SEC OKs Expanded NYSE Trading Disclosures

March 16, 2001 (PLANSPONSOR.com) - The Securities and Exchange Commission has approved the New York Stock Exchange's proposal to expand stock-market information. The move is expected to improve trading under the new decimalized stock trading system.

The NYSE will improve its stock quote display to show brokerage firms when there is a meaningful (at least 20,000 shares) number of shares of a specific stock available beyond the best price bid and offered for the stock, according to the NY Times.

Generally, the amount of stock available at the best buy and sell price is available, but there has been criticism that this information is not as helpful in the new decimal trading system.  The Big Board believes that the move will improve market transparency, and enhance trading efficiency.

Institutional investors have expressed concerns regarding the unintended consequences of the shift to decimalization. 

Beginning Monday, the NYSE will disseminate these “depth indications” on eight stocks:

  • Qwest Communications (Q)
  • Avaya Inc. (AV)
  • Lucent Technologies (LU)
  • Gateway (GTW)
  • Black & Decker (BDK)
  • Tupperware (TUP)
  • Franklin Resources (BEN)
  • Sears Roebuck (S)

By March 28, the NYSE plans to expand the indications to all 427 NYSE-listed stocks in the Standard & Poor’s 500-stock index, as well as 20 of the NYSE’s most active foreign stocks.

The NYSE said it will offer additional stock quote depth information as early as mid-April, and plans to open up its specialist traders’ book in all stocks later this year.

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