NASD Notice to Members 98-010 - January 1998

Transaction Reporting and Quotation Obligations Under the Fixed Income Pricing System (FIPS)

Executive Summary

On April 11, 1994, The Nasdaq Stock Market Inc., began operation of the Fixed Income Pricing SystemSM known as FIPSSM for members trading high-yield bonds. FIPS was created to facilitate the over-the-counter trading of high-yield, corporate debt securities rated BB+ or lower by Standard & Poor’s Corporation. The goals in the creation of FIPS were similar to those which led to the creation of The Nasdaq Stock MarketSM—to increase information and transparency in the marketplace, thereby encouraging investment and growth.