NYSE & NASDAQ Get Another Competitor, Well Sort Of (NDAQ, NYX)

BATS Trading, Inc. announced Monday it filed with the U.S. Securities and Exchange Commission to become a fully licensed securities exchange so that it would have the same regulations and the same status as both the NYSE Euronext (NYSE:NYX) and that NASDAQ Stock Market (NASDAQ:NDAQ).  In terms of the critical metric of matched market share, BATS claims that it has established itself as the third largest market center in the U.S. just since the January 2006 launch.

Included in the BATS customer base are more than 200 broker-dealers and a broad-based ownership group of Citi, Credit Suisse, GETCO, Lehman Brothers, Lime Brokerage, Morgan Stanley, Merrill Lynch and Wedbush. BATS recently recorded one-day record volume of 774 million shares and routinely has a match rate exceeding 80 percent.

This won’t be a surprise to most exchange watchers as BATS noted even back in July that it was eying an exchange status.  In short, this is moving from more of an ECN (electronic communications network) status to a full exchange status if you want a comparison.  You can see its full fee schedule if you wish.  With all the mergers and developments in exchanges, you just wonder if this one will ever make to a full IPO or if it will stay funded as it is by the backers.

Will saber rattling kill NASDAQ/Dubai?

More mergers coming…

Jon C. Ogg
November 5, 2007