The New York Stock Exchange (NYSE) and NYSE MKT have temporarily assigned custodial responsibility for approximately 524 New York Stock Exchange (NYSE) and 156 NYSE MKT listed securities from the Designated Market Maker (DMM) unit of Knight Capital Americas LLC to the DMM of GETCO LLC.
Exchange rules permit the temporary reallocation of any security whenever the Exchange believes such reallocation would be in the public interest. Upon Knight Capital Group, Inc’s completion and approval of a recapitalization plan, all temporarily reassigned NYSE and NYSE MKT securities as well as DMM staff, operations and systems oversight will be returned to Knight Capital Americas in a timely manner.
“We believe this interim transition is in the best interests of investors, our listed issuers, market stability and efficiency, as well as Knight, as the firm finalizes its equity financing transaction,” says Larry Leibowitz (pictured), Chief Operating Officer, NYSE Euronext. “Our first priority is to ensure market integrity and an orderly trading environment in which investors and all market participants have confidence. This decision was reached in full cooperation with Knight and GETCO, and we sincerely thank both firms for their invaluable efforts in assuring a smooth transition.”
As part of this temporary reallocation, GETCO will assume responsibility for Knight’s DMM staff and employ GETCO technology and systems throughout the combined operation. NYSE Euronext will continue to work with and monitor the recapitalization plan of Knight prior to returning the DMM allocations to Knight Capital’s DMM business.
Designated Market Makers are responsible for maintaining a fair and orderly market for NYSE and NYSE MKT-listed securities. The DMM supplies continuous liquidity to all market participants throughout the trading day. DMMs play an especially important role for companies at the open and close of trading as well as during times of price dislocation and high volatility.