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Tick Size Pilot Program

On May 6, 2015, the Securities & Exchange Commission (SEC) issued an order approving the National Market System (NMS) Plan to implement a Tick Size Pilot Program by the National Securities Exchanges and FINRA.  The Order approved the NMS Plan for a two-year period and officially commenced on October 3, 2016. 

The Tick Size Pilot was a data-driven test to evaluate whether or not widening the tick size for securities of smaller capitalization companies would impact trading, liquidity, and market quality of those securities.  The pilot consisted of a control group and three test groups, with each test group having approximately 400 securities.

The groups were defined as follows:

  • The control group was quoted and traded at their current tick size increment.
  • The first test group was quoted in $0.05 increments, but continued to trade at their current price increment.
  • The second test group will be quoted and trade in $0.05 minimum increments, but would allow certain exemptions for midpoint executions, retail investor executions, and negotiated trades.
  • The third test group adhered to the requirements of the second test group, but was also subject to a "trade-at" requirement. There was also an exemption for block size orders.

Market quality statistics, market and marketable limit order data, and market maker profitability were collected and provided to the SEC on a monthly basis.  Market quality data and aggregated market maker profitability data were also made publicly available on a monthly basis by each Plan Participant that acted as the designated examining authority for a Trading Center or Market Maker that was required to submit data under the plan.

On July 3, 2018, the Participants submitted a joint assessment based on the data generated during the first 12 months of operation to the Commission.

On March 29, 2019, the data collection requirements under the National Market System (NMS) Plan to implement a Tick Size Pilot Program (Tick Size Pilot) came to an end.

Download the Publicly Available Data

Questions

Contact FINRA Tick Size Pilot Program.