What will Reg nms change?

Discussion in 'Trading' started by listedguru, Mar 4, 2007.

  1. What changes (if any) do you think reg nms will bring? Will stocks (both listed and nasdaq) trade any differently? Is reg nms good for traders, bad, or indifferent?

  2. When we route orders under reg nms will those orders automatically route to the top of the book? Or do we have to do something to make that happen? Basically is it possible to send out an 'illegal' order that gets filled away from the market or would that order just get killed?

  3. The order will get killed if nyse is working properly (which it doesn't), or if you're a floor broker you can send a magic order thats says you checked the book for liquidity and theres isn't any so you can cross. (which is stupid since if theres isn't any liquidity you should be able to cross anyway)

    Just another B.S. move by the nyse
  4. What about an order on an ecn for a listed stock?

    What about ecn orders for nasdaq stocks?
  5. I think this is an SEC movement, not so much so by the exchanges themselves.
  6. Yep, and because the NYSE is downplaying it's ineptitude, and the SEC is buying their B.S. they're implementing a system change that the NYSE isn't ready for.
  7. Introduction
    The Securities and Exchange Commission announced that the implementation of Regulation NMS will be on March 5th 2007.

    Two major changes will affect traders

    Orders can no longer be traded through by another market center
    Displayed orders can no longer cross or lock the market

    Crossed Market- when the best bid is higher the best offer

    Locked Market- when the best bid is equal to the best offer.

    Trade through- a trade outside of the level 1 price.

    National Best Bid and Offer (NBBO, Level 1 price, inside bid/offer) - the best price available in the market.

    Price sliding-an action done by an ECN where they will display an order at a price different from the order price.

    Pegged Orders- an order that locks and moves with a specific reference point (a level 1 or another market centre). You can use an ARCA pegged order to follow the best CINN bid/offer.

    Intermarket Sweep Order- an order that indicates the trader has already checked all other protected quotes before coming to the market centre. It will trade on the exchange it was sent to and not route out to external markets ignoring the trade through rule and lock cross rule.

    Many ECN have reacted by changing their orders to adapt to the new market.
  8. Anyone notice anything different as a result of reg nms today? My nyse orders have been fine but I've had a few strange nasdaq orders. Orders getting killed not going live, etc. I'm assuming that because of reg nms. Pretty much the nyse has been running like reg nms since hybrid went live I believe (with their routing out, etc)...

  9. The NMS is in place for two weeks. How does this affect your trading?

    Is your trading result being improved or gettting worse?

    For me, I am trading NASDAQ only and the reg NMS is putting me into losing positions for the past two weeks. Still struggling to figour out how to trade under this new rules.

    any comments welcome.
  10. I am not sure that with this new rule we cannot see trade-through anymore.

    I am sure that with this new rule, we donot have price improvement(except at open print).

    Example, if two bids, 100 shares at 10, and another 100 shares at 9.95. Both of them are on nyse. And best bid is 10.05. with the new rule, i think we still can see trade-through but two bids should get filled at 10 and 9.95 not both at 9.95.
    #10     Apr 7, 2007