NYSE: No extra fee for routing

Discussion in 'Trading' started by BankerBlueChips, Sep 30, 2006.

  1. Question for anyone ..... it seems that if they route to ARCA we will still pay .25 cents per 1000 and they will give the contra the $2.00 per 1000 rebate. It doesnt make sense that they will lose $1.75 on every DOT to ARCA trade.

    I have sent 3 emails to Ray at the NYSE and I have not gotten a response when I pose this question.

    If this is the case.... I will go back to flipping, ask for a zero ticket deal.... go NYSE on LU and NT for 1 million shares each.... offer out on ARCA.... take a flat... and net $1750 x 2 for $3500 like the good 'ol flippin days.

    I attached the link below for your reading enjoyment.


    In anticipation of the SEC’s expected approval of the NMS Linkage Plan that will, in effect, replace the existing Intermarket Trading System Plan (“ITS Plan”), effective October 1, 2006, NYSE LLC will implement a new Linkage Order Fee schedule for equities and ETFs for orders routed to other markets through the NMS Linkage. Order routing fees for equities will be set at 2.5 cents per 100 shares consistent with NYSE transaction fees. Order routing fees for Exchange Traded Funds (ETFs) will be set at our current ETF transaction fee of 30.0 cents per 100 shares.

    While NYSE LLC routes orders out infrequently, the new fees will enable NYSE LLC to recover a portion of the costs imposed on the NYSE by other markets, enhance our ability to provide low cost order execution, and help maintain a simplified pricing and billing structure for our customers.

    The purpose of the new NMS Linkage Plan, like the ITS Plan, is to enable markets to route orders to each other in order to avoid trading through. Trading that takes place over the NMS Linkage System will be performed through the same data processing hardware, software and communications network that comprises the existing ITS System. Unlike the current ITS Plan, under which access to other markets is free, with the implementation of the Linkage Plan, linkage participants will charge each other the transaction fees that are charged to each market’s members.

    The new Linkage Order Fees will extend until the scheduled termination of the NMS Linkage Plan on June 30, 2007.

    * Linkage Order Fee for Equities–per share: $0.00025. The Linkage Order Fee will be billed monthly, is subject to the cap of $750,000 monthly per firm, but is not subject to the cap of $80 per transaction.

    * Linkage Order Fee for ETFs–per share: $0.0030. The Linkage Order Fee will be billed monthly and applies both to ETFs listed on the NYSE and to those traded on the NYSE on a UTP basis. The Linkage Order Fee applies to System Orders under 5,100 shares, is not subject to the cap of $100 per trade for ETFs.

  2. I would think their has to more to this? Seems like a heck of a deal it it's true. Although I wonder how often you would get that arca fill routing through dot?

  3. It's irrelavant how I get the fill..... the point is.... I can send a 1 mm share order thru DOT on LU and offer out on ARCA. I can sit there all day until I am taken. And if I am the last one there to complete the flip..... then I made $1750 before the split with my broker.

    I am not saying this will be my new strategy..... but why would you ever leave an order on DOT when the odds of getting a clean up print are close to zero. Why pay .25 to leave an order out when I can get $2.00 ?!?!?!

    My new strategy for sure will be to DOT everyone and offer out on ARCA. On 500k shares a day which is my average... assuming I do 50% DOT take/ 50% ARCA add.... (and yes I do add 50% of the time)..... I will save $2.00 +.25 (for not using DOT) x 250,000 = $562.50 per day. Multiply that by 20 days and 12 months.... the NYSE just gave me a $135,000+ raise.

    Just doesn't make sense to me..... more to come on this I'm sure.


  4. if everyone is gonna post on arca, and take out on dot, who is left to take out on dot, and who is left to take out on arca, think about that
  5. ig0r


    If NYS can't match the quote, they are required by Reg NMS to route out, so you will get the other market center's price without paying them to take liquidity (like you would if you sent directly to them)
  6. wait you're saying i can post 1k to sell on sdot even though arca is the best bid and they'll reroute to arca and not charge me? for instance arca is offering at .08 and sdot is offering at .07 so if i post to sell on sdot to sell at .008 they'll reoute to sell it at the .008 on arca and charge me nothing. makes no sense as why would i ever sell or buy at the bid or ask on arca and pay the liquidity charge?
  7. ig0r


    You got it chief. It's not nothing, NYSE charges 25 cents/1000 to give or take, but thats a lot less than the $2/3 for arca/isld

    At least according to the press release, I can only imagine that it will change eventually
  8. sdot charges 25 cents per 1000 now so that means nobody will throw markets at arca. we'll see how it goes that means nobody will post anything on sdot and still dump all markets on there knowing they'll reroute.just don't understand how arca will really only pay out liquidy rebates and recieve none? means every one buys there limts on arca and dumps there markets on sdot knowing they'll still get the best fill and only the same charge they pay now on sdot. makes no sense lets see if it sticks
  9. of course nyse will charge you an additional marketcenter fee on top of the routing fee. the world ain't a sugarpie.
  10. There are a couple more posts on the nyse hybrid blog about the fees that the nyse is going to charge for routing to other markets (arca, etc). Everything I'm reading says 2.5 cents per 100 shares (nothing else added on). I just wonder how fast your dot order will execute against an arca order for instance? So this means you can take liqudity on arca for listed stocks and only pay .25 per 1000 (not the $3.00 that arca would charge). Who is going to pay that $3.00?

    #10     Oct 2, 2006