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Third-Party Private Linkage through Lava Trading |
The American Stock Exchange will be using Lava Trading, through Citigroup Correspondent Clearing Services ("Citi"), as its third-party linkage provider to route orders between market centers. This third-party linkage plan will allow the Amex to access protected quotes to fulfill away market obligations.
Prior to February 5, 2007
AEMI will send out away market obligations to all firm quotations that are at a better price than the next trade that would occur on AEMI and that are the best bid or offer of a national securities exchange or a national securities association. During this migration period, intermarket sweep orders may also be sent to markets that have notified the Amex that they are able to receive and trade them through private linkages.
The following markets have informed the Amex that they wish to receive intermarket sweep orders from the Amex:
International Securities Exchange
Philadelphia Stock Exchange
From February 5, 2007
In accordance with Regulation NMS, AEMI will send out intermarket sweep orders to all automated quotations that are at a better price than the next trade that would occur on AEMI and that are the best bid or offer of a national securities exchange or a national securities association.
Clearing Fees
Citi will assess clearing charges for orders that are routed to another market center monthly, based on the average size of the ticket routed out by Citi to other market centers. Below are the clearing charges:
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| Avg. Size of Outbound Tickets* | Clearing Price Per Share |
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| >= 0 - 150 | $0.001 |
| >= 150 and < 300 | $0.0008 |
| >= 300 and < 500 | $0.0007 |
| >= 500 and < 750 | $0.0006 |
| >= 750 and < 1500 | $0.0005 |
| >= 1500 and < 2500 | $0.0004 |
| >= 2500 and < 6000 | $0.0003 |
| >= 6000 | $0.000257 |
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*The average size of outbound ticket is based on the volume of shares routed out by Citi on behalf of the Amex during a single day, divided by the actual number of orders sent out by Citi that resulted in a trade.
Market Access Fees
Use of a "private linkage" to access the other market centers via Citi will result in Citi being charged by the other market centers for access. Citi will pass these transaction charges to the Amex, who will in turn pass them through to its members. To determine the amount of the market access fees, members will need to consult the fee schedules published by each market center. A $0.003 per share market access fee cap will be imposed on all market centers of upon the implementation of Regulation NMS on February 5, 2007.
Other Fees
Any other fees, such as Section 31 fees, that are assessed to customer orders due to away market obligations will be passed through to the Amex members. To determine the amount of these fees, members will need to consult the fee schedules published by each market center.
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