May a broker-dealer accept an order with a performance target (e.g., a volume weighted average price (“VWAP”)) that is or could be an impermissible sub-penny price?
Yes. A performance target is not generally a price subject to the Rule as long as it is not used analogously to a limit price for ranking or displaying an order. However, if the performance target were an explicit impermissible sub-penny price and also served as a limit price, then accepting the order would be a violation. Similarly, if the customer specifies a limit price in addition to the performance target, the limit price must meet the requirements of the Rule.
