Locked Market Violations Corrected
Traders Magazine, July 2001
Several recently fined and suspended firms, whose IPO actions caused crossed and locked markets according to NASD Regulation, have filed corrective action plans. Ten firms were fined and five of them were also suspended from market-making activities because the after market of their IPOs caused locked and crossed markets, regulators said. "Locked crossed quotations," said NASD Regulation in a statement announcing the fines, "may occur in fast-moving markets and can have significant impact on the opening of newly traded securities. Many secondary trading markets were opening crossed by several points and in some cases, the locked or crossed condition existed for many minutes into the secondary trading period." These actions hurt orderly market and price discovery procedures, the regulators said.
All TradersMagazine.com articles are archived after 7 days. REGISTER NOW for unlimited access to all recently archived articles, as well as thousands of searchable stories. Registered Members also gain access to exclusive industry white paper downloads, web seminars, online technology directory, the iPad App, and conference discounts. Qualified members may also choose to receive our free monthly magazine and any of our e-newsletters covering the latest breaking news, opinions from industry leaders, developing trends and trading strategies.