. (Broker-dealer rates will remain unchanged at $0.25 per contract with no cap.)

Last but not least, NYSE Arca has cut our Lead Market Maker Rights by 50%. To see the whole schedule of cuts for LMM Rights and for further information on all our changes please see the notice here.

People, the savings are adding up. Now do you understand where I got the title for this post?

Now let’s head a couple thousand miles east to New York and talk about the fee changes on NYSE Amex.

We have started tiered pricing on firm manual (open outcry) trades that take place on the NYSE Amex trading floor. Firm proprietary manual trades will be subject to tiered pricing based on an ATP holder’s monthly volume that clears in the firm range.
• The first 174,999 contracts per month, your per contract rate is $0.25
• 175,000 to 299,999 contracts per month, your per contract rate is $0.20
• 300,000 to 399,999 contracts per month, your per contract rate is $0.15
• 400,000 to 599,999 contracts per month, your per contract rate is $0.10
• 600,000 to 799,999 contracts per month, your per contract rate is $0.05
• 800,000 or greater contracts per month, your per contract rate is $0.02

(Yes that last tier really says $0.02! This is madness but we’re gonna have fun, right?)

Whew! Where was I? Oh yes, Firm proprietary electronic trades will all be billed at a rate of $0.20 per contract.

Electronic broker-dealer rates are being cut down to $0.20 from $0.30. These rates will apply to customer BD and away market maker orders that arrive electronically at NYSE Amex.

We have also established “Professional Customer” designation. This means that trading firms that clear activity where the beneficial account owner clears in the customer range and places on average more than 390 orders a day across the industry will now be known as a professional customer. If you are trading more than 390 orders a day, I tip my hat.

The new professional customer designation will continue to clear in the customer range at OCC but will receive broker dealer treatment for purposes of priority and parity. You will be required to submit your orders with a customer/firm value of “8” in FIX Tag 204 in order to identify yourself as a Professional Customer. Any resulting executions from the handling of orders from this Professional Customer range will not benefit from customer priority and will be subject to the Professional Customer electronic rate of $0.20 per contract and Professional Customer manual rate of $0.25 per contract. If these orders trade against a registered market maker, they will not trigger collection of marketing charges on the market maker side of the trade. Any resulting volume from professional customers will not be used in the calculation of the cancellation fee.

For further information on all these fee changes on the NYSE Amex, please go here.

On both exchanges, “Strategy Trades” rates are changing also. Strategy trades by manual broker dealer or firm facilitation will be billed at $0.25 per contract up to a cap of $750 per day in the same option class. Transaction fees for Strategy Executions are further capped at $25,000 per month per initiating firm. Flex Trades are not eligible for strategy execution treatment.

Also on both exchanges, our fees for the user activity extracts (batch) reports have been cut by 73%.

If you have any questions or want to hear Amy and I discuss these new changes, join us on our webinar April 6, 2010 at 4:30 pm EST. We will also be talking about the Complex Order Book and answering frequently asked questions. Register here.

So to answer the question, “Does the boss know?” Well of course, Ed Boyle knows. We just want to make sure your boss knows…and if you are the boss:

Trade ‘Em Up!

TW

The new NYSE Euronext U.S. Equities newsletter is out, reporting on the following topics:

- NYSE Arca Technology Enhancements
- Order Type Updates
- NYSE MatchPoint on Handhelds
- Unit of Count for Market Data
- Manage and Reduce Data Spend
- Liquidity on NYSE Amex Auctions
- Deep Value Algos for Floor Brokers
- NYSE Order Execution Time Reduced
- NYSE Technologies Performance

Click here to read it.

Hey, forgot to include an interesting historical tibit for today, remembering back to when the market sailed the high seas just before it sunk to the bottom:

Today in NYSE History (NYX.com):
03 Aug 1929 — The NYSE allowed member firms to open branch offices on ocean liners.

This post is about an enhancement that probably is of interest only to those who pay really close attention to how the close of trading takes place, but I think it’s a positive change and worth noting if only for that subset of our audience.

And at bottom there’s a shout-out to Abraham Lincoln and Joseph Searles, so some of you might want to skip down to that.

NYSE and NYSE Amex have simplified and streamlined the process of how securities close when there’s an imbalance (more orders to buy than sell or vice versa). Here’s the memo if you need the details, and here is the bloggish summary, paraphrasing from the original:

Previously, when there was no imbalance at the close, there was a single closing transaction, also called a “closing print.” In that print, all of the buy and sell Market on Close orders and marketable Limit on Close orders were paired off at the price of the previous sale on the exchange.

But when there was an imbalance, there were two closing prints. The first closing print included all of the shares constituting the imbalance — that is, those that were not paired off. The price was the offer (in the case of a buy imbalance) or the bid (in case of a sell imbalance). The second closing print went off at the same price and included all of the paired-off MOC and marketable LOC orders.

The reason for doing two prints for closing imbalances was to create transparency. That first closing print told market participants the size of the closing imbalance. But having two prints also meant additional manual processing by the Designated Market Maker, and ran counter to our goal of keeping the close timely and efficient.

Enter a solution that provides more transparency and efficiency. Our NYSE Imbalance Datafeed and NYSE Amex Imbalance Datafeed now provide real-time data about order imbalances. The feeds start at 3:40 p.m. and update every 15 seconds from 3:40-3:50 p.m., and every 5 seconds thereafter until 4 p.m.

That stream of data provides more sunlight than the extra closing print did, and eliminates the additional manual processing. As a result, as of 6 Feb., we moved to single-print closes for imbalance situations.

As the memo puts it: “The consolidation of the prints…will reduce the amount of manual information to be reported by the [Designated Market Maker], thus increasing the speed and efficiency of the closing process, ultimately improving the quality of both markets with timelier reporting of closing transactions.” The memo also includes a specific example of the change, which you might want to check out if I’ve simplified it too much.

BTW, you might have also noticed that the former American Stock Exchange is referred to above as NYSE Amex. That’s the new name, replacing the too-long NYSE Alternext U.S.

• • •

Hey, on the occasion of Abraham Lincoln’s 200th birthday, how’s this for a fitting historic event that occurred on this day 39 years ago?

Today in NYSE History (NYSE.com)
12 Feb. 1970 — Joseph L. Searles III became the first black member of the NYSE.