Internal Resources
Clearly Erroneous Trade Policy | Business Continuity Plan | AML Policy | Extended Trading Hours | Disclosure
External Resources
Order Execution-S3 | Order Execution-Karn | FINRA Broker Check | Form ATS-N |Â
Disclosures
Clearly Erroneous Trade Policy
A Clearly Erroneous Trade is when there is an obvious error in any term, such as price, number of shares or other unit of trading defined as an execution at a price, for a quantity of shares, or with a symbol, that is substantially inconsistent with the current trading pattern of the issue. A transaction made in clearly erroneous error and cancelled by both parties or determined by CODA MARKETS to be clearly erroneous will be removed from the Consolidated Tape.
A subscriber that receives an execution on an order that was submitted erroneously to the CODA MARKETS for its own or customer account may request that CODA MARKETS review the transaction. An officer of the ATS or such other employee designee of the ATS shall review the transaction under dispute and determine whether it is clearly erroneous, with a view toward maintaining a fair and orderly market and the protection of investors and the public interest. Such request for review shall be made in writing via email or other electronic means.
Requests for review shall be received by CODA MARKETS within thirty (30) minutes of execution time and shall include information concerning the time of the transaction(s), security symbol(s), number of shares, price(s), side (bought or sold), and factual basis for believing that the trade is clearly erroneous. Upon receipt of a timely filed request these guidelines, the counterparty to the trade, if any, shall be notified by CODA MARKETS as soon as practicable, but generally within thirty (30) minutes. CODA MARKETS may request additional supporting written information to aid in the resolution of the matter. If requested, each party to the transaction shall provide any supporting written information as may be reasonably requested by the CODA MARKETS to aid resolution of the matter within thirty (30) minutes of CODA MARKETS’ request. Either party may request the supporting written information provided by the other party on the matter.
Numerical Guidelines
Under the uniform guidelines, a transaction executed during the pre-market trading session, the core trading session and post-market trading session may be found to be clearly erroneous only if the price of the transaction to buy is greater, or less in the case of a sale, than the Reference Price by an amount that equals or exceeds the Numerical Guidelines for a particular transaction category (as set forth below).
CODA MARKETS will generally use the consolidated last sale as the Reference Price to determine whether a trade is clearly erroneous. The execution time of the transaction under review determines which Numerical Guideline is applied. The chart below outlines the details.
Reference Price: Consolidated Last Sale
Core Trading Session Numerical Guidelines (Subject transaction’s % difference from the Consolidated Last Sale):
Pre-market and Post-market Trading Session Numerical Guidelines (Subject transaction’s % difference from the Consolidated Last Sale):
- Greater than $0.00 up to and including $25.00
10%Â Â 20% - Greater than $25.00 up to and including $50.00
5%Â Â 10% - Greater than $50.00
3%  6% - Multi-Stock Event – Filings involving five or more securities by the same subscriber will be aggregated into a single filing
10%  10% - Multi-Stock Event – Filings involving twenty or more securities whose executions occurred within a period of five minutes or less
30%Â Â 30%
Leveraged ETF/ETN Securities
Core Trading Session Numerical Guidelines multiplied by the leverage multiplier (e.g., 2x)
CODA MARKETS may consider additional factors to determine whether an execution is clearly erroneous. These factors include, but are not limited to, system malfunctions or disruptions, volume and volatility for the security, derivative securities products that correspond to greater than 100% in the direction of a tracking index, news released for the security, whether trading in the security was recently halted/resumed, whether the security is an IPO, whether the security was subject to a stock-split, reorganization, or other corporate action, overall market conditions, pre-market and post-market session executions, validity of the consolidated tapes trades and quotes, consideration of primary market indications, and executions inconsistent with the trading pattern in the stock. Each additional factor shall be considered with a view toward maintaining a fair and orderly market, the protection of investors and the public interest. Volatile Market Opens
During a Volatile Market Open, CODA MARKETS may expand the Numerical Guidelines applicable to transactions occurring between 9:30 a.m. and 10:00 a.m. based on the disseminated value of the S & P 500 Futures at 9:15 a.m.:
When the S & P 500 Futures are up or down from 3%, to up to but not including 5% at 9:15 a.m., the Numerical Guidelines are doubled for executions occurring between 9:30 a.m. and 10:00 a.m.
