Self Trade Prevention

Self trade prevention is an optional order feature that prevents two orders from the same Participating Organization or member Firm from executing against each other based on unique trading keys defined by the Participant/Member.

Cancel Newest Self-Trade Prevention

An optional feature that prevents two orders from the same broker from executing against each other based on unique trading keys defined by the broker. An active order is rejected instead of trading against a resting order from the same broker with the same unique trading key.

Cancel Oldest Self-Trade Prevention

The Cancel Oldest self-trade prevention instruction will prevent an incoming order from executing against a passive order from the same broker with a self-trade prevention instruction and matching self-trade keys. The passive order will be cancelled and the active order will trade up or down to its limit, booking any remaining volume if eligible.

Decrement Largest and Cancel Smallest Self-Trade Prevention

The Decrement Largest and Cancel Smallest self-trade prevention instruction will prevent an incoming order from executing against a passive order from the same broker with a self-trade prevention instruction and matching self-trade keys. If both orders are equivalent size, both orders will be cancelled. If orders are not equivalent in size, the smaller order will be cancelled and the larger order will be decremented by the size of the smaller order. If the larger order was passive, the remaining volume will continue to rest in the book; if the larger order was active, the balance of the order will trade up or down to its limit, booking any remaining volume if eligible.

 

This feature provides more opportunities for individuals to participate on both sides of the market without unintentionally violating 'wash trading' rules described in UMIR 2.2. Rules permit individuals to place buy and sell orders on a market for a given stock at the same price so long as that individual only trades with others and does not cross his own orders. Preventing self trading ensures there is no misleading appearance of additional trading in a stock.

For detailed instructions see our specifications in the Secure Documentation Portal.

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