FINRA PROPOSES TIMELIER REPORTING OF DEBT TRANSACTIONS
Since 2002 FINRA has collected and disseminated member transaction information in fixed income securities through its Trade Reporting and Compliance Engine (TRACE). FINRA is seeking comments on a proposal to reduce the trade reporting timeframe into TRACE for transactions in all eligible securities that are currently subject to a 15-minute reporting time frame to no later than one minute from the time of execution. FINRA would continue to make the information on the reported transactions publicly available immediately upon receipt of the dealer trade report.
While FINRA’s proposal would bring further transparency to U.S. fixed income markets, its unclear what impact it could have on market functioning. As previously outlined in an IIAC White Paper there exists a tipping point for fixed income markets where the benefits from incremental transparency can potentially be outweighed by adverse implications on market liquidity. The IIAC will review the proposal with its Debt Markets Committee.
For additional information contact jrando@iiac.ca.