Getco Holding Company and Knight Capital Group, which are to formally merge on Monday, have combined their designated market maker units on the floor of the New York Stock Exchange under one identity.
The new unit will be called Knight Capital Americas, and will trade 1,551 NYSE and NYSE MKT securities, making it the largest designated market maker on the two exchanges. The combination goes into effect next Tuesday. A move to physically combine the two units will take place over the course of July.
A designated market maker supports trading in those NYSE- and NYSE MKT-listed securities assigned it. The broker-dealer is akin to the old specialist, and has both stricter quoting obligations than other market makers and higher remuneration.
Both NYSE and NYSE MKT designated market makers trade on the same floor. Some designated market makers trade both NYSE and NYSE MKT names at their posts, but on different panels.
Knight’s designated market making unit trades approximately 512 NYSE and 139 NYSE MKT-listed securities. Getco’s unit trades approximately 900 NYSE-listed securities.
There are now six designated market makers operating on the NYSE floor. Besides the Knight-Getco colossus, Barclays Capital, Goldman Sachs, Virtu Financial, J. Streicher & Co., and Brendan E. Cryan & Co. operate posts. With the merger, Barclays drops to second largest with about 1,200 securities.
