Nasdaq to Start Ad Blitz About New SEC Rules

The Nasdaq Stock Market, chastened by criticism that it failed to protect small investors, is out to tell 55 million investors that it’s changed.

With a 15-second television ad blitz and newspaper ad campaign in the next four months--as well as an enhanced World Wide Web site--the nation’s second-largest stock market will be telling investors about the new rules the Securities and Exchange Commission approved last month.

The campaign’s purpose “is to be sure [small investors] understand what the SEC rules do for individual investors” to help them get better prices, Nasdaq President Alfred Berkeley said.

Nasdaq has been under pressure to make its screen-based market more accessible to individual investors since 1994, when the Justice Department and the SEC began investigating trading practices and whether its market makers colluded on prices.

Last month, the SEC approved rules requiring Nasdaq to let individual investors’ orders compete with those placed by dealers and institutional customers. The rules, which also require private trading systems such as Reuters’ Instinet to display prices on Nasdaq, are designed to narrow trading spreads and help small investors get better prices. The rules will be implemented in January.

The TV ads, which start Monday, don’t mention the new rules. They attempt to draw viewers to Nasdaq’s Web site, which contains a section on the changes. The newspaper ads include a toll-free number investors can call for a brochure about the new rules.