|NYSE Group on Nov. 30 filed with the SEC a proposal to change pricing on NYSE equities transactions for immediate effectiveness. Subject to SEC approval and beginning Dec. 1, 2006, the NYSE will eliminate the $750,000 monthly transaction fee cap for member organizations and establish a flat fee of $0.000275 per share on NYSE-listed transactions. In conjunction with this filing, the NYSE will eliminate specialist commissions on transactions in their assigned NYSE-listed securities, including exchange-traded funds, and will implement a transaction revenue-sharing program with specialist firms and also reduce specialists’ fixed costs through the elimination of certain fees.* NYSE Arca transaction pricing remains unchanged.
The NYSE currently charges a flat fee of $0.00025 per share on equity transactions, subject to a monthly fee cap of $750,000 per member organization. By eliminating the monthly fee cap as proposed in the filing, the effective fee rate will be the same for all member organizations regardless of the amount of volume they send to the NYSE. While the transaction fee is increasing from $0.00025 to $0.000275, the elimination of specialist commissions will generally lead to a lower effective trading cost when compared to the current structure.
“These changes continue our progress toward improving the value proposition for our customers by simplifying and reducing the all-in cost of trading of NYSE-listed securities through the elimination of the specialist commission,” said NYSE Group Executive Vice President and CFO Nelson Chai. “As a result of this filing, specialist firms, which will continue to play an important role at the NYSE, will experience lower fixed costs and participate in a revenue-sharing program that will reward them for providing liquidity to our market.
“For NYSE Group, these changes are designed to be revenue-neutral in the near term, will enhance our ability to attract share volume in our listed stocks, and will allow us to capture incremental revenue as volume grows. The NYSE believes that the combined effect of these fee changes will make its pricing structure more competitive, efficient and transparent.”
The SEC filings related to these proposed changes can be found at www.sec.gov.
* Please refer to http://apps.nyse.com/commdata/pub19b4.nsf/rulefilings?openview for the rule filings.
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