1.3
E*TRADE Securities
2021
4
2022-01-20T22:12:08Z
2021
10
99.51
51.93
5.72
31.57
10.79
CITADEL SECURITIES LLC
30.81
38.72
37.60
15.41
34.21
307784.00
20.0000
69747.48
17.5517
76166.52
26.7875
64261.14
14.9648
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Citadel for NMS equity executions priced below $1.00 per share. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
There is a potential conflict inherent to a market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Citadel receives for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Virtu Americas, LLC
19.72
23.92
21.57
11.21
23.44
198510.92
20.0000
37448.62
14.2941
40258.88
22.4738
33658.66
10.0331
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Virtu Americas, LLC (“Virtu”) to facilitate liquidity provision and price improvement opportunities for its customers. Virtu generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Virtu in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Virtu for NMS equity executions priced below $1.00 per share. E*TRADE and Virtu do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Virtu.
There is a potential conflict inherent to a market maker such as Virtu both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Virtu can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Virtu’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Virtu may collect for executing or facilitating the execution of E*TRADE customer orders, Virtu also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Virtu to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Virtu’s independent order routing and best execution obligations. Exchange rebates provided to Virtu for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Virtu receives for executions of E*TRADE customer orders, although Virtu’s receipt of such rebates potentially increases Virtu’s revenue and thereby the source of funds Virtu may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
G1X Execution Services, LLC
19.17
16.11
16.29
25.83
15.93
117241.21
19.5649
27144.66
19.6006
117878.03
30.2015
29766.44
21.9867
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to G1X Execution Services, LLC (“G1X”) to facilitate liquidity provision and price improvement opportunities for its customers. G1X generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from G1X in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from G1X for NMS equity executions priced below $1.00 per share. E*TRADE and G1X do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to G1X.
There is a potential conflict inherent to a market maker such as G1X both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as G1X can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as G1X’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that G1X may collect for executing or facilitating the execution of E*TRADE customer orders, G1X also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize G1X to route higher percentages of E*TRADE customer orders to particular venues over others, subject to G1X’s independent order routing and best execution obligations. Exchange rebates provided to G1X for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates G1X receives for executions of E*TRADE customer orders, although G1X’s receipt of such rebates potentially increases G1X’s revenue and thereby the source of funds G1X may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Two Sigma Securities, LLC
12.12
7.04
8.35
22.82
7.30
54311.60
19.4375
12726.49
17.3794
73830.77
27.0275
14584.45
21.6615
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Two Sigma Securities, LLC (“Two Sigma”) to facilitate liquidity provision and price improvement opportunities for its customers. Two Sigma generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Two Sigma in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Two Sigma for NMS equity executions priced below $1.00 per share. E*TRADE and Two Sigma do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Two Sigma.
There is a potential conflict inherent to a market maker such as Two Sigma both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Two Sigma can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Two Sigma’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Two Sigma may collect for executing or facilitating the execution of E*TRADE customer orders, Two Sigma also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Two Sigma to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Two Sigma’s independent order routing and best execution obligations. Exchange rebates provided to Two Sigma for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Two Sigma receives for executions of E*TRADE customer orders, although Two Sigma’s receipt of such rebates potentially increases Two Sigma’s revenue and thereby the source of funds Two Sigma may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
UBS Securities, LLC
7.80
4.14
5.88
12.30
13.29
25159.60
19.9984
14587.96
20.5610
38988.10
30.5340
15291.67
23.0737
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to UBS Securities, LLC (“UBS”) to facilitate liquidity provision and price improvement opportunities for its customers. UBS generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from UBS in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from UBS for NMS equity executions priced below $1.00 per share. E*TRADE and UBS do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to UBS.
There is a potential conflict inherent to a market maker such as UBS both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as UBS can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as UBS’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that UBS may collect for executing or facilitating the execution of E*TRADE customer orders, UBS also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize UBS to route higher percentages of E*TRADE customer orders to particular venues over others, subject to UBS’s independent order routing and best execution obligations. Exchange rebates provided to UBS for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates UBS receives for executions of E*TRADE customer orders, although UBS’s receipt of such rebates potentially increases UBS’s revenue and thereby the source of funds UBS may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Jane Street Capital
7.15
10.07
10.18
2.66
4.57
84867.42
20.0042
18575.00
20.0000
11727.40
30.8091
12518.98
20.4941
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Jane Street Capital (“Jane Street”) to facilitate liquidity provision and price improvement opportunities for its customers. Jane Street generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Jane Street in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Jane Street for NMS equity executions priced below $1.00 per share. E*TRADE and Jane Street do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Jane Street.
There is a potential conflict inherent to a market maker such as Jane Street both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Jane Street can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Jane Street’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Jane Street may collect for executing or facilitating the execution of E*TRADE customer orders, Jane Street also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Jane Street to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Jane Street’s independent order routing and best execution obligations. Exchange rebates provided to Jane Street for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Jane Street receives for executions of E*TRADE customer orders, although Jane Street’s receipt of such rebates potentially increases Jane Street’s revenue and thereby the source of funds Jane Street may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
The Nasdaq Stock Market
1.63
0.00
0.05
5.00
0.48
0.00
0.0000
-928.38
-29.0636
20410.12
32.4603
-302.56
-26.3771
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-maE*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to the Nasdaq Stock Market. (“NASDAQ”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under NASDAQ’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because NASDAQ offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to NASDAQ rather than another venue in order to reach a higher tier. E*TRADE and NASDAQ do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the NASDAQ Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to NASDAQ.
The fees E*TRADE pays and rebates E*TRADE receives from NASDAQ for NMS equity executions are determined based on NASDAQ’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by NASDAQ in the NASDAQ Fees Schedule, available at http://www.nasdaqtrader.com/trader.aspx?id=bx_pricing. Please note that NASDAQ’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, NASDAQ paid E*TRADE standard rebate rates of $0.00325 per share for executions priced at $1.00 per share or more and no per share charge for executions priced below $1.00 per share. Executions that removed liquidity from NASDAQ qualified for tiered pricing and E*TRADE was charged fees of $0.003 per share for executions priced at $1.00 per share or more and 0.30% of the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from NASDAQ in the amount of $138,653 in October, $130,586 in November, and $117,546 in December.
E*TRADE also participates in NASDAQ’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the NASDAQ retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on NASDAQ and may realize profits from orders it routes to NASDAQ for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
Cboe EDGX Exchange, Inc.
1.59
0.00
0.09
4.77
0.77
0.00
0.0000
6.91
2.3938
23287.85
31.6417
0.00
0.0000
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to Cboe EDGX Exchange, Inc. (“EDGX”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under EDGX’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because EDGX offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to EDGX rather than another venue in order to reach a higher tier. E*TRADE and EDGX do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the EDGX Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to EDGX.
The fees E*TRADE pays and rebates E*TRADE receives from EDGX for NMS equity executions are determined based on EDGX’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by EDGX in the EDGX Fees Schedule, available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/. Please note that EDGX’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, EDGX paid E*TRADE standard rebate rates of $0.0032 per share for executions priced at $1.00 per share or more and $0.003 per share for executions priced below $1.00 per share. On executions that removed liquidity from EDGX qualified for tiered pricing E*TRADE was not charged a per share fee for executions priced at $1.00 per share or more or charged a per share fee for the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from EDGX in the amount of $189,519 in October, $171,462 in November, and $165,040 in December.
E*TRADE also participates in EDGX’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the EDGX retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on EDGX and may realize profits from orders it routes to EDGX for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
99.12
46.38
10.78
32.85
9.99
CITADEL SECURITIES LLC
31.13
39.03
39.33
16.20
34.72
2164828.12
18.4456
1197648.30
12.7852
509731.80
20.0503
328554.52
7.0215
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Citadel for NMS equity executions priced below $1.00 per share. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
There is a potential conflict inherent to a market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Citadel receives for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Virtu Americas, LLC
19.32
23.64
21.96
11.13
23.32
1225332.58
17.8878
544088.66
10.7492
228175.16
16.8176
116402.17
2.3275
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Virtu Americas, LLC (“Virtu”) to facilitate liquidity provision and price improvement opportunities for its customers. Virtu generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Virtu in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Virtu for NMS equity executions priced below $1.00 per share. E*TRADE and Virtu do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Virtu.
There is a potential conflict inherent to a market maker such as Virtu both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Virtu can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Virtu’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Virtu may collect for executing or facilitating the execution of E*TRADE customer orders, Virtu also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Virtu to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Virtu’s independent order routing and best execution obligations. Exchange rebates provided to Virtu for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Virtu receives for executions of E*TRADE customer orders, although Virtu’s receipt of such rebates potentially increases Virtu’s revenue and thereby the source of funds Virtu may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
G1X Execution Services, LLC
18.59
15.62
15.01
25.10
14.79
746369.65
17.7380
357909.15
12.9392
786515.59
24.4560
154979.74
20.3694
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to G1X Execution Services, LLC (“G1X”) to facilitate liquidity provision and price improvement opportunities for its customers. G1X generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from G1X in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from G1X for NMS equity executions priced below $1.00 per share. E*TRADE and G1X do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to G1X.
