The Nasdaq Stock Market will next month roll out its crossing network at no charge to members for the first six months. The pricing will be set at a tenth of a penny for share after that, making it one of the cheapest venues for traders to cross block trades, said Brian Hyndman, senior v.p. of Nasdaq Transaction Services. Nasdaq will run three crossing sessions initially at 10:45 a.m., 12:45 p.m. and 2:45 p.m, and intends to have as many as 10 a day by the end of 2007. The timing of the crossing sessions was selected to grab order flow from independent crossing networks that run their crossing sessions at the top of the hour, Hyndman added.
Nasdaq set its pricing based on customer demands for a cheaper place to cross customer orders. Other crossing platforms charge between a half a penny and 2 cents per share to trade. Those expenses chip away at brokerage profits as most brokerages charge a little more than 2 cents per share to execute orders electronically. Hyndman said Nasdaq would not likely go to continuous crossing, but added that limit orders can automatically be crossed if the orders have not been filled in the electronic market.
Nasdaq set its pricing based on customer demands for a cheaper place to cross customer orders. Other crossing platforms charge between a half a penny and 2 cents per share to trade. Those expenses chip away at brokerage profits as most brokerages charge a little more than 2 cents per share to execute orders electronically. Hyndman said Nasdaq would not likely go to continuous crossing, but added that limit orders can automatically be crossed if the orders have not been filled in the electronic market.
