Best of the Week
Most Popular
1.Gold Price Target of USD 2,300 - GoldCore
2.Greece Banking System Collapse Monday as ECB Pulls the Plug, Capital Controls Ahead of GrExit - Nadeem_Walayat
3.Why British Muslims Are Leaving Elysium Paradise for Syrian Hell - Nadeem_Walayat
4.Greece BANKRUPT! Financial and Economic Collapse to Follow IMF Debt Default - Nadeem_Walayat
5.Extreme Gold/Silver Shorting - Zeal_LLC
6.European Empire Strikes Back Against Greek Debt Fantasy, Counting Down to GREXIT - Nadeem_Walayat
7.Gold And Silver – Three Choices: Sell, Hold, Hold and Add. A Trading Treatise - Michael_Noonan
8.Gold and Silver Price Headed for Breakdown - Jordan_Roy_Byrne
9.Greece Crisis OXI - Raul_I_Meijer
10.Flatline Investing and Dead End Debt Schemes - Doug_Wakefield
Last 5 days
Gold GDXJ : Impulse Move Pending - 30th June 15
Fed Interest Rate Increase Could Be Best Thing to Happen to Gold - 30th June 15
Marc Faber - Greece is Basically Bankrupt - 30th June 15
Greece - Shoot the Dog and Sell the Farm - 29th June 15
Grexit?, BIS Warning, Chinese Market Crash & Systemic Risk Shake the Global Economy - 29th June 15
The New "Sharing Economy" May Not Be the Profit Bonanza Everyone's Expecting - 29th June 15
Gold and Silver Greece and Short Positions - 29th June 15
Volatility and Sleep-Walking Markets - 29th June 15
Greece BANKRUPT! Financial and Economic Collapse to Follow IMF Debt Default - 29th June 15
Stock Market More Decline Ahead? - 29th June 15
China Stock Market Crackup - The Final Trap Looms... - 29th June 15
Greece Banking System Collapse Monday as ECB Pulls the Plug, Capital Controls Ahead of GrExit - 28th June 15
Investor Stock Play for Two Growing Missile Threats - 28th June 15
Stock Market Uptrend/downtrend Inflection Point - 27th June 15
Greece Crisis OXI - 27th June 15
Gold And Silver – Three Choices: Sell, Hold, Hold and Add. A Trading Treatise - 27th June 15
It’s Time to Change the Way You Look at Disney Forever - 27th June 15
Flatline Investing and Dead End Debt Schemes - 27th June 15
Stock Market Investors Avoid the "Herd" Like the Plague - 26th June 15
Extreme Gold/Silver Shorting - 26th June 15
USD Daily, Weekly, Monthly & Conclusions - 26th June 15
Gold Price Target of USD 2,300 - 26th June 15
Gold and Silver - Another Successful Option Expiration For the Insiders - 26th June 15
Why Buffett Bet A Billion On Solar Energy - 26th June 15
Fed Taper Talk, And The $10 Bill - 25th June 15
When a Bond Is Not a Bond - 25th June 15
Nature Rebounds - Trends in America Portend a Global Restoration of Nature - 25th June 15
Stocks That Profit... Even When You're Dead Wrong - 25th June 15
When Will US Debt Hit the Wall? - 25th June 15
Ron Paul Warns “They Can’t Print Money Forever” - 25th June 15
In Gold We Trust 2015: Gold Remains In A Secular Bull Market - 25th June 15
European Empire Strikes Back Against Greek Debt Fantasy, Counting Down to GREXIT - 25th June 15
China Syndrome - 24th June 15
Greece - The Only Good Deal For Greece Is NO Deal - 24th June 15
Gold and Silver Price Headed for Breakdown - 24th June 15
Corporations vs. Entrepreneurship - 24th June 15
Sweet Spot for Gold Stock Investors - 24th June 15
It’s the World’s Most Powerful Investment Bank… and Now It’s Going to Work for You - 24th June 15
First Strike Capability - Gold or War - 23rd June 15
Greece / Stock Market Played Like a Bouzouki - 23rd June 15
Gold and Silver Forget Greece, Eyes On the Options - 23rd June 15
What Borders Mean to Europe - 23rd June 15
If You Have Money in a US Bank Account Be Aware! - 22nd June 15
The Most Dangerous Secret of Corporate America - 22nd June 15
Why British Muslims Are Leaving Elysium Paradise for Syrian Hell - 22nd June 15
Euro Uncertainty Reflected in COT Report - 22nd June 15
Stock Market Crash Charts - 22nd June 15
Public Pensions: Live and Let Die - 22nd June 15
De-Greece-ing the Stock Market - 22nd June 15
GOLD: Will Summer 2015 Rally Mark A Cyclical Turning Point? - 21st June 15
The Twilight of Cash? - 21st June 15
Shanghai China Stocks Sink: Déjà vu 2001 & 2007…All Over Again - 21st June 15