There is a potential conflict inherent to a market maker such as G1X both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as G1X can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as G1X’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that G1X may collect for executing or facilitating the execution of E*TRADE customer orders, G1X also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize G1X to route higher percentages of E*TRADE customer orders to particular venues over others, subject to G1X’s independent order routing and best execution obligations. Exchange rebates provided to G1X for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates G1X receives for executions of E*TRADE customer orders, although G1X’s receipt of such rebates potentially increases G1X’s revenue and thereby the source of funds G1X may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Two Sigma Securities, LLC
12.12
7.14
8.01
21.94
7.44
398813.76
18.0461
213495.97
13.0659
400600.23
21.5923
66756.01
18.7111
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Two Sigma Securities, LLC (“Two Sigma”) to facilitate liquidity provision and price improvement opportunities for its customers. Two Sigma generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Two Sigma in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Two Sigma for NMS equity executions priced below $1.00 per share. E*TRADE and Two Sigma do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Two Sigma.
There is a potential conflict inherent to a market maker such as Two Sigma both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Two Sigma can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Two Sigma’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Two Sigma may collect for executing or facilitating the execution of E*TRADE customer orders, Two Sigma also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Two Sigma to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Two Sigma’s independent order routing and best execution obligations. Exchange rebates provided to Two Sigma for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Two Sigma receives for executions of E*TRADE customer orders, although Two Sigma’s receipt of such rebates potentially increases Two Sigma’s revenue and thereby the source of funds Two Sigma may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
UBS Securities, LLC
8.24
4.44
5.55
12.59
14.46
218608.42
18.6649
217342.59
16.6167
271219.07
24.8485
92779.66
20.0980
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to UBS Securities, LLC (“UBS”) to facilitate liquidity provision and price improvement opportunities for its customers. UBS generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from UBS in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from UBS for NMS equity executions priced below $1.00 per share. E*TRADE and UBS do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to UBS.
There is a potential conflict inherent to a market maker such as UBS both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as UBS can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as UBS’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that UBS may collect for executing or facilitating the execution of E*TRADE customer orders, UBS also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize UBS to route higher percentages of E*TRADE customer orders to particular venues over others, subject to UBS’s independent order routing and best execution obligations. Exchange rebates provided to UBS for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates UBS receives for executions of E*TRADE customer orders, although UBS’s receipt of such rebates potentially increases UBS’s revenue and thereby the source of funds UBS may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Jane Street Capital
7.03
10.13
10.06
2.64
3.79
529828.39
18.1940
272529.44
12.6976
62739.48
24.0467
37591.52
18.9282
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Jane Street Capital (“Jane Street”) to facilitate liquidity provision and price improvement opportunities for its customers. Jane Street generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Jane Street in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Jane Street for NMS equity executions priced below $1.00 per share. E*TRADE and Jane Street do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Jane Street.
There is a potential conflict inherent to a market maker such as Jane Street both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Jane Street can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Jane Street’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Jane Street may collect for executing or facilitating the execution of E*TRADE customer orders, Jane Street also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Jane Street to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Jane Street’s independent order routing and best execution obligations. Exchange rebates provided to Jane Street for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Jane Street receives for executions of E*TRADE customer orders, although Jane Street’s receipt of such rebates potentially increases Jane Street’s revenue and thereby the source of funds Jane Street may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Cboe EDGX Exchange, Inc.
1.85
0.00
0.04
5.35
0.91
0.00
0.0000
10.50
0.1892
166805.16
25.4071
0.00
0.0000
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to Cboe EDGX Exchange, Inc. (“EDGX”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under EDGX’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because EDGX offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to EDGX rather than another venue in order to reach a higher tier. E*TRADE and EDGX do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the EDGX Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to EDGX.
The fees E*TRADE pays and rebates E*TRADE receives from EDGX for NMS equity executions are determined based on EDGX’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by EDGX in the EDGX Fees Schedule, available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/. Please note that EDGX’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, EDGX paid E*TRADE standard rebate rates of $0.0032 per share for executions priced at $1.00 per share or more and $0.003 per share for executions priced below $1.00 per share. On executions that removed liquidity from EDGX qualified for tiered pricing E*TRADE was not charged a per share fee for executions priced at $1.00 per share or more or charged a per share fee for the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from EDGX in the amount of $189,519 in October, $171,462 in November, and $165,040 in December.
E*TRADE also participates in EDGX’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the EDGX retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on EDGX and may realize profits from orders it routes to EDGX for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
The Nasdaq Stock Market
1.72
0.00
0.04
5.05
0.58
0.00
0.0000
-20326.14
-27.7377
137408.31
26.4814
-1776.59
-25.1180
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to the Nasdaq Stock Market. (“NASDAQ”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under NASDAQ’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because NASDAQ offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to NASDAQ rather than another venue in order to reach a higher tier. E*TRADE and NASDAQ do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the NASDAQ Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to NASDAQ.
The fees E*TRADE pays and rebates E*TRADE receives from NASDAQ for NMS equity executions are determined based on NASDAQ’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by NASDAQ in the NASDAQ Fees Schedule, available at http://www.nasdaqtrader.com/trader.aspx?id=bx_pricing. Please note that NASDAQ’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, NASDAQ paid E*TRADE standard rebate rates of $0.00325 per share for executions priced at $1.00 per share or more and no per share charge for executions priced below $1.00 per share. Executions that removed liquidity from NASDAQ qualified for tiered pricing and E*TRADE was charged fees of $0.003 per share for executions priced at $1.00 per share or more and 0.30% of the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from NASDAQ in the amount of $138,653 in October, $130,586 in November, and $117,546 in December.
E*TRADE also participates in NASDAQ’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the NASDAQ retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on NASDAQ and may realize profits from orders it routes to NASDAQ for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
99.95
17.00
7.49
38.64
36.87
CITADEL SECURITIES LLC
35.82
37.91
37.85
37.95
32.20
2485447.78
46.6040
2210135.81
47.0002
2073999.31
45.8643
1240029.04
36.8844
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
E*TRADE does not receive remuneration from Citadel for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with Citadel passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index executions of $339,462 in October, $278,750 in November, and $311,071 in December.
There is a potential conflict inherent to an options market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Citadel does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Global Execution Brokers LP
24.48
22.98
22.89
22.87
27.20
598316.66
45.4185
827040.33
45.6097
1481884.24
45.7518
2372158.45
41.8706
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Global Execution Brokers LP (“SIG”) to facilitate liquidity provision and price improvement opportunities for its customers. SIG generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from SIG in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and SIG do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to SIG.
E*TRADE does not receive remuneration from SIG for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with SIG passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $273,758 in October, $239,104 in November, and $243,090 in December.
There is a potential conflict inherent to an options market maker such as SIG both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as SIG can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as SIG’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that SIG may collect for executing or facilitating the execution of E*TRADE customer orders, SIG may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize SIG to route higher percentages of E*TRADE customer orders to particular venues over others, subject to SIG’s independent order routing and best execution obligations. Exchange rebates provided to SIG for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. SIG does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although SIG’s receipt of such rebates potentially increases SIG’s revenue and thereby the source of funds SIG may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
DASH/IMC
19.75
20.95
20.96
20.83
17.82
1476325.35
47.1378
1065129.01
47.0673
1134091.34
46.3588
1178765.35
39.2470
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Dash Financial Technologies, LLC (“Dash”) to facilitate liquidity provision and price improvement opportunities for its customers. Dash generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Dash (based upon the remuneration Dash receives from the liquidity providers with which it has arrangements as described below) in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Dash do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Dash.
E*TRADE does not receive remuneration from Dash for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract depending on the index option class and premium price, with Dash passing exchange fees for index option executions to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $162,875 in October, $109,785 in November, and $133,327 in December.
In connection with Dash’s handling of E*TRADE retail equity option orders, Dash has arrangements with multiple, unaffiliated liquidity providers, including IMC Execution Services LLC, designed to facilitate liquidity provision and price improvement opportunities. Pursuant to these arrangements, Dash routes E*TRADE retail equity options orders to exchanges and may preference the liquidity providers on such applicable exchange, consistent with exchange-sponsored programs which are described in the fee schedules of each such options exchange. The liquidity providers provide Dash with remuneration in connection with Dash’s routing of E*TRADE retail equity options orders, including through reciprocal order flow arrangements between Dash and such liquidity provider and/or payment per contract to Dash in return for E*TRADE retail equity options orders that Dash routes or directs. Dash provides remuneration to E*TRADE as described above based upon the compensation Dash receives from such liquidity providers.
There is a potential conflict inherent to Dash and/or the liquidity provider to which Dash routes orders both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the liquidity provider seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, the liquidity provider can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay Dash (and for Dash, in turn, to pay E*TRADE) for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. The liquidity provider’s anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories. Dash and the liquidity provider can also adjust the amount of such profit that the liquidity provider shares with Dash.
