Commentary

Joanna Fields
Traders Magazine Online News

Navigating Cybersecurity on a Stretch of "Regulatory Rapids"

In this shared commentary, Aplomb Strategies writes that when considering a firm’s governance structure, a holistic approach makes the most sense.

Traders Poll

Now that the SEC has approved the CHX's petition for a speed bump, will you be more likely to send them your order flow?




Free Site Registration

December 1, 2001

Limit Order Rule Modified

By Gregory Bresiger

Market makers, prevented from stepping in front of customer orders on the OTC Bulletin Board, have seen that restriction eased under a rule modificaton introduced by the SEC.

However, the change in the limit order rule, which will stay in place on a trial basis until February, has received a mixed reception. Under the change, if a customer order price is outside the bid-offer spread in a stock, market makers can price improve' and step ahead of the order.

Several market makers think it is a redundant measure in a market like the Bulletin Board. The market has a plethora of illiquid stocks, they note. Other pros said the change could help market makers. On the surface, the modification would seem to help. Nasdaq defends the change, saying it is unreasonable to expect traders on the Bulletin Board to offer price improvement of a penny before stepping ahead of an order.