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

China Stocks - Where are they going?

NASDAQ Seeks To Pay Market Makers In Exchange For Improved ETF Trade & Quote Performance

Stock-Markets / Market Regulation Apr 14, 2012 - 06:40 AM GMT

By: ETF_Daily_News

Stock-Markets

Jackie Noblett, writing for Ignites.com, spotted a recent SEC filing by Nasdaq that proposes a “Market Quality Program” (MQP) where, “an ETF sponsor would pay an annual fee of $50,000 to $100,000 per ETF to Nasdaq. The fee, which would be in addition to the traditional listing fees, would be passed on to market makers in the form of a rebate in exchange for improving trade and quote performance. Any fees not paid out to market makers would go back to the ETF sponsor.”


The filing states that, “in rewarding Market Makers that are willing to “go the extra mile” to develop liquid markets for MQP Securities, the MQP would clearly benefit traders and investors by encouraging more quote competition, narrower spreads, and greater liquidity… the MQP will lower transaction costs and enhance liquidity in both ETFs and their components, making those securities more attractive to a broader range of investors. In so doing, the MQP will help companies access capital to invest and grow. And the MQP may attract smaller, less developed companies and investment opportunities to a regulated and transparent market and thereby serve the dual function of providing access to on-Exchange listing while expanding investment and trading opportunities to market participants and investors.” 

The filing notes that, “There is support for paid for market making (also known as “PFMM”) at the highest governmental levels. Congressman Patrick McHenry, the Chairman of the House Committee on Governmental Reform and Oversight, for example, recently noted that agreements between issuers and market makers to pay for market making activity “…would allow small companies to produce an orderly, liquid market for their stocks. Research has shown that these agreements, already permitted overseas, have led to a positive influence on liquidity for small public companies.” [Related: SEC Widens Probe of Exchange-Traded Funds]

This program admittedly will require rule changes as it runs against the prohibitions of direct payments to market makers for liquidity imposed by the Financial Industry Regulatory Authority and Nasdaq.  

According to the Ignites.com article, there are many advocates of this program including, Adam Patti, CEO of IndexIQ, Greg Friedman, head of ETF product development at Russell Investments, and Reggie Browne, managing director at Knight Capital Group (NYSE:KCG). The common theme for their enthusiasm is the incentivization of market makers to provide the necessary seed money to bring new products to market. [Related: Financial Industry Regulatory Authority (FINRA) Warns Investors of Gold Stock Scams]

We are curious, what are your thoughts on the new rule change?

See the full SEC filing: HERE

Related: S&P 500 Index (INDEXSP:.INX), SPDR S&P 500 ETF (NYSEARCA:SPY), Nasdaq Composite (INDEXNASDAQ:.IXIC), Dow Jones Industrial Average (INDEXDJX:.DJI).

Submitted by David Bettencourt

www.etfdailynews.com

© 2012 Copyright ETF Daily News - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2015 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Biggest Debt Bomb in History