Nasdaq to cut execution prices

Nasdaq to cut execution prices

US stock market Nasdaq is cutting its execution prices in a bid to drive more trades through its systems.

In a statement Nasdaq says the price cut, which requires SEC approval, will be introduced at the beginning of November, but won't have a material effect on earnings.

According to a report by Dow Jones, because the exchange has different pricing tiers for customers, there isn't one rate at which costs will fall. Price cuts will depend on how often customers use the system - those who use it most frequently will receive the biggest price cuts, while low-frequency users may see little or no change.

Nasdaq says it is also in the process of integrating the Brut ECN - which it acquired from SunGard for $190m in September this year - with its own systems.

The exchange has begun developing a "virtual book" that combines the liquidity of both Nasdaq and Brut exchanges. Nasdaq says the virtual book will result in better executions for customers.

The first phase of this integration is expected to be completed in the first quarter of 2005.

Nasdaq says it already integrated the Brut sales force and service offerings so far and has begun the technology integration of the Brut system. The newly combined sales force is led by Brian Hyndman, SVP, Nasdaq Transaction Services.
Hyndman will also continue his role as president of Brut, reporting to Chris Concannon, executive vice president.

Jennifer Geissel, senior managing director, Nasdaq Transaction Services, is responsible for overseeing the day-to-day activities of the new sales team, and will report to Hyndman.

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