New Quote Management System for the OTCBB
In response to growing demands and future considerations, the National Association of Securities Dealers (NASD®) has developed a new technology infrastructure to consolidate the Nasdaq® quotation systems. The Integrated Quotation Management System (IQMS) project integrates, in phases, existing quotation services onto a single hardware platform - Unisys - and provides value-added enhancements. The first phase of IQMS, to be released on August 31, 1998 (revised from August 17th), will only support quotation for OTC Bulletin Board® (OTCBB) securities. Later phases will support Nasdaq National Market® (NNM), Nasdaq SmallCap, and Exchange Listed (CQS) issues.
The primary reasons for the replacement are maintainability and modularity. IQMS has been developed utilizing standard Unisys products, affording easier maintenance and future growth potential. Going forward, Nasdaq will be able to take advantage of the vendor support and future enhancements provided by Unisys. The new system will also address Year 2000 (Y2K) concerns and provide Nasdaq with a flexible infrastructure that can support future business needs, such as decimal pricing.
In order to avoid disruption to our subscribers, the transition to IQMS will be as transparent as possible to the member firms. However, market participants will notice some differences, which follow:
- IQMS: Security name truncates after 20 characters (although 30-character names will still be available in the symbol directory).
Legacy: Security name allowed 30 characters.
- IQMS: If there is no inside quote, the inside display is left blank.
Legacy: If there was no inside quote, this field displayed "NQ."
- IQMS: "U" is displayed as the Market Center identifier for the OTCBB.
Legacy: There was no such identifier in legacy OTCBB.
- IQMS: "Not Dynamic" is in initial capitals. ("Not Dynamic" indicates that quote updates are not automatically broadcast to users; you must refresh the screen by hitting enter.)
Legacy: "NOT DYNAMIC" was in all capitals.
- IQMS: The "D" indicates the depth at the inside.
Legacy: There was no such indicator in legacy OTCBB.
- IQMS: Users can see the full display of Market Makers in the quote montage on a single screen.
Legacy: Users were only able to see three Market Makers, then "MORE."
Some OTCBB functionality could not be implemented with this release of IQMS. The features detailed below, which are available in legacy OTCBB, will not be available in the first IQMS release. However, these features will return will the next release, which will likely be in the second quarter of 1999.
- A simultaneous registration and quote update will not be available until the second release of IQMS. With the first release, only a registration will be accepted and "blanks" will be displayed for bid & ask prices. For now, once you have registered in a security, you can immediately hit the Quote Only button to enter a quote.
- The OTCBB Telephone is not available until the second release of IQMS. If you select "OTCBB" Tel #" in the Nasdaq Workstation II® (NWII) menu, you will get a reject message. Instead, in IQMS, the Market Maker phone number can be obtained from the Automated Directory Services under Info Services on the main menu bar.
- The OCTBB Current Position Summary will not be available. For now, if you select "MarketMaking," "Positions," and then "OTCBB" from the NWII menu, you will get a reject message. However, you can call Market Operations at (800) 219-4861. Market Operations can access a supervisory function and provide that information.
There is one feature in legacy OTCBB that will be omitted from any future version using IQMS. You will not be able to use the uptick/down-tick box in the Dynamic Quote Window from a zero quote. Rather, an up-tick or down-tick may only be applied to a priced quote. Additionally, you may not up-tick or down-tick on one side and enter a price on the other.
Finally, market participants should remember that OTCBB service is available between 7:30 a.m. and 6:30 p.m. This will be strictly enforced for IQMS.
If you have any questions about IQMS or changes to OTCBB, please call Yek Eng, Product Development, at (212) 858-4306.
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