Nasdaq OMX to roll out third equity exchange in 2010

Nasdaq OMX Group plans to use an exchange license it acquired when it bought the Philadelphia Stock Exchange in 2007 to launch a third equity-trading platform. Eric Noll, executive vice president at Nasdaq OMX, said the exchange is meant to give investors "additional choices that will help supplement their various trading strategies." Pending approval from the Securities and Exchange Commission, the exchange is scheduled to launch in the second half of next year.

The company is working to diversify as upstarts BATS Exchange and Direct Edge now claim more than one-fifth of U.S. stock trading activity, chipping away at a business long dominated by Nasdaq OMX and NYSE Euronext (NYX).

Nasdaq OMX said the new platform will feature a price/size priority model that will allow customers to execute orders through any of Nasdaq's platforms, as opposed to the price/time priority model offered on the Nasdaq Stock Market and Nasdaq OMX BX.

This model will incentivize traders to display larger order size, which appeals to institutions, high-frequency traders and retail investors alike, according to Brian Hyndman, head of transaction services for Nasdaq OMX.

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