They NYSE will be making new changes...
Here is a 10 point <b>summary</b> breakdown of those changes from a NYSE Blog...
Please pick one or more that you can <b>comment on, dissect and discuss</b> that will help better
understand how these changes may make it easier or harder for all of us to trade profitably.<blockquote>1)<b> "The look" goes away.</b> Specialist algorithms will no longer get an exclusive, advance look at incoming orders. In connection with this and other changes in the specialist's role, going forward we're calling them designated market makers (DMMs). The role has evolved enough that a name change is justified.
2) Since they no longer have exclusive information, <b>DMMs will be able to trade on parity.</b> They will be no longer have to stand at the back of the line, which gave them no incentive to quote, improve prices and match orders. They will no longer be the agent for the Display Book. So they will be rewarded for quoting, which benefits other traders, the DMMs themselves, and New York Stock Exchange as a whole.
3) DMMs will have the <b>"affirmative obligation"</b> to maintain an orderly market in their stocks, quote at the national best bid or offer for specified percentages of the time, and facilitate price discovery at the open, close and in periods of significant imbalances. They will provide liquidity to the book based on a Capital Commitment Schedule that will be programmed into the Display Book but will receive no order information.
4) Eliminating the look means <b>reducing order latency</b>, because there will be one less stop for every order to make. Less demand on electronic message capacity, too.
5) <b>DMM economic incentives will be transparent</b> and based on performance, and their performance will be reviewed periodically.
6) The old, artificial barriers that no longer make sense in today's environment are coming down. <b>DMMs will be able to integrate their floor-based trading operations into a related member firm, subject to strict information barriers.</b> This will free up firms to make their talent and technology more mobile and multi-purposed across their upstairs and downstairs operations, and make the floor operations more cost-effective They will also have better access to upstairs capital and will be able to trade derivative securities on other markets for risk-management purposes.
7) <b>Floor brokers</b> will be perfectly positioned to provide their customers with access to the increased value and price discovery resulting from all of the above.
8) Apart from these particular filings, there are excellent changes happening for the <b>floor brokers, too. They will have access to an NYSE-approved algo provider that will give them the ability to match the speed of upstairs smart routers.</b> They will be able to use those algo's to peg orders and also execute trading strategies, including VWAP and convert and parity. Brokers also are getting a new service that helps them get blocks done. The new service enables them to electronically broadcast a stock symbol they're interested in, without giving anything else away; respond to pings from other brokers; and "subscribe" to symbols they want to keep an eye on for interest from others, just like RSS -- kind of like adding a new, electronic dimension to the floor conversation, helping them locate block-sized liquidity.
9) <b>Customers will get a new order type:</b> a reserve order that does not require that any portion of the order be displayed. The order will participate in automatic executions but will not be protected in manual executions, will not participate in the open or close, and the DMM will not have access to it. It's another choice for customers looking for that type of functionality.
10) The <b>changes are starting this August</b> and should take a month or two to implement - pending the SEC's approval.
</blockquote>
Here is a 10 point <b>summary</b> breakdown of those changes from a NYSE Blog...
Please pick one or more that you can <b>comment on, dissect and discuss</b> that will help better
understand how these changes may make it easier or harder for all of us to trade profitably.<blockquote>1)<b> "The look" goes away.</b> Specialist algorithms will no longer get an exclusive, advance look at incoming orders. In connection with this and other changes in the specialist's role, going forward we're calling them designated market makers (DMMs). The role has evolved enough that a name change is justified.
2) Since they no longer have exclusive information, <b>DMMs will be able to trade on parity.</b> They will be no longer have to stand at the back of the line, which gave them no incentive to quote, improve prices and match orders. They will no longer be the agent for the Display Book. So they will be rewarded for quoting, which benefits other traders, the DMMs themselves, and New York Stock Exchange as a whole.
3) DMMs will have the <b>"affirmative obligation"</b> to maintain an orderly market in their stocks, quote at the national best bid or offer for specified percentages of the time, and facilitate price discovery at the open, close and in periods of significant imbalances. They will provide liquidity to the book based on a Capital Commitment Schedule that will be programmed into the Display Book but will receive no order information.
4) Eliminating the look means <b>reducing order latency</b>, because there will be one less stop for every order to make. Less demand on electronic message capacity, too.
5) <b>DMM economic incentives will be transparent</b> and based on performance, and their performance will be reviewed periodically.
6) The old, artificial barriers that no longer make sense in today's environment are coming down. <b>DMMs will be able to integrate their floor-based trading operations into a related member firm, subject to strict information barriers.</b> This will free up firms to make their talent and technology more mobile and multi-purposed across their upstairs and downstairs operations, and make the floor operations more cost-effective They will also have better access to upstairs capital and will be able to trade derivative securities on other markets for risk-management purposes.
7) <b>Floor brokers</b> will be perfectly positioned to provide their customers with access to the increased value and price discovery resulting from all of the above.
8) Apart from these particular filings, there are excellent changes happening for the <b>floor brokers, too. They will have access to an NYSE-approved algo provider that will give them the ability to match the speed of upstairs smart routers.</b> They will be able to use those algo's to peg orders and also execute trading strategies, including VWAP and convert and parity. Brokers also are getting a new service that helps them get blocks done. The new service enables them to electronically broadcast a stock symbol they're interested in, without giving anything else away; respond to pings from other brokers; and "subscribe" to symbols they want to keep an eye on for interest from others, just like RSS -- kind of like adding a new, electronic dimension to the floor conversation, helping them locate block-sized liquidity.
9) <b>Customers will get a new order type:</b> a reserve order that does not require that any portion of the order be displayed. The order will participate in automatic executions but will not be protected in manual executions, will not participate in the open or close, and the DMM will not have access to it. It's another choice for customers looking for that type of functionality.
10) The <b>changes are starting this August</b> and should take a month or two to implement - pending the SEC's approval.
</blockquote>
outside of that we will only find out how the changes work after watching how the market trades. they don't sound too major to me but if it results in more LRPs getting hit then i am all for it!