When the S & P 500 Futures are up or down 5% or greater at 9:15 a.m., the Numerical Guidelines are tripled for executions occurring between 9:30 a.m. and 10:00 am.
Unusual Circumstances
In Unusual Circumstances, CODA MARKETS may use (while attempting to maintain a fair and orderly market, protect investors and public interest) a Reference Price other than the consolidated last sale. Unusual Circumstances can include periods of extreme market volatility, sustained illiquidity, or widespread system issues. Other Reference Prices may include the consolidated inside price, the consolidated opening price, the consolidated prior close, or the consolidated last sale prior to a series of executions.
Joint Market Rulings
In circumstances that involve other markets, CODA MARKETS could potentially use a different Reference Price and/or Numerical Guideline. In these circumstances, the Reference Price would be determined based on a consensus among the exchanges where the transactions occurred.
Reviews Initiated by CODA MARKETS
In its sole discretion, CODA MARKETS reserves the right to initiate a review of a transaction if it determines that circumstances warrant such a review, regardless of whether or not a client request has been submitted. Any affected clients shall be notified accordingly.
Business Continuity Plan
CODA Markets, Inc. (CODA MARKETS) has developed a Business Continuity Plan (BCP) that includes the ability to recover from situations including, but not limited to floods, power outages and any facilities failures that may cause business interruptions. Though CODA Markets does not maintain a redundant recovery site, the key features of the CODA MARKETS BCP include annual review of the following; 1) identification of all mission critical systems (and system back-up and recovery for such systems), 2) review of financial and operation risks, 3) systems and telecommunication accessibility 4) alternate communications between CODA MARKETS, its subscribers, employees and regulators and critical business constituents.
Although no contingency plan can eliminate all risk of service interruption, CODA MARKETS assesses and updates its BCP to mitigate reasonable risks. While the specific details of our BCP are proprietary and contain information which is confidential, CODA MARKETS’s policy is to respond to a significant business disruption by safeguarding employees lives and firm property, making a financial and operational assessment, quickly recovering and resuming operations, protecting CODA MARKETS’s books and records, and allowing CODA MARKETS subscribers to continue to transact business. As we continue to test our plans and as conditions in our firm and the industry change, we will revise the plan accordingly and as considered necessary.
AML Policy
In consideration of CODA Markets, Inc. (“CODA MARKETS”) facilitating orders on behalf of its Subscribers and/or their clients, by using the CODA MARKETS System, each Subscriber approved to use the CODA MARKETS System agrees and confirms that:
(i) It is a financial institution regulated by a Federal functional regulator (which includes, among others, a broker-dealer registered with the Securities and Exchange Commission).
(ii) It has established and has in effect, and agrees to maintain, written anti-money laundering (“AML”) policies and procedures that comply with the USA Patriot Act of 2001 and the Bank Secrecy Act (31 U.S.C. 5311, et seq.) (together, the “AML Laws”), to the extent applicable.
(iii) Its AML policies and procedures meet or exceed the requirements of the AML Laws.
(iv) It will designate, and identify to CODA MARKETS (by name, title, mailing address, e-mail address, telephone number, and facsimile number), a person or persons responsible for implementing and monitoring the day-to-day operations and internal controls of the AML program and provide prompt notification to CODA MARKETS regarding any change in such designation(s).
(v) With respect to each client that Subscriber introduces to CODA MARKETS: Subscriber is acting as an intermediary or nominee for the subscriber/client.
Pursuant to Subscriber’s AML policies and procedures, Subscriber has in place policies and procedures that verify the identity of the subscriber/client, and if not an individual, its beneficial owners; that can be reasonably expected to detect and cause the reporting of transactions (monetary, securities trading or otherwise) required under 31 U.S.C. 5318(g) and the implementing regulations thereunder, as applicable, and that are reasonably designed to achieve compliance with the Bank Secrecy Act and the implementing regulations thereunder, as applicable. Pursuant to Subscriber’s policies and procedures, Subscriber has taken or will take reasonable steps to verify that Subscriber has not received money or securities from any illicit activity from the subscriber/client.
