.jpg)
- Increases transparency and efficiency; provides more equitable pricing for customers; supports future product, volume and trading platform growth; represents an initial phase in transaction pricing changes.
- Increases transparency and efficiency; provides more equitable pricing for customers; supports future product, volume and trading platform growth; represents an initial phase in transaction pricing changes.
- NYSE Arca Options revised options pricing reflects operating efficiencies gained in the PCX/Archipelago integration
- Fee reductions will be realized; market maker fees will be streamlined to encourage increased liquidity; advanced market structure will result in expanded market making opportunities.
The New York Stock Exchange’s new pricing schedule is in response to customers who have been seeking a simple, competitive, transparent and uniform pricing schedule for trading in NYSE-listed cash equities. The new fee schedule, which has been filed today with the Securities and Exchange Commission (SEC) and will be effective
- Transaction fees on NYSE-listed equities will be based on a fixed rate of 0.00025 per share rather than the current variable fee schedule.
- For NYSE-member firms, the monthly cap on trading NYSE-listed cash equities will be increased to $750,000 from $600,000.
- The long-standing 2% commission cap for NYSE-listed trading on the New York Stock Exchange will be eliminated.
- Free system orders on all NYSE-listed equities transactions will also be eliminated (fees for ETF system orders under 5,100 shares will continue to be waived).
- Specialists will not incur transaction fees for trading ETFs.
“Our new transaction pricing model, which is greatly simplified and more transparent, benefits our customers and reaffirms our commitment to remain the most competitive equities marketplace,” said Catherine R. Kinney, President and Co-Chief Operating Officer, NYSE Group. “This initiative represents our first significant price change in many years, serves as an effective platform to create uniform pricing along our current and future product lines, and allows the Exchange to grow as transaction volume grows.”
NYSE Arca transaction pricing for NYSE-listed securities remains unchanged.
NYSE Arca Revises Option Trading Platform
NYSE Arca’s (formerly the Pacific Exchange) new pricing schedule for options precedes the introduction of its new options trading platform scheduled to be introduced this summer. The market structure, fees, and trading platform are subject to SEC approval. The new fee schedule, effective Aug. 1, 2006 includes the following changes:
- Transaction fees for Market Makers will be reduced from $0.26 per contract to $0.16 per contract.
- Transaction fees for Lead Market Makers will be reduced from $0.26 per contract to $0.09 per contract.
- Transaction fees for Electronic Broker Dealer transactions will be reduced from a combined total of $0.51 to $0.50 per contract.
- One Options Trading Permit (OTP) for Market Makers will be $4,000 per month per OTP. Each OTP will entitle market makers to quote in an expanded number of products of their choosing. Four Market Maker OTPs, totaling $16,000, will allow trading in all exchange products.
- OTP firms acting as Lead Market Makers will be assessed a fee for LMM Rights on a per issue basis in addition to the OTP Trade Participant Rights. LMMs Rights per issue will range from $150 to $3000 per month.
- OTP rights for order entry firms will increase from $750 to $1,000 per month.
- OTP Rights for Floor Brokers will be reduced from $1,500 to $1,000 per month.
- The Cancellation fee will be phased out with the introduction of the new trading platform.
- All application and surcharge fees will be eliminated.
“This is clearly another example of first rate technology and the synergies realized through the Pacific Exchange integration providing new cost efficiencies for investors,” said Jerry Putnam, President and Co-Chief Operating Officer, NYSE Group. “As the options marketplace continues to grow and evolve, it is critical that our market structure and leading technology platform reflect the future needs of the industry and shape its transformation.”
The rule revisions supporting changes to market structure were filed on
The options trading platform, which will replace the PCX Plus trading system, will offer significant improvements in trading system performance, functionality and reliability. The new trading system, which is being developed internally, is being created using components and processes currently in use by NYSE Arca’s equity trading system and will integrate relevant functionality of the existing PCX Plus system.
The NYSE Arca Options system is scheduled to be rolled out over a seven week phase-in period pending SEC approval. It includes functionality for the trading of options in penny increments in preparation for the SEC’s recently announced penny pilot scheduled for implementation in January 2007.
