FINRA reminded member firms, in light of the increasingly automated markets for National Market System ("NMS") stocks, to fully and promptly execute marketable customer orders by making sure their systems are reasonably designed to achieve compliance with this obligation. in light of the increasingly automated markets for National Market System ("NMS") stocks,
In a Regulatory Notice, FINRA noted that the term "prompt" as used in FINRA Rule 5310.01 ("Best Execution and Interpositioning") is not a specific amount of time, and firms must evaluate their definition of "prompt" to take into account (i) developing technology for the routing and execution of orders for NMS stocks and (ii) the increasing speed with which many marketable customer orders are being executed.
FINRA also observed that the majority of held market orders in NMS stocks are executed within 500 milliseconds following the receipt or triggering of an order. In light of the increasingly automated markets for these stocks, FINRA expects member firms to regularly evaluate their systems to achieve compliance.
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