• Mar
  • 28
  • 2007
  • 4:14 PM

Links for March 29, 2007

By: Ray Pellecchia
File Under: NYSE

NYSE Group Launches NYSE Arca Tech 100 ETF; Index designed to track technological innovation: NYSE Group yesterday announced the listing of the NYSE Arca Tech 100 ETF (NYSE: NXT). NXT is based on the price-weighted NYSE Arca Tech 100, a widely recognized benchmark for the technology sector... With holdings from 16 industries, the NYSE Arca Tech 100 ETF’s unique multi-industry spectrum offers a diversified approach to technology investing. (NYSE)

In the ABCs of the NYSE, Macy's Snags the 'M' : The New York Stock Exchange said one of its coveted one-letter stock symbols, "M," would be assigned to Federated Department Stores Inc., which plans to change its name to Macy's Inc... "Changing the parent-company name to Macy's Inc. while trading our shares under the 'M' ticker symbol will make it simple and clear for all investors to understand we are a brand-driven and consumer-oriented company," said Terry J. Lundgren, Federated's chairman, president and chief executive. "Macy's represents about 90% of the revenue of our corporation, and this is another important opportunity to reinforce the recent expansion of the Macy's brand." Federated's shares have traded under FD since 1992. (Wall Street Journal/subscription)

On This Day in 1999: The Dow Jones Industrial Average closes above 10,000 for the first time, finishing the day at 10,006.78. (New York Times "On This Day")

[Hey, do you still have your Dow 10,000 baseball cap? I do. And I remember that day distinctly, because I was one of the lucky people involved in giving out the commemorative hats on the trading floor when the Dow closed above 10,000 for the firs time, and we had a few days when the average was above 10K but fell just below that level at the close. On the days of those misses, imagine us poor PR types holding with bags and bins full of caps, ready to hand them out on the floor, everybody knowing what they were and clamoring for them, not being able to give them out [we made a lot of friends those days], and then having to haul the hats back upstairs to wait for another day. Repeat and wince. Not to mention the mayor and the Dow Jones execs who repeatedly were on standby, waiting to walk out onto the bell balcony in the event of a record close, and having to come back another day. And another day. I laugh at it now, but somehow it didn't seem quite so funny at the time.]

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Comments

Ray, i remember that day. I still got my baseball cap. Its blue w/light blue trim and the "10,000 " on the front. Those were the good ole days. thanks

by tony dey on March 29, 2007 5:03 PM

Ray I have a proposal for hybrid would wonder what this community would think about this.
One of the biggest problems i hear about amongst this web site, retail traders, and other non trade-bots about the hybrid is as follows:
1. No matching
2. Incredibly wild price swings of 80-90cents on seemingly just a few thousand/hundred shares.
3. The general loss of the art of tape reading...

I think i have a solution to still incorperate hybrid and electronic trading, keep SOME of the floor brokers & Specs working and profitable, and improve the overall quality of the NYSE trading community.

What if the NYSE took a look outstanding shares or float, and share price as a determing factor on whether or not the issue will trade electronically. With some of your medium priced high float stocks, violent price swings really do not happen as much. However, on your low float stocks, arbitrary price swings upwards of 50 cents a time occur on an all too regular basis(esp @ 930) This is when specialist matching and price improvement would be crucial and cut volatility drastically.
This 'new' hybrid system would be fluid as well. As stocks split or issue more oustanding shares they will move from auction to electronic. As stocks inflate in value or continue to have small floats (maybe under 50-60 mln) those issues will continue to trade auction style.
To me, this insures there will always be humans on the floor, save some, not all, of specs and floor brokers, and preserve much of the NYSE tradition.

Thanks & Thoughts?

jt

by jt on March 30, 2007 11:23 AM

JT, My man. Thats a great idea. This would mean the NYSE could retain the value of the specialists and add more Matching & Price improvement that is really lacking right now. I really hope the top guys at the NYSE consider this suggestion as some stocks do trade better and require specialists adding value while some others can trade electronically. great post.

by tony dey on March 30, 2007 5:01 PM

JT, I think you are on to something. Good idea!

by steve on April 2, 2007 9:44 AM

JT -- Thanks for making a constructive proposal. Ideas are always welcome here.

You asked for thoughts, and here are mine.

First, your basic premise that the trading floor would participate more on less-liquid stocks is exactly how we originally envisioned the Hybrid Market working. Further, we agree that specialist matching and price improvement add value. (I also want to note that price improvement can come from floor brokers as well.)

Second, IMHO, the issue with your suggestion is that NYSE cannot unilaterally declare that certain securities or categories of securities cannot trade automatically. If we did that, under Reg. NMS, any NYSE quote that is not electronically accessible could be traded through by other markets. I think that would mean that effectively, those stocks would trade only on other markets, not NYSE. That's not the effect you were seeking with your idea.

I don't mean for that comment to cut off the discussion; again, comments and suggestions are encouraged. And again, JT, thanks for the proposal.

by Ray Pellecchia on April 2, 2007 12:10 PM

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