Term
| 30 second update requirement |
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Definition
| Requires market makers update their quote to reflect customer limit orders |
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Rule 502 - Reg D
Net worth 1M
annual income 200K (joint 300k)
officer or director of issue
institutional investor |
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Definition
| A security created by US Bank that evidences ownership to a specified number of shares in a foreign country |
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| Advanced Computerized Execution Service (ACES) |
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Definition
| Subscription service that allows order entry firms to route orders to their preferred market makers internal trading system |
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| Average daily trading volume |
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Definition
| Holds power to vote 10% or more of the outstanding voting shares |
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| Affiliate in direct participation program |
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Definition
Owns 50% or more of the equity interest in the sponsor
includes 5% of the voting securities |
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Definition
| broker dealer acts on behalf for the account of others |
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Term
| Alternative Display Facility (ADF) |
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Definition
Display only facility operated by FINRA for the display of quotes, trade reports, and comparison of trades.
CQS listed securities as well as nasdaq listed securities are eligible to be posted |
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Term
| Anti-internalization qualifier (AIQ) |
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Definition
| a modifier that allows market makers to execute only against the quotes of other market makers |
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| Automated confirmation transaction service (ACT) |
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Definition
| compares trade information provided by market participants and submits locked-in trades for clearance and settlement. Also disseminates last sale information to public |
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Definition
| company with no business plan |
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Definition
a trade that exceeds the single trade limit of a correspondent firm in the ACT system.
Limit is 1M. Clearing firm has 15 mintues to accept or reject |
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Definition
SEC Rule 3b-8
Firms that purchase long or short blocks of stock worth 200k or more |
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Definition
| place where registered B/D conducts business |
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Definition
| placing selling pressure on stock to attempt to keep the price low or to move its price lower |
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| account in which the customer is required by the SEC's REG T to pay in full for securities no later than 2 days after standard payment period |
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| Same day trade is executed and payment is dude by 2:30est or within 30minutes if made after 2pm |
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| RULE 80B of the NYSE calls for trading halts based on the decline of DJIA |
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| Formal method of handling disputes or clearing controversies between members, public, clearing corps, associated persons |
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Definition
| Formal procedure for handling trade practice complaints involving Member Conduct Rules |
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| Consolidated Quotation System (CQS) |
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Definition
| A quotation system only providing last-sale reporting service for exchange listed-equity securities. Newly registered marker makers must begin entering quotes within 5 days |
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Definition
| A person who enters a trade at or near the same time and in the same security as a person who has acted on inside information |
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Definition
| Is required for all registered persons within 120 days of second registration and every 3 years thereafter |
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Definition
| Exists if a person directly or indirectly holds the power to vote, or holds proxies or securities more than 10% of a companies voting security |
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Definition
| When one market maker bids for stock at higher price than another market maker ask for the stock |
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Term
| Duration of Tender Offers |
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Definition
| SEC requires this period be at least 20 business days |
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Definition
| Insures deposits for 250K per depositer |
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Definition
| Regulates monetary system |
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| Insurance coverage required by self-regulatory organizations for all employees, officers, and partners of firms to protect members from theft. Usually 120% times capital requirement |
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Definition
| Deals with IPOs of common stock. Defines restricted persons as member firms, employees of member firms and immediate family, portfolio managers, finders and fiduciaries, 10% or more owners. |
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Definition
| Period between the time when market makers may re-enter quotations and the time when the security will be released for trading as indicated by the Nasdaq Market Watch through a T3 code |
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Definition
| A document filed with the SEC by officers, directors, and principal stockholders of a corporation to file an initial statement of beneficial ownership |
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| Used to update Form 3 when there are changes. Filed within 2 business days |
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| Form used to report events such as change in control etc |
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Definition
| A legal document used by an issuer of securities quoted on Nasdaq to report a change of more than 5% in the amt of securities it has outstanding. |
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| An annual audited report due within 90 days of year end. |
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Definition
| Quarterly report containing company unaudited financial data due 45 days after the end of the first 3 quarters |
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| SEC required form for investment managers who in the course of its business exercises discretion over 100M |
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| Also called ECN market where securities are traded directly from one institutional investor to another without Brokerage firm. |
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Definition
| Unemcumbered cash funds in customer accounts. Required notification from Broker/Dealer to customer at least quarterly. Liability on the BD books. |
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Definition
| Allows an underwriter to buy extra shares from issuer. Maximum number for new shares that can be purchased is 15% of the total number of shares covered by registration statement |
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Definition
| Placing a third party in the middle of a trade between a broker/dealer adn the best available market. Violation of FINRA rules unless it results in a benefit to the customer |
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Definition
| Broker/Dealer that does not hold customers money or securities. It introduces customer accounts to a clearing broker which holds all cash and securities |
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Definition
