The New Age of Options Intermarket Linkage By Christopher Faille, Reporter Monday, February 03, 2003 WASHINGTON - The U.S. options exchanges implemented a plan, long urged upon them by the Securities and Exchange Committee, to communicate electronically with one another (intermarket linkage) in order to enhance best execution across the options market. That linkage was made available at the end of last week in 14 option classes in the smaller-sized orders. Linkage for the smaller-sized orders for other classes will be rolled out over the next month. Beginning April 30, another rollout will begin for linkage for all other orders. âThe implementation of this linkage is a credit to the options exchanges, and I commend their hard work in making it a reality,â said SEC Chairman Harvey Pitt in a statement Friday. The 14 underlying stocks for the options immediately affected are: Apple Computer Corp. (AAPL); Bank of America Corp. (BAC); Eastman Kodak Co. (EK); El Paso Corp. (EP); General Motors Corp. (GM); Hewlett-Packard Cos. (HPQ); Nokia Corp. (NOK); Pepsico Inc. (PEP); Procter & Gamble Co. (PG); Qlogic Corp. (QLC), eBay Inc. (EBAY); Broadcom Corp. (RCQ); Seibel Systems Inc. (SGQ); and Nvidia Corp. (UVA). In a statement acknowledging the landmark, the president and chief executive of the International Securities Exchange, New York, David Krell, said that the ISE has consistently supported the creation of such linkage, which âshould benefit investors and help insure that customersâ orders have every opportunity to receive the very best order executions.â The Options Clearing Corp., which issues and settles all listed options contracts, operates the linkage hub. Intermarket linkage introduces three new order types: principal acting as agent, principal and satisfaction. Principal acting as agent orders represent customer orders eligible for price improvement that are routed from one exchange to another. Principal orders allow market makers to access better quotes on other markets. Satisfaction orders, which will be added in a later phase of linkage, are used to remedy âtrade-throughsââwhen an order is executed at a price inferior to the National Best Bid or Offer