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Strategies & Market Trends : Moguls Gold- A Thread That Thinks Like a Fund Manager -- Ignore unavailable to you. Want to Upgrade?

To: HandsOn who wrote (123)	10/1/2000 9:27:02 PM
From: $Mogul	Respond to of 303

Head Trader Alert #2000-69 - September 28, 2000 Nasdaq to Modify SuperMontage Proposal (Alert #2000-69) The Nasdaq Stock Market® intends to file with the Securities and Exchange Commission (SEC) an amendment that will modify its SuperMontageSM proposal in response to issues raised by market participants. The amended proposal will be submitted shortly to the SEC. Here is an outline of the amendment. Nasdaq to Propose Offering a Choice in How Orders Are Displayed A major concern expressed by certain electronic communications networks (ECNs) with the current SuperMontage proposal relates to ECN access fees. Supporters of the proposal as currently written argue that the access fees represent an added cost to the price of a security, and therefore should be reflected in the prices displayed in the SuperMontage for the ECNs, rather than having these fees "hidden" from investors. On the other side, certain ECNs maintain that the inclusion of their fees in the price puts them at a competitive disadvantage, and argued to have their quotes shown without the fee included. In response to concerns raised about the priority and execution rules with respect to ECN access fees, Nasdaq® will be proposing changes to SuperMontage that are intended to give market participants greater choice in their order routing decisions. Specifically, Nasdaq is proposing to design SuperMontage to route non-directed orders (i.e., those that do not specify a particular recipient or group of recipients) to Market Makers or ECNs that are at the best price based strictly on time priority, irrespective of whether they charge an access fee. Nasdaq will also give market participants a choice to allow the system to route orders based on strict time priority that takes access fees into account or based on other criteria, such as size. Additionally, if a market participant wishes to direct an order or orders to a particular firm (similar to the function available in SelectNet® today), SuperMontage will permit it to do so. Next Steps Nasdaq is currently preparing SuperMontage Amendment #8 to its SuperMontage proposal and will forward it to the SEC shortly. The amendment will set forth the proposed changes, and will be subject to SEC review and public comment. Background Description of the SuperMontage Proposal SuperMontage is the proposed successor to Nasdaq's current trading system. The proposal was originally submitted to the SEC on October 1, 1999. Since that time, throughout seven amendments and four comment periods, Nasdaq has worked with all interested parties and the SEC and has modified its proposal to respond to issues raised. SuperMontage, which will provide a mechanism for trading more quickly and efficiently, will also give investors a better understanding of the supply and demand for trading a stock by showing the total number of shares available at the three best prices. By substantially increasing the information available to investors and improving trade executions, it will continue to drive down the cost of trading of its three-level price montage nasdaqtrader.com