Chapter 13 - Trading Rules and Issues Flashcards
What is the maximum penalty for Wash or Matched trading where creating a false or misleading activity/liquidity…
10 years imprisonment under the Criminal Code.
What are the penalties under the criminal code for Insider Trading and Tipping
Insider Trading = 10 years
Tipping = 5 years
or $5million or multiple of profit made/lost
Who performs the overall oversight of various marketplaces?
IIIROC - performs specified self-reglatory oversight to TSX, TSX-V - ATS’s
What marketplaces does UMIR apply?
applies to train in Equities on All Canadian Listed Markets, including Exchanges, ATSs and Quotations and trade reporting systems (QTRS).
Who has to comply with UMIR?
Participants and Access Persons
What rule relives Participants of ‘Best-Price’ obligation
Order Protection Rule - prevent trade throughs and ensure limit orders are all filled.
What UMIR Rules deals with Trading Supervision Obligations
UMIR 7.1
Does IIROC have jurisdiction over Access Persons?
No IIROC Does not. The participant is accountable for the actions of an Access Person through the facilities of the dealer member
When does an issuer move from the Grey List to Restricted?
once the firm has agreed to act as an underwriter or banking group member, or to represent the issuer in an M&A.
What are the Trading Thresholds for executing a Cross that will move the market?
$1 for stocks trading under $20
$2 for stocks trading over $20
is it considered Double Printing if the Inventory is traded over multiple markets?
No it is not - the dealer has taken on risk to find liquidity.
What is the Last Sale Rule
short sale on a market governed by UMIR must generally be made at or above the last sale price of a board lot of at the security.
Under what conditions can a Short Sale take place where it is below the last traded price?
a programme trade Market Maker Obligations Arbitrage account Call Market Order Traded in an ETF
What is a Naked Short Sale?
It is where a short sale is conducted and the seller has not arranged to borrow the securities nor has them in his possession. Delivery to the buyer is Failed.
What is Short Bundling?
When the sale of a security incorporates both a Long position and Short Position. The trade can only be bundled if it is in the same account and should be marked SE.
