Friday, October 12, 2012
Data Technical News #2012 - 27
Updated 11/2/2012: OTC Equity Securities Minimum Quotation Size Requirement Changes
What you need to know:
What is changing?
Updated 11/02/2012: Effective Monday, November 12, 2012, FINRA will modify the OTC equity minimum quotation tier structure. FINRA will pilot the new tier structure for a minimum of one year, and will periodically review it to determine if the pilot tier changes should become permanent or be modified further. Under FINRA Rule 6433, every member firm that functions as a market maker in OTC equity securities by entering firm quotations into the OTC Bulletin Board Service (OTCBB) (or any other inter-dealer quotation system that permits quotation updates on a real-time basis) must honor those quotations for the minimum size defined.
What is the impact to the Bulletin Board Dissemination Service (BBDS) data feed?
There are no BBDS format or processing changes needed for the OTCBB minimum quotation size modification. As outlined in the BBDS specifications, FINRA disseminates the actual OTCBB market participant and Inside quotation size in units of trade. The Unit of Trade is communicated to the market data community via the OTCBB Symbol Directory and OTCBB Daily List files on OTCBB.com. As a general rule, the Unit of Trade should be 100 shares for OTCBB securities trading below $175.00 and 1 share for OTCBB securities trading at or above $175.00.
Where can I find the updated BBDS specification with the new OTCBB minimum quotation sizes?
What is the impact to the Trade Data Dissemination Service (TDDS) data feed?
There are no TDDS format or processing changes needed for the OTCBB minimum quotation size modification. TDDS disseminates trade volume in actual shares for all OTCBB and OTC securities.
Will FINRA offer any testing opportunities for the OTCBB minimum quotation size change?
FINRA will conduct production User Acceptance Tests (UATs) from 9:00 a.m. to 12:00 p.m., Eastern Time (ET) on Saturday, October 13, 2012. These tests will allow participants to test the modifications to support the OTC equity minimum quotation tier structure. Data Vendors who process the BBDS data feed are encouraged to participate in the tests as transaction data entered into the system during the test will be disseminated via the feed.
Where can I find additional information?
Questions or comments regarding this implementation and its testing should be directed by email to FINRA Product Management or by phone to +1 866 899 2107.
FINRATM is a trademark of the Financial Industry Regulatory Authority, Inc.
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