Commencement Of Tick Size Pilot Program

Today, the two-year tick size pilot program, which was proposed by the national securities exchanges and FINRA in June 2014 and approved by the SEC in May 2015, officially commenced.  The pilot program is a data-driven test to evaluate whether or not widening the minimum quoting and trading increments ("tick sizes") for stocks of smaller capitalization companies would impact the trading, liquidity and market quality of those stocks.  The SEC modified several provisions of the pilot program initially proposed by the national securities exchanges and FINRA.  A variety of data generated during the tick size pilot will be released publicly on an aggregated basis to assist in analyzing the impact of wider tick sizes on smaller capitalization stocks.  In addition, the national securities exchanges and FINRA must submit their initial assessments of the pilot program's impact by April 1, 2018 based on data generated during the first 12 months of the pilot program's operation.