In an interesting aside to the continuing debate about the Short Order Execution System, the National Association of Securities Dealers has made it clear where it wants SOES terminals placed strictly beyond the physical touch of the public customer.
Rules currently contain a provision that requires SOES order-entry firms to maintain the physical security of Nasdaq equipment located on the premises of the broker dealers to prevent unauthorized entry of information into SOES. According to an NASD Notice to Members last month, the NASD has, to date, interpreted this provision as barring firms from providing direct electronic entry to public customers.
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