In addition to revenues that Dash may collect for executing or facilitating the execution of E*TRADE customer orders, Dash may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Dash to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Dash’s independent order routing and best execution obligations. Exchange rebates provided to Dash for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Dash and/or its liquidity provider does not pass through the fees charged by the U.S. options exchanges for E*TRADE customer executions, other than the index options fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Dash’s and/or its liquidity provider’s receipt of such rebates potentially increases Dash’s and/or its liquidity provider’s revenue and thereby the source of funds that may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Wolverine Execution Services, LLC
18.91
17.16
17.23
17.33
21.70
1154373.17
47.9216
960427.00
47.9186
1035136.15
47.8700
1557548.26
48.1823
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Wolverine Execution Services, LLC (“Wolverine”) to facilitate liquidity provision and price improvement opportunities for its customers. Wolverine generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Wolverine in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Wolverine do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Wolverine.
E*TRADE does not receive remuneration from Wolverine for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with Wolverine passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $356,701 in October, $463,160 in November, and $525,720 in December.
There is a potential conflict inherent to an options market maker such as Wolverine both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as Wolverine can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as Wolverine’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Wolverine may collect for executing or facilitating the execution of E*TRADE customer orders, Wolverine may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Wolverine to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Wolverine’s independent order routing and best execution obligations. Exchange rebates provided to Wolverine for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Wolverine does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Wolverine’s receipt of such rebates potentially increases Wolverine’s revenue and thereby the source of funds Wolverine may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Matrix Executions, LLC / Simplex Trading, LLC
0.98
1.00
1.04
0.96
0.98
209.76
47.7813
56185.92
47.5680
138189.60
47.2697
44460.48
40.8652
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Matrix Executions LLC (“Matrix”) to facilitate liquidity provision and price improvement opportunities for its customers. Matrix generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Matrix (based upon the remuneration Matrix receives from the liquidity providers with which it has arrangements as described below) in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Matrix do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Matrix.
E*TRADE does not receive remuneration from Matrix for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract depending on the index option class and premium price, with Matrix passing exchange fees for index option executions to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $9,992 in October, $9,744 in November, and $12,220 in December.
In connection with Matrix’s handling of E*TRADE retail equity option orders, Matrix has arrangements with multiple, unaffiliated liquidity providers, including Simplex Trading LLC, designed to facilitate liquidity provision and price improvement opportunities. Pursuant to these arrangements, Matrix routes E*TRADE retail equity options orders to exchanges and may preference the liquidity providers on such applicable exchange, consistent with exchange-sponsored programs which are described in the fee schedules of each such options exchange. The liquidity providers provide Matrix with remuneration in connection with Matrix’s routing of E*TRADE retail equity options orders, including through reciprocal order flow arrangements between Matrix and such liquidity provider and/or payment per contract to Matrix in return for E*TRADE retail equity options orders that Matrix routes or directs. Matrix provides remuneration to E*TRADE as described above based upon the compensation Matrix receives from such liquidity providers.
There is a potential conflict inherent to Matrix and/or the liquidity provider to which Matrix routes orders both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the liquidity provider seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, the liquidity provider can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay Matrix (and for Matrix, in turn, to pay E*TRADE) for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. The liquidity provider’s anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories. Matrix and the liquidity provider can also adjust the amount of such profit that the liquidity provider shares with Matrix.
In addition to revenues that Matrix may collect for executing or facilitating the execution of E*TRADE customer orders, Matrix may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Matrix to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Matrix’s independent order routing and best execution obligations. Exchange rebates provided to Matrix for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Matrix and/or its liquidity provider does not pass through the fees charged by the U.S. options exchanges for E*TRADE customer executions, other than the index options fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Matrix’s and/or its liquidity provider’s receipt of such rebates potentially increases Matrix’s and/or its liquidity provider’s revenue and thereby the source of funds that may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Morgan Stanley & Co., LLC
0.06
0.00
0.02
0.05
0.10
0.00
0.0000
0.00
0.0000
0.00
0.0000
-1145.46
-13.0284
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Morgan Stanley & Co. LLC (“Morgan Stanley”) to facilitate liquidity provision and price improvement opportunities for its customers. Morgan Stanley generates revenue from executing or facilitating the execution of E*TRADE customer orders. E*TRADE does not receive remuneration from Morgan Stanley for the orders it routes to Morgan Stanley and E*TRADE and Morgan Stanley do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Morgan Stanley.
E*TRADE does not receive remuneration from Morgan Stanley for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
Morgan Stanley may receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Morgan Stanley to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Morgan Stanley’s independent order routing and best execution obligations. Exchange rebates provided and fees changed to Morgan Stanley for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. However, E*TRADE is an affiliated company of Morgan Stanley, which is a Market Maker on various U.S. options exchanges and may realize profits from orders it routes for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley and E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
2021
11
99.54
53.76
5.59
30.52
10.13
CITADEL SECURITIES LLC
31.14
38.77
37.26
15.40
34.71
374312.16
20.0000
79501.30
18.7399
81286.82
27.1024
79135.74
14.7141
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Citadel for NMS equity executions priced below $1.00 per share. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
There is a potential conflict inherent to a market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Citadel receives for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
G1X Execution Services, LLC
19.68
17.04
16.91
26.05
16.05
146793.52
19.3863
30564.70
19.5044
128154.67
30.0073
38534.16
21.9320
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to G1X Execution Services, LLC (“G1X”) to facilitate liquidity provision and price improvement opportunities for its customers. G1X generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from G1X in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from G1X for NMS equity executions priced below $1.00 per share. E*TRADE and G1X do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to G1X.
There is a potential conflict inherent to a market maker such as G1X both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as G1X can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as G1X’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that G1X may collect for executing or facilitating the execution of E*TRADE customer orders, G1X also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize G1X to route higher percentages of E*TRADE customer orders to particular venues over others, subject to G1X’s independent order routing and best execution obligations. Exchange rebates provided to G1X for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates G1X receives for executions of E*TRADE customer orders, although G1X’s receipt of such rebates potentially increases G1X’s revenue and thereby the source of funds G1X may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Virtu Americas, LLC
19.43
23.16
20.75
11.30
23.41
228656.33
20.0000
43725.22
17.0676
45911.57
24.2338
44074.19
10.7673
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Virtu Americas, LLC (“Virtu”) to facilitate liquidity provision and price improvement opportunities for its customers. Virtu generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Virtu in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Virtu for NMS equity executions priced below $1.00 per share. E*TRADE and Virtu do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Virtu.
There is a potential conflict inherent to a market maker such as Virtu both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Virtu can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Virtu’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Virtu may collect for executing or facilitating the execution of E*TRADE customer orders, Virtu also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Virtu to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Virtu’s independent order routing and best execution obligations. Exchange rebates provided to Virtu for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Virtu receives for executions of E*TRADE customer orders, although Virtu’s receipt of such rebates potentially increases Virtu’s revenue and thereby the source of funds Virtu may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Two Sigma Securities, LLC
11.35
6.26
7.96
22.52
6.57
58190.81
19.2564
13320.20
16.9253
80149.44
26.0532
16655.70
20.7594
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Two Sigma Securities, LLC (“Two Sigma”) to facilitate liquidity provision and price improvement opportunities for its customers. Two Sigma generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Two Sigma in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Two Sigma for NMS equity executions priced below $1.00 per share. E*TRADE and Two Sigma do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Two Sigma.
There is a potential conflict inherent to a market maker such as Two Sigma both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Two Sigma can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Two Sigma’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Two Sigma may collect for executing or facilitating the execution of E*TRADE customer orders, Two Sigma also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Two Sigma to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Two Sigma’s independent order routing and best execution obligations. Exchange rebates provided to Two Sigma for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Two Sigma receives for executions of E*TRADE customer orders, although Two Sigma’s receipt of such rebates potentially increases Two Sigma’s revenue and thereby the source of funds Two Sigma may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
UBS Securities, LLC
7.68
4.22
6.24
12.16
13.41
32843.26
19.9238
15058.02
20.7481
44923.26
30.1775
18438.39
22.7519
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to UBS Securities, LLC (“UBS”) to facilitate liquidity provision and price improvement opportunities for its customers. UBS generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from UBS in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from UBS for NMS equity executions priced below $1.00 per share. E*TRADE and UBS do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to UBS.
There is a potential conflict inherent to a market maker such as UBS both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as UBS can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as UBS’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that UBS may collect for executing or facilitating the execution of E*TRADE customer orders, UBS also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize UBS to route higher percentages of E*TRADE customer orders to particular venues over others, subject to UBS’s independent order routing and best execution obligations. Exchange rebates provided to UBS for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates UBS receives for executions of E*TRADE customer orders, although UBS’s receipt of such rebates potentially increases UBS’s revenue and thereby the source of funds UBS may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Jane Street Capital
7.57
10.57
10.76
2.64
4.75
111485.73
20.0038
22269.74
20.0000
11772.40
30.7004
16859.46
20.2844
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Jane Street Capital (“Jane Street”) to facilitate liquidity provision and price improvement opportunities for its customers. Jane Street generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Jane Street in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Jane Street for NMS equity executions priced below $1.00 per share. E*TRADE and Jane Street do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Jane Street.
