Nasdaq Allows Remote Customer Cross Orders Now
Published Date: 9/2/2025
Notice
Summary
Nasdaq PHLX is updating its rules to allow customers to place special cross orders remotely using new technology. This change helps traders move orders faster and more smoothly starting right away, with no extra fees mentioned. If you trade options on Nasdaq PHLX, this update makes your experience quicker and more flexible.
Analyzed Economic Effects
9 provisions identified: 5 benefits, 3 costs, 1 mixed.
Remote entry for Customer Cross Orders
Phlx will permit Floor Brokers to enter Customer Cross Orders and Complex Customer Cross Orders remotely through the Floor-Based Management System (FBMS) while not physically on the trading floor. The change allows these paired customer cross orders to be entered remotely (or on-floor) using the same entry requirements as electronic members, and will be implemented on or before December 20, 2025.
Complex cross stock/ETF handling by NES
When a Complex Customer Cross Order includes an underlying stock or ETF, Phlx will electronically communicate that stock/ETF component to Nasdaq Execution Services, LLC (NES) for immediate off-exchange execution and reporting. Firms that are FINRA or Nasdaq members must have an AGU with NES, and non-members must have a QSR arrangement to trade orders with a stock/ETF component.
FLEX Index Options position limits set
Phlx will set a separate aggregate position limit of 200,000 contracts for broad-based FLEX Index Options on the same side of the market, and explicitly states there are no position limits for FLEX NDX or XND. This aligns Phlx rule text with other exchanges and Phlx's Options 4A limits.
Auto-execution rules for Customer Cross Orders
Customer Cross Orders will automatically execute upon entry only if the execution is at or between the Exchange's best bid and offer, is not at the same price as a Public Customer Order on the limit order book, will not trade through the NBBO, and are entered in the regular trading increments. Customer Cross Orders are automatically cancelled if they cannot be executed. These rules apply when Floor Brokers enter such orders remotely or on the floor.
Short-sale test and cancellation for complex crosses
If the short-sale price test in Rule 201 of Regulation SHO is triggered for a covered security in the stock component of a Complex Customer Cross Order, NES will not execute a short sale at or below the national best bid unless the order is marked 'short exempt.' If NES cannot execute in accordance with Rule 201, the Complex Customer Cross Order will be canceled back to the entering Floor Broker.
No automatic re-entry on Forced Openings
Phlx will remove the prior ability for a member to instruct the Exchange in writing to automatically re-enter remaining size after a Forced Opening; any unexecuted interest remaining and priced through the Opening Price will be canceled back to the entering participant and the member would need to re-enter the order themselves.
Process modifications during trading halts
With the technology migration Phlx will process order modifications during a trading halt in addition to maintaining existing orders on the book, accepting new orders and quotes, and processing cancels. The change aligns Phlx behavior with Nasdaq ISE during trading halts.
Legging Orders generated at minimum increments
Phlx updated Legging Orders so they will be generated and executed in the minimum increment for that options series (per Options 3, Section 3) rather than potentially at other increments, and removed references to an 'internal' PBBO in routing rules as a result.
Public Customer priority clarified for complex orders
Phlx amended its complex order rules to ensure Public Customer priority on the single-leg book and to add the reference to the Public Customer allocation (Options 3, Section 10(a)(1)(A)) in Options 3, Section 14(d)(2)(ii), reflecting that Public Customer interest on the single-leg book retains priority before executable complex interest at the same price.
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