The Use of the Alternative Display Facility

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Chapters in this video

  1. 0:00 ADF overview and elective participation
  2. 1:47 Market makers, ECNs, and ATSs
  3. 2:55 Trading center certification requirements
  4. 3:22 ADF securities and round lot tiers
  5. 4:55 Withdrawal routes and effective dates
  6. 5:51 ADF stop stock versus OTC
  7. 6:58 Rapid-fire exam recap

What this video covers

  • Why ADF participation is elective, and why ADF rules apply alongside all other FINRA rules and federal securities laws
  • How a registered reporting ADF market maker acts for its own account, while a registered reporting ADF electronic communications network (ECN) displays orders for others
  • Why an alternative trading system (ATS) displaying orders through the ADF falls within the ECN definition
  • How market maker registration applies security by security, and the three requirements for becoming an ADF trading center
  • Which National Market System (NMS) stocks are ADF eligible, including Consolidated Quotation System (CQS) securities and Nasdaq securities
  • How Regulation National Market System (Regulation NMS) round-lot tiers work, including the 100-share default for a new NMS stock
  • The difference between ADF and OTC stop stock transactions, including when execution at the stop stock price or better is required

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This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete Series 57 course also includes adaptive practice questions and spaced-repetition flashcards, available in Free Beta.

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