| Basic Nasdaq service, through a desktop quotation machine. Provides up to minute inside bid and ask quotations on 100s of OTC stocks |
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Definition
| Provides real time bid and ask quotations by market maker of each exchange |
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Definition
| Provides real time inside bid and ask quotations, supplies the bid and asks of each market maker for a security and allows each market maker to enter new and updated quotes |
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Definition
| Conflict of interest rules with Research Analysts |
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| SEC 15c2-11 firms that wish to make market in OTC pink or OTC BB securities must file form 211 with FINRA |
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Definition
| Performing riskless principal or agency trade for a client require contact of 3 market makers to obtain best market |
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Term
| Net Order Imbalance Indicator |
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Definition
| Disseminates inbalance information every 5 seconds. |
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| An abbreviated prospectus used by corporations issuing 5M or less of stock. Allows exemption from full registration of 1933 |
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| BD office responsible for supervising the activities of registered reps and associated persons housed in that office and in other offices within the same region |
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Definition
| Provision from 1933 that exempts small public offerings valued at no more than 5M worth of securities issued in a 12month period |
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Definition
| Provision of 1933 that exempts offering from registration sold to a maximum of 35 non-accredited investors |
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Definition
| SEC regulation that addresses market maker activities during syndication |
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| Mandates locate requirement with regard to short sales. Before entering order members are required to locate security to be assured that delivery can be made on the settlement date |
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Definition
| Targeting short sellers who purposely milead a broker/dealer about their ability or intention to deliver securities by the settlement date causing a fail deliver. |
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Definition
Federal Reserve Board regulation that governs customer cash accounts and the amt firsm may extend to customers for the purchases of securities.
The payment deadline is 2 days beyond regular way settlement |
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Definition
| Regulates loans by banks to BDs for the purchase of securities |
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Definition
| Restricts the activities of distribution participants during new offerings of securities under REG M |
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Definition
| Identifies restrictions on issuers and selling security holders and is intended to prevent market manipulation by these persons before a distribution under REG M |
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| Allows market makers(who are also syndicate members) to engage in passive market making during the restriction period |
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Definition
| Regulates the prices at which stabilizing bids may be made under REG M |
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Definition
| Prohibits manipulative short sales in anticipation of an offering under REG M |
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| SEC rule requiring that a person who hold control or restricted securities may sell them only in limited quantities |
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Definition
| Allows non registered foreign and domestic securities to be sold to certain qualified institutional investors in the US, without holding period requirements |
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Definition
| SEC rule that excepts stock splits and stock dividends from registratoin requirements of the Act of 1933 |
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Definition
| Provides exemption from the registration statement and prospectus requirements of the Act of 1933 for securities offered and sold exclusively intrastate |
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Definition
| Prohibits broker/dealer from using customer securities as collateral for a loan in excess of loans made to customers |
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Definition
| Requires prospective market makers in non-nasdaq stocks to file Form 211 with FINRA at least 3 days prior to quotation |
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Definition
| SEC Net Capital Rule governing net capital requirements of broker/dealers |
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Term
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Definition
| SEC rule requiring broker/dealers to inform customers of their free credit balances at least quarterly |
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Term
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Definition
Consumer protection rule
1. carrying firms have daily requirements to reduce to possession or control of fully paid for securities
2. Compute each week monies owed to BD by customers and owed by BD to customers |
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Definition
| Rule surrounding governing and maintaining of records |
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| Rules surrounding retentation time and sotrage by a broker/dealer and the posting of such records |
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| Rule surrounding the filing of Focus reports |
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| Rule governing violations of the net capital rule and setting out early warning rules. |
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Term
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| SHO requirement for participant in NSCC's Continuous Net Settlement System (CNS) to close out any fails that exists on the settlement date (T+3) for an equity security |
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Definition
| Defunct rule to learn facts about every customer |
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Definition
| Shelf offering 2 year period |
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Definition
| Offering may be exempt for registration with SEC providing it is less than 1M during any 12 month period. Unlimited credited and unaccredited investors |
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Definition
| Offering may be exempt for registration with SEC providing it is between 1M-5M during any 12 month period. Unlimited accredited investors 35 non-accredited investors |
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Definition
| Offering may be exempt for registration with SEC providing it is >5M during any 12 month period. Unlimited accredited investors 35 non-accredited investors |
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| Order protection rule to prevent trade throughs |
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| Admission standards into FINRA |
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Definition
| FINRA rule prohibits market participants from displaying, ranking, and accpting quotations, orders, or indications of interest in OTC Equity Securities priced in an increment smaller than 0.01. |
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Definition
Form filled out by individual after acquiring 5% ownersihip in any nonexempt equity security
Must be sent within 10 days |
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Definition
Used by an investment company, bank or insurance company if it acquires 5% position in the normal course of business of nonexempt security
Must be filed 45 days after the first calendar year end |
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| Locate requirement by broker dealer prior to trade entry of short sale |
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