SEC Rejects Nasdaq Algorithmic Trading Platform

Law360, New York (January 15, 2013, 6:49 PM EST) -- The U.S. Securities and Exchange Commission on Friday rejected the Nasdaq OMX Group Inc.'s proposal for providing an algorithmic trading platform for clients that would compete with broker-dealers, citing risk management and competition concerns.

In its ruling, the SEC said Nasdaq Stock Market LLC, a trading unit of the electronic exchange, did not show that it had safeguards in place to prevent erroneous trades that could harm market participants. The exchange also did not sufficiently address concerns from broker-dealers that the new Nasdaq trading mechanism would...
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