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Quarterly Report

Another Strong Quarter for NYSE Arca

2018 is likely to be remembered as the year without a summer slowdown, as ETF growth continued without respite over the hot and rainy months. In the last quarter, we saw an uncharacteristically active IPO marketplace and the launch of 46 new ETFs on NYSE Arca. This continues the impressive year-to-date growth, with 200 new ETFs coming to market, representing almost $17 billion in new assets under management. Many of these product launches have come from new ETF asset managers with direct support from the NYSE ETF team.

We expect the lead up to year-end will be even busier: between upcoming changes to U.S. market structure, rule proposals certain to impact the ETF industry, and product development filings which could influence the future for ETF issuers, it’s as important as ever to be proactively engaged with the New York Stock Exchange. We stand ready to support your growth and success during a dynamic time, so please reach out to the team if we can be helpful.

Sincerely,

Douglas M. Yones, ChFC
Head of Exchange Traded Products
New York Stock Exchange

NYSE Arca has the most market share in trading volume, with almost 2x more liquidity than the next largest exchange.
Nearly 80% of all U.S. ETF AUM is listed on NYSE Arca.
NYSE Arca has the narrowest quoted bid/ask spreads.

NYSE Updates


Enhanced Benefits for Exchange Traded Products that Trade on the New York Stock Exchange

The NYSE received SEC approval to list and trade certain exchange traded products on the NYSE Trading Floor for the first time. Historically, the NYSE Trading Floor only traded NYSE-listed securities. That changed this past April when we expanded trading on the Floor to all U.S securities. We are now seeking to further expand the benefits of our unique trading floor by offering the opportunity to list your ETFs on the NYSE - and gain the expertise of an NYSE Designated Market Maker (DMM) to trade your ETFs. ETF issuers will have the choice to list on NYSE Arca or on the NYSE Trading Floor when ETF listings become available in 2019. Stay tuned for more information on this exciting development.

New NYSE Arca Official Closing Price Calculation Delivers Value to Issuers and Investors

Last quarter we implemented a new mechanism for calculating the official Closing Price for NYSE-listed ETFs. Our new patent-pending methodology was designed to ensure that the closing prices for NYSE-Arca Listed securities are closer to the underlying Net Asset Value. Read how this NYSE innovation is delivering performance improvements to less traded NYSE-listed ETFs.

NYSE Group Increases Market Share Lead

The New York Stock Exchange continues to evolve by offering unique marketplaces to suit the needs of different issuers and investors. We now operate five distinct venues: NYSE, NYSE Arca, NYSE National, NYSE American, and the recently acquired Chicago Stock Exchange. Since making electronic ETF trading available on the NYSE Trading Floor, this venue has seen steady growth, now accounting for 2.4% of all daily trading activity in ETFs. NYSE maintains its significant lead as the global home for ETF listings and trading; and the NYSE group of exchanges has seen significant growth in overall U.S. market share throughout 2018.

Market Share by Exchange Group

Regulatory Update

Cash-Settled FLEX ETF Options

In July, the NYSE began the SEC process to modify the rules relating to FLEX Options - customizable equity or index contracts that allow investors to tailor contract terms for exchange-listed and index options. If successful, this rule filing will enable the NYSE to create an exchange-traded FLEX option where the underlying security is an ETF, settled by physical delivery of an ETF or in cash.

This bespoke offering will provide a new avenue for cash-settled FLEX ETF options to be traded on an exchange, and offers investors the potential for price improvement and risk management, as transactions will be centrally cleared rather than trading in the OTC markets.

This is a key initiative for options market makers, the options exchanges, and ETF issuers worldwide.

Industry Update


Modernizing the ETF Rule

On June 28, 2018, the SEC proposed a new ETF Rule designed to standardize and modernize the regulatory framework for most ETFs. This proposal would permit ETFs that satisfy certain conditions to operate within the scope of the Investment Company Act of 1940. Effectively this means that ETFs could come directly to market without the cost and delay of obtaining an exemptive order. The proposed rule would require enhanced website disclosures by ETF issuers, and will allow for the utilization of custom purchase and redemption baskets.

Learn More about the ETF Rule Proposal

ETF Highlights Video

Watch how NYSE supports our ETF issuers

Interested in listing at NYSE?