FR 2024-29035

Nasdaq PHLX, LLC, a self-regulatory organization within the securities industry, has submitted a proposal for a rule change regarding its data feeds. Specifically, the exchange plans to update the sources from which it receives market data, making the Long-Term Stock Exchange (LTSE) its primary source and setting CQS/UQDF as a backup. This change aims to enhance transparency and operational efficiency in handling, routing, and executing orders and meeting regulatory requirements.

General Summary

The document outlines an immediate rule change put forth by Nasdaq PHLX to amend its existing data feed structure. The motivation for this shift is to secure a more robust and diverse set of data sources that supports the stock exchange's operations. With the approval of the U.S. Securities and Exchange Commission (SEC), this change takes effect immediately without the usual 30-day waiting period. The direct data feed from LTSE is anticipated to offer better accuracy and reliability in capturing market behavior, while the backup ensures continuity in case of disruptions.

Significant Issues or Concerns

Several issues arise from this document due primarily to its technical nature and reliance on regulatory jargon. For a layperson, the implications of switching primary data feeds may not be entirely clear, potentially creating confusion around the relevance of LTSE and CQS/UQDF. Moreover, the absence of detailed financial assessments within the document leaves stakeholders in the dark about possible costs or economic benefits associated with the change. Additionally, the use of complex legal references could alienate those not versed in securities law.

Broad Public Impact

This rule change is unlikely to directly affect everyday individuals, although its potential to optimize trading operations may indirectly benefit investors by promoting a more efficient market. Such improvements could lead to more accurate pricing and reduce latency in trade execution, ultimately fostering better market integrity and fairness.

Impact on Specific Stakeholders

From an industry perspective, the rule adjustment is intended to clarify the operational procedures of the Nasdaq PHLX for participating market members and traders. These stakeholders could gain from enhanced data clarity and dependability, fostering a more transparent trading environment. However, smaller brokers or traders who heavily rely on existing feeds might need to adapt to new data sources, which could involve adjustments in their operational frameworks.

The decision to make this amendment effective immediately seems to emphasize the SEC's confidence that the benefits outweigh any potential downside. By sidestepping the 30-day operation delay, the immediate shift is expected to allow market participants to leverage improved data sources without unnecessary waiting. However, swift changes always bear the risk of oversight in coordination or communication, potentially leading to temporary adjustment issues for certain operational arms within the exchange.

In conclusion, while the document reflects a technical adjustment aimed at enhancing market operations, its presentation might benefit from more explicit assessments and a simplified explanation to facilitate broader understanding and engagement from all stakeholders, particularly those less familiar with the intricacies of securities regulations and data feed systems.