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Small Order Execution System - SOES

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Definition of 'Small Order Execution System - SOES'

A computer network that automatically executed trades in Nasdaq market securities and some Nasdaq small cap securities. SOES allowed individual investors to execute trades in fast moving markets and gives them the same access to orders and execution as larger traders. It was implemented because of the lack of liquidity after the 1987 crash.
Investopedia Says

Investopedia explains 'Small Order Execution System - SOES'

SOES' legacy in the financial markets exists in how it essentially "leveled the playing field" and improved liquidity for small-scale investors. It required market makers to accept SOES orders that matched their advertised bid and ask prices, and allowed individual traders to execute orders with no more than 1,000 shares, and for stocks trading at no more than $250 per share.

Institutions could not use SOES; neither could brokers trading in their own accounts, but they could use SOES to trade on behalf of small clients.

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