Threshold List


DEFINITION of 'Threshold List'

A daily public accounting of market settlement system failures (or 'fails') published by the National Securities Clearing Corporation in compliance with SEC regulations. A market settlement failure occurs when delivery on a security is not made within the alloted settlement period.

Also referred to as the "Regulation SHO Threshold Security List".

BREAKING DOWN 'Threshold List'

A security will make the threshold list if it meets the following criteria over five consecutive settlement days:
1) The total number of fails to deliver exceed 10,000 shares,
2) The total number of shares that have failed to deliver exceed 0.5% of the outstanding shares and
3) The security is listed on a similar list by a self-regulatory organization.

Once a company is added to the list it remains there until the 'fails' fall beneath the benchmark standards for five consecutive trading days. Many stocks that have allegedly seen naked short selling will end up on this list.

  1. Naked Shorting

    The illegal practice of short selling shares that have not been ...
  2. Regulation SHO

    A regulation implemented on January 3, 2005 that seeks to update ...
  3. Securities And Exchange Commission ...

    A government commission created by Congress to regulate the securities ...
  4. Failure To Deliver

    An outcome in a transaction where one of the counterparties in ...
  5. National Securities Clearing Corporation ...

    A subsidiary of the Depository Trust & Clearing Corporation ...
  6. Encumbrance

    A claim against a property by a party that is not the owner. ...
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