There is a potential conflict inherent to a market maker such as Jane Street both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Jane Street can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Jane Street’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Jane Street may collect for executing or facilitating the execution of E*TRADE customer orders, Jane Street also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Jane Street to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Jane Street’s independent order routing and best execution obligations. Exchange rebates provided to Jane Street for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Jane Street receives for executions of E*TRADE customer orders, although Jane Street’s receipt of such rebates potentially increases Jane Street’s revenue and thereby the source of funds Jane Street may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
The Nasdaq Stock Market
1.60
0.00
0.05
5.10
0.42
0.00
0.0000
-899.50
-28.4080
22849.64
32.2311
-397.32
-27.1994
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-maE*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to the Nasdaq Stock Market. (“NASDAQ”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under NASDAQ’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because NASDAQ offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to NASDAQ rather than another venue in order to reach a higher tier. E*TRADE and NASDAQ do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the NASDAQ Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to NASDAQ.
The fees E*TRADE pays and rebates E*TRADE receives from NASDAQ for NMS equity executions are determined based on NASDAQ’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by NASDAQ in the NASDAQ Fees Schedule, available at http://www.nasdaqtrader.com/trader.aspx?id=bx_pricing. Please note that NASDAQ’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, NASDAQ paid E*TRADE standard rebate rates of $0.00325 per share for executions priced at $1.00 per share or more and no per share charge for executions priced below $1.00 per share. Executions that removed liquidity from NASDAQ qualified for tiered pricing and E*TRADE was charged fees of $0.003 per share for executions priced at $1.00 per share or more and 0.30% of the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from NASDAQ in the amount of $138,653 in October, $130,586 in November, and $117,546 in December.
E*TRADE also participates in NASDAQ’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the NASDAQ retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on NASDAQ and may realize profits from orders it routes to NASDAQ for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
Cboe EDGX Exchange, Inc.
1.54
0.00
0.07
4.82
0.68
0.00
0.0000
-11.58
-3.3413
25447.87
31.5219
0.00
0.0000
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to Cboe EDGX Exchange, Inc. (“EDGX”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under EDGX’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because EDGX offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to EDGX rather than another venue in order to reach a higher tier. E*TRADE and EDGX do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the EDGX Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to EDGX.
The fees E*TRADE pays and rebates E*TRADE receives from EDGX for NMS equity executions are determined based on EDGX’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by EDGX in the EDGX Fees Schedule, available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/. Please note that EDGX’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, EDGX paid E*TRADE standard rebate rates of $0.0032 per share for executions priced at $1.00 per share or more and $0.003 per share for executions priced below $1.00 per share. On executions that removed liquidity from EDGX qualified for tiered pricing E*TRADE was not charged a per share fee for executions priced at $1.00 per share or more or charged a per share fee for the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from EDGX in the amount of $189,519 in October, $171,462 in November, and $165,040 in December.
E*TRADE also participates in EDGX’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the EDGX retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on EDGX and may realize profits from orders it routes to EDGX for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
99.14
48.05
10.18
32.52
9.25
CITADEL SECURITIES LLC
30.80
38.84
38.20
15.57
34.37
1956716.44
18.0116
1021212.93
11.6467
426446.93
20.1245
278261.56
6.6777
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Citadel for NMS equity executions priced below $1.00 per share. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
There is a potential conflict inherent to a market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Citadel receives for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Virtu Americas, LLC
19.22
23.18
21.93
11.36
23.30
1240308.28
17.7960
561554.03
11.2339
237352.72
18.3425
128235.16
2.9199
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Virtu Americas, LLC (“Virtu”) to facilitate liquidity provision and price improvement opportunities for its customers. Virtu generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Virtu in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Virtu for NMS equity executions priced below $1.00 per share. E*TRADE and Virtu do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Virtu.
There is a potential conflict inherent to a market maker such as Virtu both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Virtu can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Virtu’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Virtu may collect for executing or facilitating the execution of E*TRADE customer orders, Virtu also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Virtu to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Virtu’s independent order routing and best execution obligations. Exchange rebates provided to Virtu for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Virtu receives for executions of E*TRADE customer orders, although Virtu’s receipt of such rebates potentially increases Virtu’s revenue and thereby the source of funds Virtu may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
G1X Execution Services, LLC
19.16
16.45
15.99
25.21
15.47
833101.51
17.4974
395071.12
12.8359
778632.38
24.9561
167740.06
20.6807
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to G1X Execution Services, LLC (“G1X”) to facilitate liquidity provision and price improvement opportunities for its customers. G1X generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from G1X in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from G1X for NMS equity executions priced below $1.00 per share. E*TRADE and G1X do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to G1X.
There is a potential conflict inherent to a market maker such as G1X both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as G1X can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as G1X’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that G1X may collect for executing or facilitating the execution of E*TRADE customer orders, G1X also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize G1X to route higher percentages of E*TRADE customer orders to particular venues over others, subject to G1X’s independent order routing and best execution obligations. Exchange rebates provided to G1X for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates G1X receives for executions of E*TRADE customer orders, although G1X’s receipt of such rebates potentially increases G1X’s revenue and thereby the source of funds G1X may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Two Sigma Securities, LLC
11.76
6.35
7.36
22.49
6.93
314520.14
17.4125
163816.32
11.7356
437522.43
21.4251
56525.31
19.2230
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Two Sigma Securities, LLC (“Two Sigma”) to facilitate liquidity provision and price improvement opportunities for its customers. Two Sigma generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Two Sigma in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Two Sigma for NMS equity executions priced below $1.00 per share. E*TRADE and Two Sigma do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Two Sigma.
There is a potential conflict inherent to a market maker such as Two Sigma both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Two Sigma can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Two Sigma’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Two Sigma may collect for executing or facilitating the execution of E*TRADE customer orders, Two Sigma also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Two Sigma to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Two Sigma’s independent order routing and best execution obligations. Exchange rebates provided to Two Sigma for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Two Sigma receives for executions of E*TRADE customer orders, although Two Sigma’s receipt of such rebates potentially increases Two Sigma’s revenue and thereby the source of funds Two Sigma may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
UBS Securities, LLC
8.01
4.24
5.44
12.54
14.47
174569.76
17.9676
136895.67
14.8126
253078.92
25.2609
88432.85
19.8543
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to UBS Securities, LLC (“UBS”) to facilitate liquidity provision and price improvement opportunities for its customers. UBS generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from UBS in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from UBS for NMS equity executions priced below $1.00 per share. E*TRADE and UBS do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to UBS.
There is a potential conflict inherent to a market maker such as UBS both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as UBS can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as UBS’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that UBS may collect for executing or facilitating the execution of E*TRADE customer orders, UBS also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize UBS to route higher percentages of E*TRADE customer orders to particular venues over others, subject to UBS’s independent order routing and best execution obligations. Exchange rebates provided to UBS for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates UBS receives for executions of E*TRADE customer orders, although UBS’s receipt of such rebates potentially increases UBS’s revenue and thereby the source of funds UBS may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Jane Street Capital
7.60
10.93
10.97
2.63
4.13
578750.58
18.0200
290524.37
12.0879
61602.34
24.2846
43513.29
18.8377
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Jane Street Capital (“Jane Street”) to facilitate liquidity provision and price improvement opportunities for its customers. Jane Street generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Jane Street in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Jane Street for NMS equity executions priced below $1.00 per share. E*TRADE and Jane Street do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Jane Street.
There is a potential conflict inherent to a market maker such as Jane Street both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Jane Street can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Jane Street’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Jane Street may collect for executing or facilitating the execution of E*TRADE customer orders, Jane Street also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Jane Street to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Jane Street’s independent order routing and best execution obligations. Exchange rebates provided to Jane Street for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Jane Street receives for executions of E*TRADE customer orders, although Jane Street’s receipt of such rebates potentially increases Jane Street’s revenue and thereby the source of funds Jane Street may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Cboe EDGX Exchange, Inc.
1.74
0.00
0.04
5.12
0.80
0.00
0.0000
131.19
3.2985
146500.81
26.5653
0.00
0.0000
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to Cboe EDGX Exchange, Inc. (“EDGX”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under EDGX’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because EDGX offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to EDGX rather than another venue in order to reach a higher tier. E*TRADE and EDGX do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the EDGX Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to EDGX.
The fees E*TRADE pays and rebates E*TRADE receives from EDGX for NMS equity executions are determined based on EDGX’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by EDGX in the EDGX Fees Schedule, available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/. Please note that EDGX’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, EDGX paid E*TRADE standard rebate rates of $0.0032 per share for executions priced at $1.00 per share or more and $0.003 per share for executions priced below $1.00 per share. On executions that removed liquidity from EDGX qualified for tiered pricing E*TRADE was not charged a per share fee for executions priced at $1.00 per share or more or charged a per share fee for the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from EDGX in the amount of $189,519 in October, $171,462 in November, and $165,040 in December.
E*TRADE also participates in EDGX’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the EDGX retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on EDGX and may realize profits from orders it routes to EDGX for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
The Nasdaq Stock Market
1.71
0.00
0.06
5.09
0.53
0.00
0.0000
-17667.64
-27.4962
124150.76
25.8528
-1284.73
-24.0306
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to the Nasdaq Stock Market. (“NASDAQ”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under NASDAQ’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because NASDAQ offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to NASDAQ rather than another venue in order to reach a higher tier. E*TRADE and NASDAQ do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the NASDAQ Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to NASDAQ.
