The US Securities and Exchange Commission (SEC) has approved Nasdaq's plan to integrate its Market Center, Brut and Inet automated execution systems.
Nasdaq acquired the Inet ECN when it paid $934.5 million for Instinet last year. The exchange acquired the Brut ECN in 2004 from SunGard for $190 million.
Nasdaq says the integration of the three platforms will create a single book of liquidity, resulting in increased order interaction, execution speed and fill rates.
The new system will provide improved execution quality and speed, says the stockmarket operator, while maintaining the attributes of Market Center, including market making functionality, attributed quotes and the opening, closing and IPO crosses.
Chris Concannon, executive vice president, Nasdaq, says the exchange is combining the best functional elements and the liquidity from each of the three systems.
"The result will be faster executions and increased order interaction. The integration will spur further innovation and accelerate Nasdaq's growth initiatives in both Nasdaq - and other exchange-listed trading," says Concannon.
System integration in Nasdaq-listed stocks will occur on a security-by-security phase-in currently scheduled for 28 August 2006. Nyse-, Amex- and regional-listed securities will be integrated on a single date, currently targeted for 1 October 2006.
Nasdaq says it will make stocks available for testing of the functionality of the new system on 24 July.