Proactice order executions

Discussion in 'Order Execution' started by Szeven, Sep 23, 2005.

  1. Can someone explain this to me? I saw the alert but dont understand what a proactive limit order actually does. Bid/offer example would be great.

    What is the new Proactive Limit Order?

    The Proactive Limit Order (also referred to as Super Aggressive Cross) is a routable order that, if not marketable at the time of entry, will be placed on NASDAQ’s book for routing through the NASDAQ Market CenterSM. If, while on the book, its price is locked or crossed by a quote from a NASDAQ® accessible trading center, the Proactive Limit Order will route out to access the locking/crossing liquidity.

    NBBO ARCA $20.00 NSE $20.02

    A routable order to Buy is entered into NASDAQ at $20.01. As it is not marketable, the order will be added to NASDAQ’s book, creating a new NBBO:

    NBBO NDAQ $20.01 NSE $20.02

    If another venue then enters an offer of $20.01, the NASDAQ Buy order at $20.02 will route out to access the offer of $20.01.

    What will the pricing be for this new order type?

    When the order routes out to access the locking/crossing liquidity, it becomes a liquidity accessing order that incurs a normal routing charge.

    When will the Proactive Limit Order be available?

    The Proactive Limit Order will be available for all NASDAQ/NMS<® stocks and NASDAQSmallCap MarketSM stocks on September 26, 2005.
  2. mnx


    there's a pretty good example in your post. basically it works like a normal limit order but it routes out to other venues if they lock or cross your order *AFTER* it has been placed.

    hope that helps.

  3. the order makes sense to me but who is the broker that's offering it?

  4. I guess i was just confused on whether during routing time priority is still given because i wasnt clear on who was doing the routing. Also, i would assume it would not rebate you if someone crossed down and the order was routed to that venue. Hopefully it does not include attain as one of these other 'venues' thats for sure.
  5. proactive means if the ecn you sent it to can't exectute within there book they re reroute it to another ecn or market maker. i know arca charges another .001 for rerouting