The fees E*TRADE pays and rebates E*TRADE receives from NASDAQ for NMS equity executions are determined based on NASDAQ’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by NASDAQ in the NASDAQ Fees Schedule, available at http://www.nasdaqtrader.com/trader.aspx?id=bx_pricing. Please note that NASDAQ’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, NASDAQ paid E*TRADE standard rebate rates of $0.00325 per share for executions priced at $1.00 per share or more and no per share charge for executions priced below $1.00 per share. Executions that removed liquidity from NASDAQ qualified for tiered pricing and E*TRADE was charged fees of $0.003 per share for executions priced at $1.00 per share or more and 0.30% of the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from NASDAQ in the amount of $138,653 in October, $130,586 in November, and $117,546 in December.
E*TRADE also participates in NASDAQ’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the NASDAQ retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on NASDAQ and may realize profits from orders it routes to NASDAQ for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
99.96
18.08
7.22
39.93
34.76
CITADEL SECURITIES LLC
36.01
38.05
37.90
38.06
32.20
2850397.72
45.5975
2280225.57
45.9837
2485110.44
46.1384
1304955.93
36.7131
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
E*TRADE does not receive remuneration from Citadel for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with Citadel passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index executions of $339,462 in October, $278,750 in November, and $311,071 in December.
There is a potential conflict inherent to an options market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Citadel does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Global Execution Brokers LP
23.97
23.01
22.90
22.88
25.95
610684.48
43.4485
861618.41
44.0168
1723328.43
46.0150
2660582.25
43.3870
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Global Execution Brokers LP (“SIG”) to facilitate liquidity provision and price improvement opportunities for its customers. SIG generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from SIG in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and SIG do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to SIG.
E*TRADE does not receive remuneration from SIG for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with SIG passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $273,758 in October, $239,104 in November, and $243,090 in December.
There is a potential conflict inherent to an options market maker such as SIG both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as SIG can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as SIG’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that SIG may collect for executing or facilitating the execution of E*TRADE customer orders, SIG may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize SIG to route higher percentages of E*TRADE customer orders to particular venues over others, subject to SIG’s independent order routing and best execution obligations. Exchange rebates provided to SIG for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. SIG does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although SIG’s receipt of such rebates potentially increases SIG’s revenue and thereby the source of funds SIG may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
DASH/IMC
20.47
22.06
21.91
21.91
17.67
1465451.72
46.7684
945017.68
46.6332
1136130.53
46.9916
1079824.05
41.8828
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Dash Financial Technologies, LLC (“Dash”) to facilitate liquidity provision and price improvement opportunities for its customers. Dash generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Dash (based upon the remuneration Dash receives from the liquidity providers with which it has arrangements as described below) in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Dash do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Dash.
E*TRADE does not receive remuneration from Dash for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract depending on the index option class and premium price, with Dash passing exchange fees for index option executions to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $162,875 in October, $109,785 in November, and $133,327 in December.
In connection with Dash’s handling of E*TRADE retail equity option orders, Dash has arrangements with multiple, unaffiliated liquidity providers, including IMC Execution Services LLC, designed to facilitate liquidity provision and price improvement opportunities. Pursuant to these arrangements, Dash routes E*TRADE retail equity options orders to exchanges and may preference the liquidity providers on such applicable exchange, consistent with exchange-sponsored programs which are described in the fee schedules of each such options exchange. The liquidity providers provide Dash with remuneration in connection with Dash’s routing of E*TRADE retail equity options orders, including through reciprocal order flow arrangements between Dash and such liquidity provider and/or payment per contract to Dash in return for E*TRADE retail equity options orders that Dash routes or directs. Dash provides remuneration to E*TRADE as described above based upon the compensation Dash receives from such liquidity providers.
There is a potential conflict inherent to Dash and/or the liquidity provider to which Dash routes orders both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the liquidity provider seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, the liquidity provider can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay Dash (and for Dash, in turn, to pay E*TRADE) for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. The liquidity provider’s anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories. Dash and the liquidity provider can also adjust the amount of such profit that the liquidity provider shares with Dash.
In addition to revenues that Dash may collect for executing or facilitating the execution of E*TRADE customer orders, Dash may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Dash to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Dash’s independent order routing and best execution obligations. Exchange rebates provided to Dash for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Dash and/or its liquidity provider does not pass through the fees charged by the U.S. options exchanges for E*TRADE customer executions, other than the index options fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Dash’s and/or its liquidity provider’s receipt of such rebates potentially increases Dash’s and/or its liquidity provider’s revenue and thereby the source of funds that may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Wolverine Execution Services, LLC
18.53
15.90
16.25
16.13
23.12
1235586.72
47.9380
942135.57
47.9619
1113737.84
47.8127
1730953.09
48.1253
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Wolverine Execution Services, LLC (“Wolverine”) to facilitate liquidity provision and price improvement opportunities for its customers. Wolverine generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Wolverine in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Wolverine do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Wolverine.
E*TRADE does not receive remuneration from Wolverine for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with Wolverine passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $356,701 in October, $463,160 in November, and $525,720 in December.
There is a potential conflict inherent to an options market maker such as Wolverine both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as Wolverine can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as Wolverine’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Wolverine may collect for executing or facilitating the execution of E*TRADE customer orders, Wolverine may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Wolverine to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Wolverine’s independent order routing and best execution obligations. Exchange rebates provided to Wolverine for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Wolverine does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Wolverine’s receipt of such rebates potentially increases Wolverine’s revenue and thereby the source of funds Wolverine may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Matrix Executions, LLC / Simplex Trading, LLC
0.96
0.98
1.02
0.94
0.96
1128.48
46.3632
70623.84
47.1423
147167.50
46.7696
48743.52
41.5376
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Matrix Executions LLC (“Matrix”) to facilitate liquidity provision and price improvement opportunities for its customers. Matrix generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Matrix (based upon the remuneration Matrix receives from the liquidity providers with which it has arrangements as described below) in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Matrix do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Matrix.
E*TRADE does not receive remuneration from Matrix for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract depending on the index option class and premium price, with Matrix passing exchange fees for index option executions to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $9,992 in October, $9,744 in November, and $12,220 in December.
In connection with Matrix’s handling of E*TRADE retail equity option orders, Matrix has arrangements with multiple, unaffiliated liquidity providers, including Simplex Trading LLC, designed to facilitate liquidity provision and price improvement opportunities. Pursuant to these arrangements, Matrix routes E*TRADE retail equity options orders to exchanges and may preference the liquidity providers on such applicable exchange, consistent with exchange-sponsored programs which are described in the fee schedules of each such options exchange. The liquidity providers provide Matrix with remuneration in connection with Matrix’s routing of E*TRADE retail equity options orders, including through reciprocal order flow arrangements between Matrix and such liquidity provider and/or payment per contract to Matrix in return for E*TRADE retail equity options orders that Matrix routes or directs. Matrix provides remuneration to E*TRADE as described above based upon the compensation Matrix receives from such liquidity providers.
There is a potential conflict inherent to Matrix and/or the liquidity provider to which Matrix routes orders both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the liquidity provider seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, the liquidity provider can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay Matrix (and for Matrix, in turn, to pay E*TRADE) for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. The liquidity provider’s anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories. Matrix and the liquidity provider can also adjust the amount of such profit that the liquidity provider shares with Matrix.
In addition to revenues that Matrix may collect for executing or facilitating the execution of E*TRADE customer orders, Matrix may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Matrix to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Matrix’s independent order routing and best execution obligations. Exchange rebates provided to Matrix for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Matrix and/or its liquidity provider does not pass through the fees charged by the U.S. options exchanges for E*TRADE customer executions, other than the index options fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Matrix’s and/or its liquidity provider’s receipt of such rebates potentially increases Matrix’s and/or its liquidity provider’s revenue and thereby the source of funds that may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Morgan Stanley & Co., LLC
0.06
0.00
0.02
0.07
0.10
0.00
0.0000
0.00
0.0000
0.00
0.0000
-1576.16
-12.8331
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Morgan Stanley & Co. LLC (“Morgan Stanley”) to facilitate liquidity provision and price improvement opportunities for its customers. Morgan Stanley generates revenue from executing or facilitating the execution of E*TRADE customer orders. E*TRADE does not receive remuneration from Morgan Stanley for the orders it routes to Morgan Stanley and E*TRADE and Morgan Stanley do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Morgan Stanley.
E*TRADE does not receive remuneration from Morgan Stanley for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
Morgan Stanley may receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Morgan Stanley to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Morgan Stanley’s independent order routing and best execution obligations. Exchange rebates provided and fees changed to Morgan Stanley for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. However, E*TRADE is an affiliated company of Morgan Stanley, which is a Market Maker on various U.S. options exchanges and may realize profits from orders it routes for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley and E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
2021
12
99.58
52.59
5.43
31.31
10.67
CITADEL SECURITIES LLC
30.02
37.57
36.10
15.09
33.52
348310.30
20.0000
76019.72
19.2074
72541.45
26.8821
79837.28
15.7648
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Citadel for NMS equity executions priced below $1.00 per share. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
There is a potential conflict inherent to a market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Citadel receives for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
G1X Execution Services, LLC
20.87
18.21
18.24
27.11
16.99
161838.21
19.5675
33787.02
19.4279
114304.92
29.6230
41547.29
21.6858
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to G1X Execution Services, LLC (“G1X”) to facilitate liquidity provision and price improvement opportunities for its customers. G1X generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from G1X in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from G1X for NMS equity executions priced below $1.00 per share. E*TRADE and G1X do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to G1X.
