[ by Howard Haykin ]

Amendments to NYSE Rule 13 were adopted by the NYSE, adding 2 self-trade prevention ("STP") modifiers for use by certain market participants.  The proposed STP modifiers are designed to prevent 2 orders from the same market participant identifier (“MPID”) assigned to a member organization from executing against each other.  Here are some of the particulars: 

• Use of the STP modifiers is optional and would not be automatically implemented by the Exchange.

• A member organization can choose to add a STP modifier on eligible orders.

• The STP modifier on the incoming order would determine the interaction between 2 orders marked with STP modifiers, and whether the incoming or the resting order would cancel.

• Both the buy and the sell order would have to include an STP modifier in order to prevent a trade from occurring and to effect a cancel instruction.

• An incoming order with an STP modifier will execute against all available opposite-side interest in Exchange systems, displayed or non-displayed, pursuant to Rule 72, and will be evaluated for cancelation by Exchange systems only to the extent that it would execute against opposite-side interest with an STP modifier with the same MPID.

Two Types of STP Modifiers.   As discussed in detail in the rule filing, the two are: (i) STP Cancel Newest (“STPN”), and (ii) STP Cancel Oldest (“STPO”). 

As proposed, the STP modifiers would be available for limit orders sent to the matching engine by off-Floor participants, except limit orders marked GTC or MTS-IOC. 

Market orders, stop orders, GTCs and MTS-IOC, and orders sent to Floor brokers from off Floor participants with STP modifiers will be rejected.

For further details, go to:   [NYSE Rule Filing 13-17, 2/25/1 ].