• Sep
  • 25
  • 2006
  • 1:41 PM

Q&A: More than a nickel away

By: Ray Pellecchia
File Under: NYSE, NYSE

A reader writes:

Will we have the ability to auto-execute a bid or offer which is more than 5 cents away from the last trade?
-- Frank

Frank -- Currently, there is indeed a restriction against auto-executing a bid or offer more than 5 cents away from the last sale. That restriction will be eliminated with Phase III. As a reminder, Phase III starts Oct. 6 with a single stock and will roll out gradually through early December.

At the same time, please be aware that the extent of sweeps will instead by governed by Liquidity Replenishment Points. LRPs are a price range in which automatic execution is possible. Reaching an LRP causes the market to briefly go into auction mode, temporarily barring automatic execution, and giving the auction an opportunity to respond to the volatility in the stock.

Pending the SEC's approval, the LRPs will be based on a stock's price and average daily trading volume, as detailed on page 14 of our latest rule filing to the SEC.

Hope that helps, Frank. Thanks for writing.

BTW, talk of nickles always reminds me of Joey Nickles, the annoying uncle in "Annie Hall." Uncle Joey slaps a nickle on his forehead and tells his nephew, the young Woody Allen character, "You can always remember me, Joey Five Cents! Joey Nickles!" And the nephew turns away and mutters under his breath, "What an a------!"

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Comments

I keep hearing about this one security that will kick off the conversion into Phase III. When and where will we find out what security this is? Also, as you gradually roll Phase III out to other securities, when and where will these be announced?

Thanks very much for all the great info thus far, and hopefully (in advance) for an answer to this question.

by Ian Cognito on September 25, 2006 2:11 PM

Ian -- Your nom de plume ranks right down there with that of my previous correspondent, R.U. Crazy. And since I.M. Stillcrazy, I'm happy to answer.

We should have the first news on this front later this week. As soon as we do, we'll alert everyone via e-mail, news release, information memo to members and firms, posting on nyse.com/hybrid, and even on this humble blog. Stay tuned.

The "where and when" phrasing of Ian's question reminds me of the Rodgers and Hart standard, "Where or When." A beautiful melody with a great hook, and a mysterious lyric.

It seems we stood and talked like this before
We looked at each other in the same way then
But I can't remember where or when
The clothes you're wearing are the clothes you wore
The smile you are smiling you were smiling then
But I can't remember where or when

Two things in particular about "Where or When":

1) I could never quite figure out Lorenz Hart's lyric. Does it mean that the details may fade away, but all that endures is love? Or is it supposed to be a song written by a half-amnesiac, kind of like "I Remember It Well"?

2) When our ol' band the Upticks played it -- I think the late, great Lew Horowitz probably introduced us to it on his banjo; thanks, Lewie -- I always loved singing along with the soaring "where or when" part. Un-mic'ed, of course; as a singer, I was an OK drummer; as a drummer, I was an OK PR guy. Anyway, it didn't really matter, because even with a megaphone I wouldn't have been heard; everyone in the room was always singing that refrain, it was that catchy and memorable. If you're too young to know it, go download it; dozens of artists have covered it.

by Ray Pellecchia on September 26, 2006 7:51 AM

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