Chicago Stock Exchange (CHX) Sets Oct. 29 Start Date For E-Session Extended Trading Hours

Following Securities and Exchange Commission (SEC) approval of its proposal, the Chicago Stock Exchange (CHX) announced yesterday that it will offer a new extended trading hours session from 3:30 p.m. to 5:30 p.m. Central Time starting Oct. 29. The SEC approved the E-Session as a pilot program through March 1, 2000. "On Oct. 29, the Chicago Stock Exchange will introduce its E-Session, offering investors an SEC-registered securities exchange presence in the extended trading hours market," CHX President and CEO Bob Forney said. "The CHX has grown to become the second largest floor-based stock exchange in the U.S. because we are nimble enough to respond to evolving customer needs. We don't know how fast trading during non-traditional hours will grow, but it is here to stay. The CHX moved quickly to enter this market to better serve needs of investors, order sending firms and our own membership," Forney added. Unlike the extended hours session from 3 p.m. to 3:30 p.m. Central Time the CHX already offers, which is primarily for institutional investors, the additional "E-Session" will be structured more to serve the needs of retail investors. As they are during regular hours, orders will be routed and executed via a version of MAX®, the Exchange's automated trading system that currently processes more than 90 percent of the CHX's trade volume and 50 percent of the share volume electronically. Using MAX, CHX specialists will maintain continuous two-sided markets in the stocks they trade. "The CHX system is unique in the way it combines the speed and efficiency of electronic trading with specialists who provide two-sided markets. This model is ideally suited to extended hours trading," said Andrew A. Davis, CHX vice chairman and CEO of Rock Island Company, one of the largest CHX specialist firms. During its E-Session, the CHX will trade all Nasdaq 100 and S&P 100 issues as well as over 100 of the most active non-S&P 100 and non-Nasdaq 100 issues between 3:30 p.m. and 5:30 p.m. Central Time. Prices for trades executed at the CHX during the E-Session will be disseminated via the consolidated tape, making stock quotes for trades that take place at the Exchange during extended hours openly available. The CHX is a self-regulatory organization registered with the SEC. In general, the Exchange's E-Session will operate on the same technological and regulatory infrastructure as the CHX's regular trading session. The E-Session, however, will be completely separate from the regular trading session, meaning that orders must be entered specifically for the E-Session and are good for that session only. Unlike the regular trading hours session, investors will be able to enter only limit orders in the E-Session. A limit-orders-only rule will protect investors while this market matures and gains liquidity. "Now that we have approval, the CHX will spend the next two weeks fine-tuning our operational and technological infrastructure and assisting our members and order-sending firms to prepare for our new extended trading hours," Forney said. The Chicago Stock Exchange was founded May 15, 1882 and is the second most active stock exchange in terms of share and trade volume. The CHX is also the fastest growing exchange providing the strongest force for competition to all U.S. markets. The CHX trades more than 4,500 NYSE, AMEX, Nasdaq and CHX-exclusive issues, more than any other stock exchange in the world.