Nasdaq OMX Group will ring the opening bell Wednesday morning for itself.
Or at least, its PSX exchange, which will be re-launched soon as a “premier trading venue for exchange-traded products.’’
PSX is being changed from a “price size exchange’’ that gives priority to the size of an order over the speed at which an order arrives to a “price time exchange” like other national exchanges. In its new incarnation, the exchange intends to differentiate itself by focusing on exchange-traded funds and giving market participants unusually high rebates to encourage trading in more varieties of products.
Exchange officials have indicated that details of those rebates and other features of the PSX re-launch will be filed with the Securities and Exchange Commission in the next fortnight and that PSX will take on its new form by the end of June.
The ringing of the bell will take place at the Nasdaq Market Site in Times Square and involve Brad Vopni, Senior Vice President of U.S. Equity Market, Product Management and Strategy, Nasdaq OMX; Michael Blaugrund, Vice President of Equities Product Management, Nasdaq OMX; and, David LaValle, Vice President and Head of ETP Listings, Nasdaq OMX.
The revamped PSX exchange will execute trades in all National Market System securities, but will give special incentives to retail and institutional investors to participate as well as special benefits to firms that register as market makers, committing to make continuous two-sided quotes on exchange-traded products.
The idea that “size matters’’ never took hold at PSX. In February, PSX accounted for three-fourths of one percent of total equities trading in the United States.
Exchange-traded funds have been one of the fastest-growing segments of equities trading, although average daily volume fell from 1.2 billion shares in 2011 to 941,000 in 2012, according to Rosenblatt Securities.
NYSE Euronext already operates an ETF-focused electronic exchange, NYSE Arca. Roughly 93 percent of all exchange-traded products in the United States are listed on Arca.
PSX will not be a listing market.
The Nasdaq Stock Market handles about 10 percent of all ETF-trading in the United States. And ETPs of all kinds account for about 20 percent of the Nasdaq’s overall trading volume.
The Nasdaq Stock Market handled an average of 1 billion shares a day of trading in February, according to statistics kept by BATS Global Markets. The PSX exchange handled an average of about 50 million shares.
