por admin » Jue Ago 03, 2017 7:40 am
NYSE on Track to Lose More ETF Listings
The exchange, long the dominant venue for such products, is facing increased competition from Bats, Nasdaq
Alexander Osipovich
Aug. 3, 2017 5:30 a.m. ET
The ETF industry’s move to spread out its listings was bound to cut into the business of the New York Stock Exchange, pictured above, which remains the largest ETF exchange.
The ETF industry’s move to spread out its listings was bound to cut into the business of the New York Stock Exchange, pictured above, which remains the largest ETF exchange. Photo: carlo allegri/Reuters
The New York Stock Exchange, long the dominant listing venue for U.S. exchange-traded funds, is on track to lose ETF listings for a second straight year as competing exchanges vie for a larger slice of the fast-growing industry.
This week, 50 ETFs from BlackRock Inc.’s BLK -1.03% iShares lineup left NYSE’s Arca trading platform for the competition. Nasdaq Inc. NDAQ -0.15% picked up 20 of the listings worth $124 billion, and Bats took the remaining 30 worth $116 billion. The defections include the $33.1 billion iShares Core MSCI EAFE ETF and the $13.5 billion iShares Edge MSCI Min Vol USA ETF . USMV -0.18%
BlackRock’s moves, announced in late June, are part of the firm’s efforts to diversify its listings venues.
BlackRock and other issuers began to spread their ETFs across multiple platforms following two high-profile market failures two years ago, including an hourslong New York Stock Exchange outage in July 2015 and, the next month, a series of trading halts that caused ETFs to veer from the value of their underlying assets.
So far this year, one of the BlackRock’s nine new listings have gone to NYSE Arca, which remains the home for 209 of 343 of BlackRock’s U.S.-listed ETFs.
The industry’s move to spread out their ETF listings was bound to cut into NYSE Arca’s business because it remains the largest ETF exchange. After this week’s switch-overs, Bats, part of CBOE Holdings Inc., has 221 ETF listings, and Nasdaq has 373.
NYSE Arca listed 1,518 ETFs as of June, according to company records. NYSE’s ETF listings peaked at 1,574 in December 2015 but fell to 1,510 at the end of last year. An NYSE spokeswoman said Wednesday that they have 1,504 ETF listings.
The primary value of ETFs is trading revenue, not listings fees. Bats has made substantial inroads in ETF volumes in recent years and is frequently the market leader, with NYSE not far behind and sometimes taking the top spot.
While ETFs can be bought and sold on any exchange during the day, trading reverts to the listing exchange at the beginning and ending of the trading day. Those few seconds, known as auctions, are some of the busiest and most profitable for exchanges, with trading fees paid by both buyers and sellers, and fewer rebates.
As the largest listing exchange for company stocks and ETFs, NYSE has an outsize advantage in auction trading, an advantage Bats is trying to cut into. Bats has asked the U.S. Securities and Exchange Commission for permission to create a cheaper alternative to the end-of-day auctions that could draw trading away from the listing exchange.
Both NYSE and Nasdaq have urged the SEC to reject Bats’s proposal. The SEC has until Aug. 20 to approve the plan, reject it or open deliberations that could last for months.