Commentary

Elaine Wah

Modern Markets, Modern Metrics - A Blog By IEX

In this blog by IEX's Elaine Wah, the newest public exchange looks to refute public claims that the metrics it uses are designed to inflate its own volume numbers and mislead people.

Traders Poll

In his first public speech, SEC Chair Jay Clayton deviated from his prepared remarks and offered his own "off the cuff" comments on market issues. Do you like this change of pace?




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February 24, 2006

What's Driving the NYSE's Hybrid Strategy

By Peter Chapman

In the aftermath of Department of Justice's approval of the New York Stock Exchange/Archipelago Exchange merger, many wonder why the Big Board needs its hybrid plan. Why not just offer traders automatic executions via Arca instead of retrofitting the Big Board?

NYSE exec Bob McSweeney answered this at a recent Security Traders Association event.

"It would be extremely easy for us to have two separate models running side by side... But the purpose of getting so complex was because we want to continue to aggregate that liquidity. So that those who are accessing the market for automatic execution have the benefit of accessing liquidity that is resident with the floor broker. The broker can choose then to scale that interest in an agency interest file, a blind file. Then the order may not sweep up four cents. It may only sweep up two cents because that is resident liquidity within the auction that would not otherwise be available to the auto-ex market. Also, the floor brokers themselves would not miss the market when representing large orders as an auto-ex order sweeps through an ECN-like platform."