Regulation NMS

AAA

DEFINITION of 'Regulation NMS'

National Market System (NMS) is a set of rules passed by the Securities and Exchange Commission (SEC), which looks to improve the U.S. exchanges through improved fairness in price execution as well as improve the displaying of quotes and amount and access to market data.

INVESTOPEDIA EXPLAINS 'Regulation NMS'

This regulatory ruling is comprised of four main components:

  • The Order Protection Rule aims to ensure that investors receive the best price when their order is executed by removing the ability to have orders traded through (executed at a worse price).
  • The Access Rule, aims to improve access to quotations from trading centers in the National Market System by requiring greater linking and lower access fees.
  • The Sub-Penny Rule, which sets the lowers quotation increment of all stocks over $1.00 per share to at least $0.01.
  • Market Data Rules, which allocate revenue to self-regulator organizations that promote and improve market data access.
RELATED TERMS
  1. Volcker Rule

    The Volcker rule separates investment banking, private equity ...
  2. Nasdaq

    A global electronic marketplace for buying and selling securities, ...
  3. Trade Through

    A stock market order that is not executed at the best possible ...
  4. National Market System - NMS

    A system with two main functions: 1. To facilitate trading of ...
  5. American Stock Exchange - AMEX

    The third-largest stock exchange by trading volume in the United ...
  6. New York Stock Exchange - NYSE

    A stock exchange based in New York City, which is considered ...
RELATED FAQS
  1. What does it mean when a stock trades on the Pink Sheets or the OTCBB?

    The stocks of well-known companies such as General Electric and Microsoft trade on major exchanges such as the New York Stock ... Read Full Answer >>
  2. What role does the Inspector General play with the Securities and Exchange Commission?

    The inspector general of the U.S. Securities and Exchange Commission (SEC) oversees, audits and conducts investigations of ... Read Full Answer >>
  3. How is trading volume regulated by the Securities and Exchange Commission (SEC)?

    The U.S. Securities and Exchange Commission (SEC) has trading volume as a requirement for selling securities that are otherwise ... Read Full Answer >>
  4. What is a private secondary market?

    Two kinds of private secondary markets exist. The first is a form of buying and selling of pre-existing financial commitments ... Read Full Answer >>
  5. How does the role of Medicare/Medicaid affect the drugs sector in the U.S.?

    Medicare and Medicaid have enormous influence on the pharmaceutical, or drugs, sector in the United States. For instance, ... Read Full Answer >>
  6. What are the ethical arguments against government subsidies to companies like Tesla?

    The ethical argument behind government subsidies is that they should be put into place to help industries that will, in turn, ... Read Full Answer >>
Related Articles
  1. Personal Finance

    The Birth Of Stock Exchanges

    Learn how British coffeehouses helped give rise to the juggernaut that is the NYSE.
  2. Options & Futures

    Getting To Know The Stock Exchanges

    Here are the answers to all the questions you have about stock exchanges but are too afraid to ask!
  3. Options & Futures

    The NYSE And Nasdaq: How They Work

    Learn some of the important differences in the way these exchanges operate and the securities that trade on them.
  4. Mutual Funds & ETFs

    Getting Into International Investing

    Diversifying can mean not only investing in various asset classes but also venturing beyond domestic exchanges.
  5. Economics

    The Stock Market: A Look Back

    The past century was marked by furious economic change. What can it tell us about what lies ahead?
  6. Trading Systems & Software

    The Global Electronic Stock Market

    The way trading is conducted is changing rapidly as exchanges turn toward automation.
  7. Economics

    What Are The 5 Hottest Emerging Industries In 2015?

    These five industries are poised to explode in 2015.
  8. Investing

    Why We Need Antitrust Laws

    A look at antitrust laws in the United States and the many anticompetitive practices they safeguard against.
  9. Trading Strategies

    IPO Flippers And The Companies Who Hate Them

    Learn how flipping activity affects an initial public offering.
  10. Economics

    Global Impact of China's Geopolitical Strategy

    China's geopolitical strategy is shifting the status quo from the Pacific to the Pentagon. Can the U.S. keep pace with Chinese military innovation?

You May Also Like

Hot Definitions
  1. Nuncupative Will

    A verbal will that must have two witnesses and can only deal with the distribution of personal property. A nuncupative will ...
  2. OsMA

    An abbreviation for Oscillator - Moving Average. OsMA is used in technical analysis to represent the variance between an ...
  3. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  4. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  5. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  6. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!