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General Q/A
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Covered short-sell cash equity order
Tom Vasak / Citigroup Global Markets <>
24 Sep 2008 12:25AM ETIn the current environment where regulators of equities markets are imposing constraints on short selling (naked and/or covered), we are looking at mechanisms within FIX that allow buy-side clients to specify that their equity order is covered by a lending agreement.
One option we see is:
- Using Tag 54 (side) = 5 sell short
- Using Tag 113 (LocateReqd) = Y/N
Where 54=5 and 113=Y, this would imply that the short sell is covered (at least if the receiving broker can locate the stock).
Where 54=5 and 113=N, this doesn't disambiguate naked short selling from the case of covered short selling where the receiving broker does not need to provide stock borrow (i.e. seller has other lending agreement in place).
Is there another option? Tag 203 (CoveredOrUncovered) doesn't appear applicable to cash equities.
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Tom
Covered short-sell cash equity order
Tom Vasak / Citigroup Global Markets 24 Sep 2008 12:25AM ET
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