NASDAQ Vendor Alert #2007-059 - NASDAQ to Introduce Best of NASDAQ Options Data Feed in Coordination with the Launch of the NASDAQ Options Market
Please Route to:
NASDAQ Market Participant Firms
Direct NASDAQ Data Feed Recipients
NASDAQ Market Data Redistributors
Summary:
NASDAQ has announced plans to launch the NASDAQ Options Market in the fourth quarter of 2007, pending approval of the Securities and Exchange Commission (SEC).
In response to requests from market participants, NASDAQ will introduce a proprietary Best of NASDAQ Options data feed that features the following data elements:
Calculation and dissemination of NASDAQ’s best bid and offer position with aggregated size, based on displayable order interest in the NASDAQ Options Market
Dissemination of Last Sale data for option order executions that occur within the NASDAQ Options Market
Overview:
As announced in Head Trader Alert #2007-086, the NASDAQ Stock Market® will launch an equity and index options market in the fourth quarter of 2007, pending SEC approval. In developing the NASDAQ Options Market, NASDAQ® will leverage its core strengths of high performance technology and far-reaching connectivity to operate a fully electronic trading system developed to trade options. The NASDAQ Options Market system will provide for the electronic display and execution of orders in price/time priority without regard to the types of entities entering orders and will offer immediate and automatic price improvement to orders. All NASDAQ members will be eligible to participate in the NASDAQ Options Market system, either as order-entry firms or market makers. The system will also provide a routing service for orders when trading interest is not present on the NASDAQ Options Market and will link with and comply with the obligations of the Options InterMarket Linkage.
As outlined in its proposed rules, NASDAQ plans to operate as a full and equal participant in the national market system for options trading. As a plan participant, NASDAQ will provide its NASDAQ Options Market best bid and offer (BBO) quotation and trade data via the Options Price Reporting Authority (OPRA) data feed. NASDAQ has received several requests from industry and market participants to develop a proprietary data feed that would mimic the data that is being submitted to OPRA.
In support of this request, NASDAQ will introduce Best of NASDAQ OptionsSM (BONOSM), a proprietary data feed designed to carry the same information that will be reported to OPRA as described above. To access the BONO technical documentation, please refer to the NASDAQ Data Products – Direct Data Feed Specifications page.
Market Data Impact:
In response to customer networking needs, NASDAQ will offer the BONO data feed in TCP/IP protocol as well as IP multicast. The BONO bandwidth recommendation will be 20 Megabits (Mb) per data center connection. For firms looking to save on networking costs, NASDAQ will also offer a compressed TCP/IP version of the BONO feed that will require 75% less bandwidth. For information on how to access the proprietary data feeds, please refer to the NASDAQ Connectivity Providers document.
Once NASDAQ Options Market is fully operational, NASDAQ plans to work with the market participants and market data community to determine customer demand for additional proprietary options data products, including depth and analytical data feeds.
Ordering Information:
Distributors must submit the appropriate documentation and receive approval from NASDAQ in order to receive the BONO data feed:
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