Securities Markets Flashcards
OATS
Order audit trail system - tracks life of order entered OTC both listed and unlisted
GTC
Good Till Cancelled - expired last day of April or October
NYSE and Nasdaq no longer allow
SEC act of 1934 regulates:
Exchanges
Margin
Registration
Price manipulation
Stop limit order
Combination of both stop and limit orders, a first, then process
ACT
Automated confirmation transaction system - verifies details of all ORC transactions After execution
Limit orders
Executed at specific price or better
Manning rule
Customer Limit order protection rule, must execute order w/in 60 seconds, fill customer orders upto as many shares executed for own acct
Stop orders
Used for protection, only available through OTC, triggers then executes immediately
Exchanges
Auction markets, centralized trading, trading floor
AON
All Or Nothing - entire order executed same time, same price
Cannot break it up
Secondary market
Exchange or OTC
4 categories: 1st mkt - listed, on an exchange 2nd mkt - unlisted, OTC 3rd mkt - listed, OTC 4th mkt - ECN
Market order
Buy or sell a security, immediately, at best price available
Consolidated tape
Reports trades of Listed securities on different markets
Includes exchanges mkt and 3rd & 4th mkt,
does not include primary mkt or options mkt or bonds
ALREADY EXECUTED
SEC rule 104 stabilization
UW can buyback at or below POP for stabilization, no time limit
Stopping stock
DMm guarantees price up to 2 minutes
FOK
Fill or Kill - entire order executed, same time, same price or cancelled
Cannot be broken up
ECN
Electronic communication network - 24 hrs, lower cost, more liquidity
BLiSS
Stretch
Inside market
Highest bid, lowest ask
Threshold security
Heavily borrowed, difficult to borrow
SEC rule 201 stock decline
10% stock decline - no more short selling the following day
SLoBS
Stretch
Broker
Stretch
Size of the market
Shares available at the highest bid and the lowest ask
Spread
Difference between highest bid and lowest ask
Types of quotes
- Firm - market maker, guaranteed execution, used for OTC, exchanges
- Subject - nominal, subject to change, not guaranteed
- Fast market - high level of trading/volatility, may sell lower or higher
- Firm w/recall - i.e. 1 hr 5 min recall, give another dealer a chance to sell
OTC
Negotiated markets, no location, no electronic exchange, brokerage to brokerage
Any security may trade otc
NASDAQ access levels
- Shows inside market
- Quotes by all mkt makers
- Mkt maker entry
IOC
Execute as much is possible and cancel the rest
Can be broken up
Day order
Cancelled by end of day
Selling short against the box
Shorting a security you own for tax deferral
CQS
Consolidated Quotation Service - lists all OPEN TRADES, listed, bid/ask, all mkts
All trades reported w/in 10 seconds of execution
Order of trading
- Priority - price
- Parity - time
- Precedence - size
Dealer
Stretch
UTP
Universal trading platform - keeps track of all stop and limit orders
OTC pink mkt
Electronic quotes are firm
Printed are subject
Not an exchange
No 10k or 10q
How long must UW keep prospectus available after public offering becomes available
40 days
Reverse split impact on orders
All orders cancelled
i.e 1 for 2
