NYSE Cuts Trade Times to 5 Milliseconds

from the WSJ:

>>NYSE Cuts Trade Times to 5 Milliseconds

NYSE Euronext cut order-execution times 20-fold at the New York Stock Exchange, part of an effort to catch up to faster competitors that have taken market share.

With the implementation of a new system for processing orders on the NYSE, customers will see trades executed within five milliseconds, compared with 105 milliseconds previously. As recently as 2007, the time was 350 milliseconds.

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While NYSE Euronext has juggled fees to stay competitive, it also is counting on new technology to draw traders, with the new order processing system replacing its 33-year-old SuperDOT platform. The exchange operator also is building a new low-latency network for data centers in New York and London.

The moves aim to reassert NYSE Euronext's dominance in U.S. stock trade, badly dented by intense competition in recent years. This month saw the exchange's share of U.S. stock trading slide to 29%; in March 2008, it had half the market.

Chief Executive Duncan Niederauer this year targeted a 50% market share in stocks listed on the NYSE, a goal he has acknowledged as "aggressive." In late June, NYSE Euronext claimed about 39.9% of trade in so-called Tape A securities.