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Thaought that this might be of interest. Ira.
Nasdaq Recommends Extension of Limit Order Protections to Pre-Market
Period
WASHINGTON, July 27 -- The Nasdaq Stock Market® announced that its Board
of Directors today approved for member comment a proposal to extend
limit
order protections to investors who place limit orders for Nasdaq
securities prior
to the market open. From 8:40 a.m. to 9:30 a.m. U.S. Eastern Time, for
customers electing protection of their orders, Market Makers will be
prohibited
from executing trades for their own accounts at prices superior or equal
to a
customer's limit order without providing contemporaneous execution of
the
customer's order.
"Expanding limit order protection to the pre-market will provide
significant
protection to investors," said Frank G. Zarb, Chairman and CEO, of
Nasdaq and
the NASD. "This demonstrates our commitment to ensuring that trading
outside
regular market hours is as fair as possible."
A limit order is a customer order to buy or sell a specified number of
shares of
a security at a specific price.
The expansion of the limit order rule to the pre-market is in response
to a
dramatic increase in the number of customer orders sent to brokers prior
to the
market open. In an attempt to service those orders, member firms are
increasing their trading in the pre-market to manage order imbalances
which
can occur when there are too many buy or sell orders without matching
orders
on the opposite side.
The rule will apply at the customer's discretion. Customers who chose
not to
expose their orders for execution during the pre-market time period will
not be
entitled to limit order protection and will have their orders executed
during
normal market hours.
The Nasdaq Stock Market lists nearly 5,000 companies, has a larger
dollar
volume, and trades more shares per day than any other U.S. market.
Nasdaq is
a subsidiary of the National Association of Securities Dealers, Inc.
(NASD®),
the largest securities-industry, self-regulatory organization in the
United
States. For more information about Nasdaq, visit the Nasdaq Web site at
www.nasdaq.com or the Nasdaq Newsroom(SM) at www.nasdaqnews.com.
SOURCE The Nasdaq Stock Market
/CONTACT: Wayne Lee of The Nasdaq Stock Market, 202-728-8067/
/Web site: http://www.nasdaq.com/
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