Nasdaq ISE Adopts New Best Execution Rule for Options Traders
Published Date: 12/30/2025
Notice
Summary
Nasdaq ISE is rolling out a new rule to make sure brokers always try to get the best deal for their customers when trading options. This rule, effective immediately, matches a similar one from another Nasdaq exchange and helps keep trading fair and clear. Brokers and traders on Nasdaq ISE should get ready to follow this new best execution and anti-interpositioning rule starting now, with no extra fees involved.
Analyzed Economic Effects
2 provisions identified: 2 benefits, 0 costs, 0 mixed.
Brokers Must Seek Best Execution
If you have investments with a broker, the Exchange now codifies that brokers must use reasonable diligence to find the best market so the price you get is as favorable as possible. The rule, filed December 22, 2025, lists factors brokers must consider such as size of the order, speed of execution, clearing costs, market liquidity, number of markets checked, and accessibility of quotations.
Limits on Interpositioning and Channeling
The rule prohibits brokers from inserting a third party between your order and the best market if that interpositioning is inconsistent with the best-execution duty, and it puts the burden on the retail firm to justify using a broker's broker. Channeling orders through a third party is allowed only where there are established correspondent or give-up relationships with executions confirmed directly to the member and where the cost of the service is not borne by the customer.
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