Regulatory Notice 16-21

SEC Approves Rule to Require Registration of Associated Persons Involved in the Design, Development or Significant Modification of Algorithmic Trading Strategies

Effective Date: January 30, 2017

Executive Summary

The SEC approved an amendment to NASD Rule 1032(f) that expands the scope of persons required to register as a Securities Trader. Specifically, beginning January 30, 2017, each associated person who is primarily responsible for the design, development or significant modification of an algorithmic trading strategy relating to equity, preferred or convertible debt securities, or who is responsible for the day-to-day supervision or direction of such activities, must pass the Series 57 exam and register as a Securities Trader. The rule text is available in the online FINRA Manual.

Questions regarding this Notice should be directed to:

  • Susan Tibbs, Vice President, Quality of Markets, Market Regulation, at (240) 386-5082;
  • Joe McDonald, Senior Director, Testing and Continuing Education, at (240) 386-5065; or
  • for legal and interpretive questions, Racquel Russell, Associate General Counsel, Office of General Counsel, at (202) 728-8363.