There is a potential conflict inherent to a market maker such as G1X both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as G1X can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as G1X’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that G1X may collect for executing or facilitating the execution of E*TRADE customer orders, G1X also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize G1X to route higher percentages of E*TRADE customer orders to particular venues over others, subject to G1X’s independent order routing and best execution obligations. Exchange rebates provided to G1X for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates G1X receives for executions of E*TRADE customer orders, although G1X’s receipt of such rebates potentially increases G1X’s revenue and thereby the source of funds G1X may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Virtu Americas, LLC
18.34
21.84
19.67
10.95
22.10
208124.65
20.0000
40201.62
17.8699
44498.05
22.3156
41262.24
11.0165
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Virtu Americas, LLC (“Virtu”) to facilitate liquidity provision and price improvement opportunities for its customers. Virtu generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Virtu in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Virtu for NMS equity executions priced below $1.00 per share. E*TRADE and Virtu do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Virtu.
There is a potential conflict inherent to a market maker such as Virtu both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Virtu can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Virtu’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Virtu may collect for executing or facilitating the execution of E*TRADE customer orders, Virtu also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Virtu to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Virtu’s independent order routing and best execution obligations. Exchange rebates provided to Virtu for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Virtu receives for executions of E*TRADE customer orders, although Virtu’s receipt of such rebates potentially increases Virtu’s revenue and thereby the source of funds Virtu may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Two Sigma Securities, LLC
10.65
5.07
6.76
22.17
6.32
45257.75
19.2965
9610.04
16.6213
82534.08
27.5640
18056.69
23.0390
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Two Sigma Securities, LLC (“Two Sigma”) to facilitate liquidity provision and price improvement opportunities for its customers. Two Sigma generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Two Sigma in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Two Sigma for NMS equity executions priced below $1.00 per share. E*TRADE and Two Sigma do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Two Sigma.
There is a potential conflict inherent to a market maker such as Two Sigma both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Two Sigma can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Two Sigma’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Two Sigma may collect for executing or facilitating the execution of E*TRADE customer orders, Two Sigma also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Two Sigma to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Two Sigma’s independent order routing and best execution obligations. Exchange rebates provided to Two Sigma for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Two Sigma receives for executions of E*TRADE customer orders, although Two Sigma’s receipt of such rebates potentially increases Two Sigma’s revenue and thereby the source of funds Two Sigma may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Jane Street Capital
9.12
13.13
12.98
2.65
6.37
130104.93
20.0096
27486.97
20.0000
12846.89
30.7697
22072.34
20.2444
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Jane Street Capital (“Jane Street”) to facilitate liquidity provision and price improvement opportunities for its customers. Jane Street generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Jane Street in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Jane Street for NMS equity executions priced below $1.00 per share. E*TRADE and Jane Street do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Jane Street.
There is a potential conflict inherent to a market maker such as Jane Street both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Jane Street can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Jane Street’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Jane Street may collect for executing or facilitating the execution of E*TRADE customer orders, Jane Street also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Jane Street to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Jane Street’s independent order routing and best execution obligations. Exchange rebates provided to Jane Street for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Jane Street receives for executions of E*TRADE customer orders, although Jane Street’s receipt of such rebates potentially increases Jane Street’s revenue and thereby the source of funds Jane Street may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
UBS Securities, LLC
7.80
4.19
6.08
12.28
13.35
30941.85
19.9260
14389.30
20.7798
42694.41
30.2927
20552.70
22.6968
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to UBS Securities, LLC (“UBS”) to facilitate liquidity provision and price improvement opportunities for its customers. UBS generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from UBS in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from UBS for NMS equity executions priced below $1.00 per share. E*TRADE and UBS do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to UBS.
There is a potential conflict inherent to a market maker such as UBS both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as UBS can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as UBS’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that UBS may collect for executing or facilitating the execution of E*TRADE customer orders, UBS also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize UBS to route higher percentages of E*TRADE customer orders to particular venues over others, subject to UBS’s independent order routing and best execution obligations. Exchange rebates provided to UBS for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates UBS receives for executions of E*TRADE customer orders, although UBS’s receipt of such rebates potentially increases UBS’s revenue and thereby the source of funds UBS may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
The Nasdaq Stock Market
1.62
0.00
0.07
4.97
0.54
0.00
0.0000
-638.17
-28.7435
21513.88
32.2679
-198.87
-23.1220
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-maE*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to the Nasdaq Stock Market. (“NASDAQ”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under NASDAQ’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because NASDAQ offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to NASDAQ rather than another venue in order to reach a higher tier. E*TRADE and NASDAQ do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the NASDAQ Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to NASDAQ.
The fees E*TRADE pays and rebates E*TRADE receives from NASDAQ for NMS equity executions are determined based on NASDAQ’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by NASDAQ in the NASDAQ Fees Schedule, available at http://www.nasdaqtrader.com/trader.aspx?id=bx_pricing. Please note that NASDAQ’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, NASDAQ paid E*TRADE standard rebate rates of $0.00325 per share for executions priced at $1.00 per share or more and no per share charge for executions priced below $1.00 per share. Executions that removed liquidity from NASDAQ qualified for tiered pricing and E*TRADE was charged fees of $0.003 per share for executions priced at $1.00 per share or more and 0.30% of the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from NASDAQ in the amount of $138,653 in October, $130,586 in November, and $117,546 in December.
E*TRADE also participates in NASDAQ’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the NASDAQ retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on NASDAQ and may realize profits from orders it routes to NASDAQ for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
Cboe EDGX Exchange, Inc.
1.59
0.00
0.10
4.78
0.82
0.00
0.0000
-29.10
-5.0447
27681.52
31.4187
0.00
0.0000
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to Cboe EDGX Exchange, Inc. (“EDGX”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under EDGX’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because EDGX offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to EDGX rather than another venue in order to reach a higher tier. E*TRADE and EDGX do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the EDGX Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to EDGX.
The fees E*TRADE pays and rebates E*TRADE receives from EDGX for NMS equity executions are determined based on EDGX’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by EDGX in the EDGX Fees Schedule, available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/. Please note that EDGX’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, EDGX paid E*TRADE standard rebate rates of $0.0032 per share for executions priced at $1.00 per share or more and $0.003 per share for executions priced below $1.00 per share. On executions that removed liquidity from EDGX qualified for tiered pricing E*TRADE was not charged a per share fee for executions priced at $1.00 per share or more or charged a per share fee for the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from EDGX in the amount of $189,519 in October, $171,462 in November, and $165,040 in December.
E*TRADE also participates in EDGX’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the EDGX retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on EDGX and may realize profits from orders it routes to EDGX for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
99.31
46.78
10.25
33.37
9.60
CITADEL SECURITIES LLC
29.64
37.52
36.87
15.32
33.34
1684430.66
17.8462
816589.52
11.4960
374730.05
21.8186
248290.92
8.2853
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Citadel for NMS equity executions priced below $1.00 per share. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
There is a potential conflict inherent to a market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Citadel receives for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
G1X Execution Services, LLC
20.25
17.75
17.34
25.76
16.38
773496.39
17.4257
364775.01
12.2462
644125.10
25.4661
172525.59
21.3956
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to G1X Execution Services, LLC (“G1X”) to facilitate liquidity provision and price improvement opportunities for its customers. G1X generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from G1X in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from G1X for NMS equity executions priced below $1.00 per share. E*TRADE and G1X do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to G1X.
There is a potential conflict inherent to a market maker such as G1X both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as G1X can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as G1X’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that G1X may collect for executing or facilitating the execution of E*TRADE customer orders, G1X also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize G1X to route higher percentages of E*TRADE customer orders to particular venues over others, subject to G1X’s independent order routing and best execution obligations. Exchange rebates provided to G1X for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates G1X receives for executions of E*TRADE customer orders, although G1X’s receipt of such rebates potentially increases G1X’s revenue and thereby the source of funds G1X may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Virtu Americas, LLC
18.31
22.03
20.80
11.25
22.08
1062845.92
17.7979
461436.27
11.9693
209084.28
19.3360
119932.10
3.7815
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Virtu Americas, LLC (“Virtu”) to facilitate liquidity provision and price improvement opportunities for its customers. Virtu generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Virtu in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Virtu for NMS equity executions priced below $1.00 per share. E*TRADE and Virtu do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Virtu.
There is a potential conflict inherent to a market maker such as Virtu both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Virtu can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Virtu’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Virtu may collect for executing or facilitating the execution of E*TRADE customer orders, Virtu also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Virtu to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Virtu’s independent order routing and best execution obligations. Exchange rebates provided to Virtu for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Virtu receives for executions of E*TRADE customer orders, although Virtu’s receipt of such rebates potentially increases Virtu’s revenue and thereby the source of funds Virtu may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Two Sigma Securities, LLC
11.18
5.12
6.17
22.49
6.72
222601.89
17.3474
110570.86
11.2478
412737.44
23.4471
52205.47
20.2931
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Two Sigma Securities, LLC (“Two Sigma”) to facilitate liquidity provision and price improvement opportunities for its customers. Two Sigma generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Two Sigma in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Two Sigma for NMS equity executions priced below $1.00 per share. E*TRADE and Two Sigma do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Two Sigma.
