Nasdaq took steps to undercut rivals in a bid to garner more trading in Tape “B” securities–primarily exchange-traded funds.
Effective February 1, Nasdaq reduced take fees on its flagship stock exchange for firms that trade in large quantities.
Previously, all traders paid 30 cents per hundred shares to take liquidity in Tape “B” securities. Now, under a new tiering plan, some will pay as little as 27 cents.
Nasdaq is aiming to be more competitive with rival exchanges such as NYSE Arca and BATS BZX. Arca charges traders 28 cents per hundred shares to take liquidity in Tape “B” securities. BATS BZX charges 29 cents.
The three exchanges control about half of the volume in Tape “B” securities, a segment of the market comprised mostly of ETFs. Since the crash of 2008, volume in ETFs has proven more resilient than volume in stocks.
Under Nasdaq’s pricing change, firms that remove 1.5 percent and add 0.5 percent of the total consolidated volume (TCV) in Tape “B” securities for the month will only have to pay 27 cents per hundred shares to take liquidity.
Firms that remove 0.5 percent and add 0.25 percent of TCV in Tape “B” shares will only have to pay 28 cents per hundred shares to take liquidity. All other traders will continue to pay 30 cents.
