NYSE Euronext’s proposal for the expansion of the Securities and Exchange Commission’s penny pilot programme, filed by NYSE Arca options, has been approved for market wide implementation by the SEC.
The approval will extend the proposed pilot through 31 December 2010, including four quarterly additions to the pilot consisting of 75 issues each.
"Representing over 85 per cent of the overall volume in US options, this expansion of the penny pilot offers many benefits to the investing public, including increased transparency, improved price discovery and reduced spreads," says Paul Finnegan, senior director, NYSE Euronext US options.
"By adding 300 new issues in a systematic fashion over a defined period of time, the endorsement of NYSE Euronext’s proposal to allow for an appropriate expansion benefits the investing public while safeguarding the integrity of industry quoting activity. We are very pleased with the SEC’s decision and we look forward to offering our customers the highest levels of market quality and execution choice as this program is carefully rolled out."
Highlights of NYSE Euronext’s plan include:
• The addition of the next 300 most active issues into the programme for a total of 363 issues
• The phase in of 75 issues on a quarterly basis
• Provides structure to replace delisted pilot issues on a semi-annual basis
• Excludes high priced underlying issues (>USD200)