The Over-the-Counter (OTC) Comparison service accepts one-sided transactions from NSCC participants and matches buyers and sellers based upon clearing firm, executing market participant ID, CUSIP or trading symbol, share quantity, price and trade date.

Overview

The Over-the-Counter (OTC) Comparison service accepts one-sided transactions from NSCC participants and matches buyers and sellers based upon clearing firm, executing market participant ID, CUSIP or trading symbol, share quantity, price and trade date. Once a match is established the trade is recorded and a contract is forwarded to the participants confirming the comparison. For securities eligible at the depository, the trade data is also forwarded to NSCC's Continuous Net Settlement (CNS) system for settlement as well as risk management systems for risk control.

Transactions that do not result in a match during the NSCC comparison process are also reported to participants on the night the trade was submitted. Participant can continue to try and establish a match by resubmitting the trade to the NSCC comparison process the following day directly or through the facilities of Nasdaq's Automated Confirmation Transaction (ACT) system.

Who Can Use the Service

The service is available to all NSCC members.

Benefits

The service provides a number of operational advantages:

• Transactions could be matched at three different levels.
• Settlement is centralized in NSCC's CNS application (for CNS eligible securities).
• Participants can resubmit unmatched transactions until a match is achieved.
• Participants receive an advisory when another participant names them as the counter-party to an unmatched trade.
• Participants receive feedback on both matched and unmatched transactions. 

How the Service Works

The OTC comparison application accepts one-sided trade data at the end of each business day. The service then searches for a match for each submission based on a number of match criteria, they follow:

• M1 - All terms on the contract agree (exact match),
• M2 - All terms agree except trade quantity (summarized match), and
• M3 - All terms agree except quantity and two executing broker (summarized two-way match).

Results of the match are reported to participants on NSCC's 400-byte MRO intra-day output as well as on end-of-day print image files. The intra-day output was created in a universal format so that all trade data is reported using virtually the same record layout. 

For More Information:

Please call Relationship Management at 1 888.382.2721.