Nasdaq to extend risk management product offerings

Source: Nasdaq

The Nasdaq Stock Market, Inc. (NasdaqNM:NDAQ) today announced that it plans to add new Risk Management products to its current offering within its trading platform.

NASDAQ will offer new Risk Management products designed for Clearing Firms, Prime Brokers, Sponsored Access Providers, Proprietary Trading Firms and Retail Firms. This new development is part of NASDAQ's strategy of continuously meeting the demands of its customers in today's dynamic environment. These new products will be rolled-out by the end of the third quarter.

In order to provide customers with increased trading protection on the NASDAQ Market Center and other venues, NASDAQ will offer the following enhancements:

  • The implementation of pre-trade Risk Management functionality that allows risk managers and sponsoring firms to cancel all outstanding orders from firms and prohibit that firm from trading on NASDAQ.
  • Inclusion of firms' activity on other market centers within their NASDAQ monitoring tools enabling customers to view not only NASDAQ, BRUT, and INET but also activity within other market centers.
  • The ability for firms to quickly cancel orders in the new integrated single book via NASDAQ's secure, web-based, front-end products.

"Currently NASDAQ offers firms various risk management tools that allow them to monitor their customer's trading and their own trading activity," commented Chris Concannon, Executive Vice President, NASDAQ. "We are rolling out new risk management functionality with additional safeguards for the benefit of our customers."

Other recent enhancements include new order validation on incoming orders to prevent large price movements caused by customers. Also, since NASDAQ acquired INET, it has provided firms a broader look at their customers' transactions by including INET trades in NASDAQ's monitoring tools. NASDAQ's core risk management services have previously included: execution risk management, monitoring of Trading Activity and notification when trade limits are exceeded for clearing firms, and order validation of incoming orders to the NASDAQ Market Center to prevent large unintended price movements. New risk management services will be filed with the SEC for approval.

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