The New York Stock Exchange is on an high-frequency trading war footing.
The struggling mart, in a frantic new bid to regain market share, is huddling with lawmakers and bringing in reinforcements.
The maneuvers include a speedier and more reliable NYSE “matching” platform for stock and options trading, industry sources say.
The bare-knuckles tactic, they add, is aimed squarely at luring back NYSE volume lost to rival high-frequency trading, or HFT, platforms.
It comes as New York state and federal regulators are ramping up investigations of whether some HFT firms are, in effect, high-speed robber barons — pocketing millions of dollars by front-running other investors’ orders.
This intense spotlight is giving the Big Board an unprecedented opening to level the playing field, industry sources say.
That’s on top of rising transaction outlays and public criticism of “rigged markets” that could promote the cause.
A new Credit Suisse study shows stock-transaction costs, after having declined for the previous six years, have been trending back up for the past two.
“The NYSE has had the worst order-matching engine of all the exchanges,“ Haim Bodek, a former Goldman Sachs and UBS trader turned industry whistle-blower, told The Post.
“HFT traders in general, and latency traders in general, tend to despise the NYSE Arca platform and tend to direct [orders] away from it,” Bodek added, referring to traders who shun the exchange’s system in favor of rivals’ that are microseconds faster.
Bodek famously went to the Securities and Exchange Commission in 2011, charging that exchanges were in cahoots with shady high-speed traders.
Today, he says, HFTs can’t stand hiccups and delays on limit orders associated with the Big Board’s current platform.
The time lag is expected to disappear with the purchase — by NYSE’s new owner, IntercontinentalExchange (ICE) — of Algo Technologies, which reputedly provides the Street’s fastest matching engine.
And it comes as ICE invests substantial sums elsewhere within the NYSE: The exchange is extensively refurbishing a section known as “The Garage.”
The new digs will be set aside for options pros (currently working in nearby rented space), with additional room for other traders.
The Big Board declined to comment.
Chris Nagy, an industry consultant and lobbyist at KOR Group, predicts the NYSE will emerge in better shape.
“I see them being the clear winners in lots of ways,” said Nagy, a former managing director at TD Ameritrade. “I think the stage is really set for the exchanges.”
The NYSE, once the dominant player in the $22 trillion US equity markets, had a 21.7 percent industrywide market share in March, according to the Tabb Group.
Rivals, such as secretive dark pools, have overtaken the more price-transparent Big Board with their complex processes.
“This is a catch-up mode,” Bodek said of the NYSE’s latest tech plans.