No More Shaving Sept 1-2005

Discussion in 'Strategy Development' started by momo trader99, Aug 10, 2005.

  1. The rebate game is getting harder as there will be no more shaving on ANY stocks over 1.00...wondering how this will effect any rebaters.
    momo
     
  2. where did you find that info momo? I couldn't find anything on INET's website.
     
  3. I am trading Nasdaq at Swift Trade now. Is this for real? I am shitting in my pants right now. This could kill my way of trading? I looked at island website and can't find anything.
     
  4. relax folks..I think momo is talking about this but as you can see they extended it.

    http://www.sec.gov/news/press/2005-106.htm
    *new*
    However..if you read the NMS dossier it does say that sub-penny trading is going to be phased out by maximum June 2006 except stocks under 1.00. Not sure why no one is mentioning this to the traders because wouldn't it be prudent to start getting new strategies going now? I know I'm going to ask my boss about it tomorrow.

    *new again*
    oh..another addition to my post. I just did some heavy reading on rule 612 of the NMS. If you read pages 221-224 it states that the SEC has the power to still allow sub-penny trading on securities over $1. They will take the following into consideration during the phase in period:

    a) If the stock is an ETF or derivative
    b) If there is a large volume of sub-penny trading due to price improvement
    c) low price of the security

    There was heavy commentary that QQQQ should be exempt and apparently they are looking at that as a heavy possiblity.
     
  5. I was informed Nasdaq will be implementing this next month.will try to locate the memo.
    momo
     
  6. Her you go as you can see it was just extended but its just around the corner.
    momo

    By WS&T Staff
    August 04, 2005

    SEC Delays Sub-Penny Rule Until January 2006

    The Securities and Exchange Commission (SEC) extended the compliance date for the Sub-Penny Rule under Regulation NMS (Reg NMS) until Jan. 31, 2006. The previous compliance date -- Aug. 29, 2005 -- is less than one month away, the SEC noted in a release announcing the change.

    The SEC said an extension of the compliance data will provide market participants with additional time to address issues related to compliance with Rule 612, make necessary systems changes and resolve implementation issues. Firms also will have time to "ascertain what systems and other changes are necessary to comply with the rule, and develop, implement and test those changes," the SEC release noted.

    The Sub-Penny Rule restricts the number of decimal places to two or four places depending on the quote of the NMS stock, according UNX, an institutional agency broker that notified clients of the market-structure change. UNX also noted that the Sub-Penny Rule was the least controversial of the four primary rulings under Reg NMS.
     
  7. as I said though momo....who knows what's going to change when this comes into play. It's very possible that stocks like JDSU and SUNW that have incredibly high volume on the shaves may stay sub-penny. Also, from the way the SEC is talking Q's will also stay sub-penny due to it's derivative nature.
     
  8. Good. They should bring back the fractional system.
     
  9. jem

    jem

    That would be wonderful.