Large trader reporting FAQs

Abstract

Purpose

The purpose of this paper is to provide frequently asked questions and answers in connection with the large trader reporting system.

Design/methodology/approach

The paper explains the large trader rule and filing requirements, including the application of the rule to non‐US entities; definitions, including Securities and Exchange Commission's (SEC's) definition of a “large trader”, a “NMS security”, and “person” for purposes of the rule; filing requirements; and the likely impact of broker‐dealers.

Findings

Certain broker‐dealers and entities that meet a trading threshold of aggregate transactions in NMS securities that equal or exceed two million shares or $20m during any calendar day, or 20 million shares or $200m during any calendar month, must file a Form 13H with the SEC.

Practical implications

The rule requires attention to an entity's trading levels, and requires making a filing with the SEC upon meeting certain activity levels.

Originality/value

The paper presents practical guidance from experienced financial services lawyers and compliance officers.

Citation

Sacks, R.D. and Blankenship, M.J. (2012), "Large trader reporting FAQs", Journal of Investment Compliance, Vol. 13 No. 1, pp. 23-29. https://doi.org/10.1108/15285811211216664