There is a potential conflict inherent to a market maker such as Two Sigma both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Two Sigma can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Two Sigma’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Two Sigma may collect for executing or facilitating the execution of E*TRADE customer orders, Two Sigma also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Two Sigma to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Two Sigma’s independent order routing and best execution obligations. Exchange rebates provided to Two Sigma for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Two Sigma receives for executions of E*TRADE customer orders, although Two Sigma’s receipt of such rebates potentially increases Two Sigma’s revenue and thereby the source of funds Two Sigma may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Jane Street Capital
9.06
13.32
13.45
2.65
5.92
634138.24
17.6432
302889.31
12.3980
59312.52
26.0255
52089.99
18.3883
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to Jane Street Capital (“Jane Street”) to facilitate liquidity provision and price improvement opportunities for its customers. Jane Street generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Jane Street in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from Jane Street for NMS equity executions priced below $1.00 per share. E*TRADE and Jane Street do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Jane Street.
There is a potential conflict inherent to a market maker such as Jane Street both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as Jane Street can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as Jane Street’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Jane Street may collect for executing or facilitating the execution of E*TRADE customer orders, Jane Street also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize Jane Street to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Jane Street’s independent order routing and best execution obligations. Exchange rebates provided to Jane Street for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates Jane Street receives for executions of E*TRADE customer orders, although Jane Street’s receipt of such rebates potentially increases Jane Street’s revenue and thereby the source of funds Jane Street may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
UBS Securities, LLC
8.06
4.25
5.27
12.53
14.10
153910.42
17.8565
117267.63
15.0161
223226.79
25.8767
81663.85
20.7198
E*TRADE Securities LLC (“E*TRADE”) routes NMS equity orders to UBS Securities, LLC (“UBS”) to facilitate liquidity provision and price improvement opportunities for its customers. UBS generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from UBS in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.002 per share for non-directed, NMS equity market and marketable limit order executions priced at $1.00 per share or more and $0.0031 per share for non-directed, NMS equity non-marketable limit order executions priced at $1.00 per share or more. E*TRADE does not receive remuneration from UBS for NMS equity executions priced below $1.00 per share. E*TRADE and UBS do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to UBS.
There is a potential conflict inherent to a market maker such as UBS both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, a market maker such as UBS can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. A market maker’s (such as UBS’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that UBS may collect for executing or facilitating the execution of E*TRADE customer orders, UBS also receives remuneration from U.S. securities exchanges to which it routes or directs E*TRADE customer orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. exchange rebate payments could, in theory, incentivize UBS to route higher percentages of E*TRADE customer orders to particular venues over others, subject to UBS’s independent order routing and best execution obligations. Exchange rebates provided to UBS for E*TRADE customer executions are not passed through to E*TRADE or its customers. E*TRADE does not share directly in any such rebates UBS receives for executions of E*TRADE customer orders, although UBS’s receipt of such rebates potentially increases UBS’s revenue and thereby the source of funds UBS may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Cboe EDGX Exchange, Inc.
1.76
0.00
0.05
5.02
0.85
0.00
0.0000
46.11
1.4743
126133.29
27.3905
0.00
0.0000
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to Cboe EDGX Exchange, Inc. (“EDGX”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under EDGX’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because EDGX offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to EDGX rather than another venue in order to reach a higher tier. E*TRADE and EDGX do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the EDGX Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to EDGX.
The fees E*TRADE pays and rebates E*TRADE receives from EDGX for NMS equity executions are determined based on EDGX’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by EDGX in the EDGX Fees Schedule, available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/. Please note that EDGX’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, EDGX paid E*TRADE standard rebate rates of $0.0032 per share for executions priced at $1.00 per share or more and $0.003 per share for executions priced below $1.00 per share. On executions that removed liquidity from EDGX qualified for tiered pricing E*TRADE was not charged a per share fee for executions priced at $1.00 per share or more or charged a per share fee for the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from EDGX in the amount of $189,519 in October, $171,462 in November, and $165,040 in December.
E*TRADE also participates in EDGX’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the EDGX retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on EDGX and may realize profits from orders it routes to EDGX for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
The Nasdaq Stock Market
1.73
0.00
0.05
4.98
0.61
0.00
0.0000
-11775.92
-28.2529
102749.06
26.3730
-906.39
-23.1189
E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable E*TRADE Securities LLC (“E*TRADE”) routes marketable and non-marketable NMS equity limit orders to the Nasdaq Stock Market. (“NASDAQ”) as specified in the above Public Order Routing Report disclosures. E*TRADE either pays a fee or receives a rebate for each E*TRADE customer order execution on the exchange, depending on whether the order added to or subtracted from liquidity on the exchange.
The fees and rebates referenced above are subject to volume pricing. To the extent that E*TRADE meets the execution volume thresholds necessary to qualify for preferred pricing under NASDAQ’s Fees Schedule in a given month, increased (rather than standard) rebate rates and decreased (rather than standard) fees will apply. Because NASDAQ offers higher rebates and lower fees based on a tiered volume model, there is a potential conflict in that such rebates and fees could, in theory, incentivize E*TRADE to route a higher percentages of E*TRADE customer orders to NASDAQ rather than another venue in order to reach a higher tier. E*TRADE and NASDAQ do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules beyond the tiered volume model set forth in the NASDAQ Fees Schedule as described above; or
D. that require E*TRADE to route any orders or a minimum number of orders to NASDAQ.
The fees E*TRADE pays and rebates E*TRADE receives from NASDAQ for NMS equity executions are determined based on NASDAQ’s tiered volume model. Schedules delineating orders eligible for such rebates and the applicable rates are published publicly by NASDAQ in the NASDAQ Fees Schedule, available at http://www.nasdaqtrader.com/trader.aspx?id=bx_pricing. Please note that NASDAQ’s publicly available Fees Schedule URL link and applicable rates may change without notice.
In general, during Q4 2021, NASDAQ paid E*TRADE standard rebate rates of $0.00325 per share for executions priced at $1.00 per share or more and no per share charge for executions priced below $1.00 per share. Executions that removed liquidity from NASDAQ qualified for tiered pricing and E*TRADE was charged fees of $0.003 per share for executions priced at $1.00 per share or more and 0.30% of the total notional value of executions priced below $1.00 per share. For Q4 2021, E*TRADE received rebates (net of fees) from NASDAQ in the amount of $138,653 in October, $130,586 in November, and $117,546 in December.
E*TRADE also participates in NASDAQ’s retail order priority program under which eligible retail orders receive priority ahead of other available interest at a given price level or other enhanced execution benefits. E*TRADE reviews customers’ activity on a periodic basis to determine program eligibility and reserves the right to choose whether to participate in the NASDAQ retail order priority program. E*TRADE is an affiliated company of Morgan Stanley & Co. LLC (“Morgan Stanley”), which is a Market Maker on NASDAQ and may realize profits from orders it routes to NASDAQ for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley. E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.
99.96
17.59
6.54
37.47
38.40
CITADEL SECURITIES LLC
35.75
37.96
37.84
37.98
32.20
2789718.10
46.7452
1975433.75
46.3671
2151542.28
45.7883
1276940.59
38.0799
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Citadel Securities LLC (“Citadel”) to facilitate liquidity provision and price improvement opportunities for its customers. Citadel generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Citadel in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Citadel do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Citadel.
E*TRADE does not receive remuneration from Citadel for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with Citadel passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index executions of $339,462 in October, $278,750 in November, and $311,071 in December.
There is a potential conflict inherent to an options market maker such as Citadel both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as Citadel can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as Citadel’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Citadel may collect for executing or facilitating the execution of E*TRADE customer orders, Citadel may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Citadel to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Citadel’s independent order routing and best execution obligations. Exchange rebates provided to Citadel for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Citadel does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Citadel’s receipt of such rebates potentially increases Citadel’s revenue and thereby the source of funds Citadel may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Global Execution Brokers LP
23.43
22.96
22.87
22.82
24.32
633162.97
45.5616
764020.19
45.4434
1521713.07
46.0358
2281674.07
42.8332
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Global Execution Brokers LP (“SIG”) to facilitate liquidity provision and price improvement opportunities for its customers. SIG generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from SIG in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and SIG do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to SIG.
E*TRADE does not receive remuneration from SIG for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with SIG passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $273,758 in October, $239,104 in November, and $243,090 in December.
There is a potential conflict inherent to an options market maker such as SIG both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as SIG can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as SIG’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that SIG may collect for executing or facilitating the execution of E*TRADE customer orders, SIG may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize SIG to route higher percentages of E*TRADE customer orders to particular venues over others, subject to SIG’s independent order routing and best execution obligations. Exchange rebates provided to SIG for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. SIG does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although SIG’s receipt of such rebates potentially increases SIG’s revenue and thereby the source of funds SIG may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
DASH/IMC
21.46
23.88
23.75
23.68
17.81
1878470.99
47.3102
1040108.64
47.0007
1439237.50
46.8191
1199299.56
40.8962
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Dash Financial Technologies, LLC (“Dash”) to facilitate liquidity provision and price improvement opportunities for its customers. Dash generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Dash (based upon the remuneration Dash receives from the liquidity providers with which it has arrangements as described below) in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Dash do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Dash.
