Exam Alert: FINRA Provides Information to the Public on Dark Pool Transactions and 144A Transactions

On June 2, 2014, FINRA began providing information to the investing public about the transactions that occur on alternative trading systems (ATSs), including “dark pools.” On June 30, 2014, FINRA began providing information to the investing public about 144A transactions in corporate debt. Continue reading

On June 2, 2014, FINRA began providing information to the investing public about the transactions that occur on alternative trading systems (ATSs), including “dark pools.” Investors can see the total shares traded each week at each ATS. The information is available for free to non-professionals at FINRA’s website. Professionals must purchase a subscription to access the data.

On June 30, 2014, FINRA began providing information to the investing public about 144A transactions in corporate debt. 144A transactions are resales of corporate debt securities to large institutions called qualified institutional buyers (QIBs). Nearly 20 percent of the trading volume in corporate debt securities were 144A transactions in the first quarter of 2014. 144A issues are often foreign IPOs.

Information on 144A transactions will be disseminated through the Trade Reporting and Compliance Engine (TRACE) and through FINRA’s Market Data Center. The standards for dissemination will be the same as for non-144A transactions: a dissemination cap of $5 million for investment-grade corporate debt transactions, and a dissemination cap of $1 million for high-yield corporate debt transactions. 144A transactions are also subject to the same 15 minute reporting requirement as non-144A corporate debt transactions.

This alert applies to the Series 7, Series 24, Series 62, Series 79, and Series 82.

Sources:
FINRA Makes Dark Pool Data Available Free to the Investing Public
FINRA Brings 144A Corporate Debt Transactions Into the Light
FINRA Shines More Light on Some Private Bond Trades

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