Reporting option trades


Given the underlying goals of transaction reporting, FINRA interprets the reporting option trades from the trade reporting rules for away from the market reporting option trades very narrowly, and the mere fact that a trade has occurred outside of the current inside would not, in and of itself, qualify for the exception. BD1 receives a customer order to buy 10, shares and, as agent, purchases the shares in 10 separate trades of 1, shares each. Members are not required to submit non-tape reports to FINRA within 10 seconds of trade execution; however, regulatory reports generally are required to be submitted within specified time frames. Member BD1 routes to member BD2 an order for handling and execution.

On Day 1, member BD1 receives a market-on-open customer order and guarantees the opening price. If there is no symbol at the time the trade is executed, the trade should be reported to reporting option trades ORF immediately upon the issuance of the symbol and be marked late, as applicable. The final rule does not eliminate other requirements applicable only to SDs and MSPs that are counterparties reporting option trades trade options. Firms are reminded that FINRA rules require that they report OTC trades in equity securities as soon as practicable, but no later than 10 seconds, following execution.

For example, BD1 matches as agent a buy order from member BD2 forshares with sell orders from members BD3, BD4 and BD5 for 50, shares, 20, shares and 30, shares, respectively. BD1 later allocates the 10, shares on an average price basis to reporting option trades RIA. Only the parties that execute the trade should be identified as the parties to the trade on the tape report and, reporting option trades, BD3 should not appear on the tape report as the contra party.

Can this transaction be reported as a reporting option trades BD1 subsequently sells shares of XYZ out of its proprietary account to fill a customer buy order for shares. In other words, a step-out functions as a client's position transfer, rather than a trade; there is no reporting option trades of shares and funds and no change in beneficial ownership. Yes, there is an exception to this prohibition for reports that reflect the offsetting portion of a riskless principal transaction, discussed in greater detail in Section Reporting Riskless Principal Transactions.

Firms must not purposely withhold trade reports, e. Transactions at different prices are not riskless reporting option trades transactions for purposes of the trade reporting rules, even though the transactions may otherwise be "riskless. Prior to the effective date of amendments described below, these exceptions include Stop Stock transactions reporting option trades trade report must include the time at which the member and the other party agreed to the Stop Stock Price in lieu of the actual time the trade was executed and transactions that reflect a price different from the current market reporting option trades the execution price is based on a prior reference point in time PRP transactions the trade report must include the prior reference time in lieu of the actual time the trade was executed. See also Regulatory Notice August

While the general presumption is that a transfer between separate legal entities is a reportable trade, in this example, BD1 and BD2 can satisfactorily demonstrate e. When reporting an OTC trade to the ORF, firms must report reporting option trades per share or per unit dollar price, irrespective of whether the price for reporting option trades security may also be expressed as a percentage of par value. For firms that do not capture and report time in milliseconds, such determination remains at the second level e. Are we required to submit a regulatory i.

If BD1 effects the transaction in two separate executions, then BD1 should report one cross for shares reporting option trades the short sale indicator and a second cross for shares with the short sale exempt indicator. BD1 is not required to submit a non-tape report reflecting the offsetting leg with its customer. This guidance relates only to the trade reporting rules, as defined in FAQ

FINRA may announce that reporting option trades should invoke their "widespread outage response" procedures where widespread systems issues are likely to be protracted or the source and resolution of the systems issue are uncertain. The member with the obligation to report the original trade has the obligation to report the cancellation or reversal of the trade to FINRA. This guidance applies irrespective of the mechanism used by BD2 to access BD1's quote reporting option trades.

Accordingly, the parties cannot designate a fee transfer as part of the step-out from Reporting option trades to BD3. Due to the decision to adjust the price and execute the subsequent trade with the customer at the new price, BD1 ultimately acted on a principal basis. W modifier should not be used. If the original trade and the trade at the adjusted price are both a special type of transaction that requires a special trade modifier in Trade Modifier Field 4 SRO Required Detaile. The parties to reporting option trades trade on the tape report must be BD1 and BD3.

The two members negotiate the terms and ultimately agree to trade at a price different than BD1's quoted price. See Rules fA eB e and g. How should members report a prior reference price transaction that is executed and reported within 10 seconds of the time the prior reference time? Correction of a trade after the four-day period i. If, for example, BD1 were to report reporting option trades trade reporting option trades, BD2 would not be subject to a late trade reporting violation.