E*TRADE does not receive remuneration from Dash for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract depending on the index option class and premium price, with Dash passing exchange fees for index option executions to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $162,875 in October, $109,785 in November, and $133,327 in December.
In connection with Dash’s handling of E*TRADE retail equity option orders, Dash has arrangements with multiple, unaffiliated liquidity providers, including IMC Execution Services LLC, designed to facilitate liquidity provision and price improvement opportunities. Pursuant to these arrangements, Dash routes E*TRADE retail equity options orders to exchanges and may preference the liquidity providers on such applicable exchange, consistent with exchange-sponsored programs which are described in the fee schedules of each such options exchange. The liquidity providers provide Dash with remuneration in connection with Dash’s routing of E*TRADE retail equity options orders, including through reciprocal order flow arrangements between Dash and such liquidity provider and/or payment per contract to Dash in return for E*TRADE retail equity options orders that Dash routes or directs. Dash provides remuneration to E*TRADE as described above based upon the compensation Dash receives from such liquidity providers.
There is a potential conflict inherent to Dash and/or the liquidity provider to which Dash routes orders both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the liquidity provider seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, the liquidity provider can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay Dash (and for Dash, in turn, to pay E*TRADE) for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. The liquidity provider’s anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories. Dash and the liquidity provider can also adjust the amount of such profit that the liquidity provider shares with Dash.
In addition to revenues that Dash may collect for executing or facilitating the execution of E*TRADE customer orders, Dash may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Dash to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Dash’s independent order routing and best execution obligations. Exchange rebates provided to Dash for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Dash and/or its liquidity provider does not pass through the fees charged by the U.S. options exchanges for E*TRADE customer executions, other than the index options fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Dash’s and/or its liquidity provider’s receipt of such rebates potentially increases Dash’s and/or its liquidity provider’s revenue and thereby the source of funds that may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Wolverine Execution Services, LLC
18.32
14.19
14.48
14.51
24.58
1059065.42
48.0232
715006.53
47.9177
898362.99
47.7701
1743724.03
48.4884
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Wolverine Execution Services, LLC (“Wolverine”) to facilitate liquidity provision and price improvement opportunities for its customers. Wolverine generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Wolverine in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Wolverine do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Wolverine.
E*TRADE does not receive remuneration from Wolverine for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract, depending on the index option class and premium price, with Wolverine passing exchange fees for index option executions back to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $356,701 in October, $463,160 in November, and $525,720 in December.
There is a potential conflict inherent to an options market maker such as Wolverine both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the options market maker seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, an options market maker such as Wolverine can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. An options market maker’s (such as Wolverine’s) anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories.
In addition to revenues that Wolverine may collect for executing or facilitating the execution of E*TRADE customer orders, Wolverine may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Wolverine to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Wolverine’s independent order routing and best execution obligations. Exchange rebates provided to Wolverine for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Wolverine does not pass through the fees that it is charged by the U.S. options exchanges for E*TRADE customer executions, other than the index option fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Wolverine’s receipt of such rebates potentially increases Wolverine’s revenue and thereby the source of funds Wolverine may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Matrix Executions, LLC / Simplex Trading, LLC
0.99
1.00
1.04
0.97
0.99
1592.16
47.9566
65299.68
47.5349
136890.20
47.0764
44879.04
40.0006
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Matrix Executions LLC (“Matrix”) to facilitate liquidity provision and price improvement opportunities for its customers. Matrix generates revenue from executing or facilitating the execution of E*TRADE customer orders. In exchange for such routing, E*TRADE receives remuneration from Matrix (based upon the remuneration Matrix receives from the liquidity providers with which it has arrangements as described below) in the amounts outlined in the above Public Order Routing Report disclosures, calculated at a rate of $0.48 per contract for simple and complex equity options orders. E*TRADE and Matrix do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Matrix.
E*TRADE does not receive remuneration from Matrix for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
In general, public, retail, or non-professional index options order execution fees range from $0.00 to $0.66 per contract depending on the index option class and premium price, with Matrix passing exchange fees for index option executions to E*TRADE each month. For Q4 2021, E*TRADE paid total fees on customer index option executions of $9,992 in October, $9,744 in November, and $12,220 in December.
In connection with Matrix’s handling of E*TRADE retail equity option orders, Matrix has arrangements with multiple, unaffiliated liquidity providers, including Simplex Trading LLC, designed to facilitate liquidity provision and price improvement opportunities. Pursuant to these arrangements, Matrix routes E*TRADE retail equity options orders to exchanges and may preference the liquidity providers on such applicable exchange, consistent with exchange-sponsored programs which are described in the fee schedules of each such options exchange. The liquidity providers provide Matrix with remuneration in connection with Matrix’s routing of E*TRADE retail equity options orders, including through reciprocal order flow arrangements between Matrix and such liquidity provider and/or payment per contract to Matrix in return for E*TRADE retail equity options orders that Matrix routes or directs. Matrix provides remuneration to E*TRADE as described above based upon the compensation Matrix receives from such liquidity providers.
There is a potential conflict inherent to Matrix and/or the liquidity provider to which Matrix routes orders both paying for order flow and providing price improvement, as the potential source of funds for each is the same, namely the anticipated profit the liquidity provider seeks to earn from executing or facilitating the execution of E*TRADE customer orders. Accordingly, from such anticipated profit, the liquidity provider can (i) forgo a portion of such anticipated profit to provide price improvement; (ii) forgo a portion of such anticipated profit to pay Matrix (and for Matrix, in turn, to pay E*TRADE) for order flow; or (iii) retain a larger portion of anticipated profit and not provide (or provide less) price improvement or not provide (or provide less) payment for order flow. The liquidity provider’s anticipated profit must be allocated among these three sub-categories, such that an increased allocation to any one sub-category will result in a decreased allocation to one or more of the other categories. Matrix and the liquidity provider can also adjust the amount of such profit that the liquidity provider shares with Matrix.
In addition to revenues that Matrix may collect for executing or facilitating the execution of E*TRADE customer orders, Matrix may also receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Matrix to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Matrix’s independent order routing and best execution obligations. Exchange rebates provided to Matrix for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. Matrix and/or its liquidity provider does not pass through the fees charged by the U.S. options exchanges for E*TRADE customer executions, other than the index options fees described above. E*TRADE does not share directly in any profits from U.S. options exchange rebates for executions of E*TRADE customer orders, although Matrix’s and/or its liquidity provider’s receipt of such rebates potentially increases Matrix’s and/or its liquidity provider’s revenue and thereby the source of funds that may use to provide price improvement to E*TRADE customers, order flow payment to E*TRADE, and/or a combination of such payments.
Morgan Stanley & Co., LLC
0.06
0.00
0.01
0.05
0.10
0.00
0.0000
0.00
0.0000
0.00
0.0000
-1376.07
-12.3226
E*TRADE Securities LLC (“E*TRADE”) routes U.S.-listed options orders to Morgan Stanley & Co. LLC (“Morgan Stanley”) to facilitate liquidity provision and price improvement opportunities for its customers. Morgan Stanley generates revenue from executing or facilitating the execution of E*TRADE customer orders. E*TRADE does not receive remuneration from Morgan Stanley for the orders it routes to Morgan Stanley and E*TRADE and Morgan Stanley do not have any arrangements:
A. that require E*TRADE to meet certain volume thresholds or that provide incentives to E*TRADE for meeting or exceeding certain volume thresholds;
B. that require E*TRADE to meet certain minimum volume thresholds or that provide disincentives to E*TRADE for failing to meet certain minimum volume thresholds;
C. for volume-based tiered payment schedules; or
D. that require E*TRADE to route any orders or a minimum number of orders to Morgan Stanley.
E*TRADE does not receive remuneration from Morgan Stanley for index options executions or for Professional Customer orders, which are orders of customers who submit an average of 390 options orders per trading day, per calendar month, on a quarterly basis.
Morgan Stanley may receive remuneration from the U.S. options exchanges to which it routes or directs E*TRADE customer options orders in the form of rebates. Although E*TRADE has no knowledge of any facts to suggest that such is the case, these U.S. options exchange rebate payments could, in theory, incentivize Morgan Stanley to route higher percentages of E*TRADE customer orders to particular venues over others, subject to Morgan Stanley’s independent order routing and best execution obligations. Exchange rebates provided and fees changed to Morgan Stanley for E*TRADE customer executions by the U.S. options exchanges are not passed through to E*TRADE or its customers. However, E*TRADE is an affiliated company of Morgan Stanley, which is a Market Maker on various U.S. options exchanges and may realize profits from orders it routes for execution. E*TRADE may share directly or indirectly in any such profits generated by Morgan Stanley and E*TRADE and Morgan Stanley order execution volumes are combined on a monthly basis for tiered pricing program incentive purposes.