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Nasdaq Proposes Issuers Pay Market Makers in Less-Active ETFs

Nasdaq Stock Market asked the U.S. Securities and Exchange Commission to allow companies sponsoring exchange-traded funds to pay market makers about $200 per day to quote their shares more aggressively.

The practice, currently illegal in the U.S., would spur quoting and transactions in ETFs that trade less than 2 million shares daily, benefiting investors by making more volume available to buy or sell at better prices, Nasdaq told the SEC in a filing published on April 6. The exchange said it would begin the program, which regulators must approve before it can be implemented, as a one-year study. The SEC rejected two earlier requests before they reached the public comment stage.