If the Electronic Pink Sheets displays three active priced quotations, is a broker/dealer required to call the market makers to verify their quotations appearing on the Electronic Pink Sheets?
NASD Notice to Members 92-50, Question #41 provides that if the OTC Bulletin Board displays three firm quotations in a particular security, than a member does not have to call the market makers to verify their quotations appearing on the OTC Bulletin Board pursuant to Article III, Section 1 and 21 (b) of the NASD Rules of Fair Practice (currently NASD Conduct Rules 2320 and 3110). A broker/dealer need only note on the order ticket the identity of the broker/dealers and the firm quotations obtained from the OTC Bulletin Board. Because the Electronic Pink Sheets will be an inter-dealer quotation system that permits quotation updates on a real-time basis, the same reasoning should be applied so that a broker/dealer need only note on the order ticket the identity of the broker/dealers and the firm quotations obtained from the Electronic Pink Sheets.
Related Questions
- If the Electronic Pink Sheets displays three active priced quotations, is a broker/dealer required to call the market makers to verify their quotations appearing on the Electronic Pink Sheets?
- If a security is quoted on the Electronic Pink Sheets and the OTC Bulletin Board, will a broker/dealer have to check both quotation sources to achieve best execution for the firms customers?
- Will market data vendors be permitted to round sub-penny quotations to whole-penny increments in their data displays in NMS stocks for which the Rule permits sub-penny quotations?