Extended Trading Hours
Extended Hours Trading Risk Disclosure You should consider the following points before engaging in extended hours trading. “Extended hours trading” means trading outside of “regular trading hours.” “Regular trading hours” generally means the time between 9:30 a.m. and 4:00 p.m. Eastern Standard Time. Risk of Lower Liquidity. Liquidity refers to the ability of market participants to buy and sell securities. Generally, the more orders that are available in a market, the greater the liquidity. Liquidity is important because with greater liquidity it is easier for investors to buy or sell securities, and as a result, investors are more likely to pay or receive a competitive price for securities purchased or sold. There may be lower liquidity in extended hours trading as compared to regular trading hours. As a result, your order may only be partially executed, or not at all. Risk of Higher Volatility. Volatility refers to the changes in price that securities undergo when trading. Generally, the higher the volatility of a security, the greater its price swings. There may be greater volatility in extended hours trading than in regular trading hours. As a result, your order may only be partially executed, or not at all, or you may receive an inferior price when engaging in extended hours trading than you would during regular trading hours. Risk of Changing Prices. The prices of securities traded in extended hours trading may not reflect the prices either at the end of regular trading hours, or upon the opening the next morning. As a result, you may receive an inferior price when engaging in extended hours trading than you would during regular trading hours. Risk of Unlinked Markets. Depending on the extended hours trading system or the time of day, the prices displayed on a particular extended hours trading system may not reflect the prices in other concurrently operating extended hours trading systems dealing in the same securities. Accordingly, you may receive an inferior price in one extended hours trading system than you would in another extended hours trading system. Risk of News Announcements. Normally, issuers make news announcements that may affect the price of their securities after regular trading hours. Similarly, important financial information is frequently announced outside of regular trading hours. In extended hours trading, these announcements may occur during trading, and if combined with lower liquidity and higher volatility, may cause an exaggerated and unsustainable effect on the price of a security. Risk of Wider Spreads. The spread refers to the difference in price between what you can buy a security for and what you can sell it for. Lower liquidity and higher volatility in extended hours trading may result in wider than normal spreads for a particular security.
Tim Lang, the CEO and Founder of Global Liquidity Partners, is an equity trading professional with over 40 years of Wall Street experience. Tim’s vision of GLP in 2010 was driven by his belief that there was a technology void in the equity marketplace due to all of the emerging fragmentation of trading venues. His goal was to create a best-in-class, performance-driven equity execution services platform. His role at GLP is all-inclusive as he remains active in strategy design, marketing, client relationship management and staffing.
Jason joined CODA Markets in 2015. As the Director of Execution Services, Jason builds and maintains CODA’s custom routing strategies and downstream relationships. Jason is also actively involved in the Security Trader’s Association of Chicago as the current Vice President and founder of the Young Professionals group for students and industry professionals under 30. Jason studied Finance and Economics at Colorado State University and DePaul University. Outside of work, Jason likes to hunt, fish, and other outside activities. He holds FINRA Series 7, 24, and 66 licenses.
Upon joining CODA 12 years ago, Joe has been at the forefront of the ATS’s auction products, such as CODA Fuse, while enabling customizable trading solutions for all customers. Bringing with him his previous equities experience in both buyside and sellside roles, Joe drives innovation at the CODA Markets ATS with his understanding of market dynamics and a passion for leveraging technology to strive for best execution. Joe received his Bachelor of Economics and Finance degree from Loyola University in New Orleans. Outside of work, Joe enjoys playing hockey, tending to his chickens, and spending time with his family. He holds FINRA Series 7, 99, and 63 licenses.
Zack is Head of Sales for CODA Markets, managing a team focused on obtaining new business and maintaining strong relationships with our existing client community. Prior to joining CODA, Zack spent a decade at a similar firm as Head of Execution Services after cutting his teeth in enterprise datacenter solutions at Dell. Electronic Trading was a natural fit after years of implementing robust systems, networks, and redundancy plans while at Dell. Working from New York and Los Angeles, Zack likes getting to know our clients, on both coasts, through various activities outside of work. He earned a degree from James Madison University in International Affairs and Spanish. Outside of work, Zack can be found at the beach, hiking with my family, or watching just about any sport. He holds FINRA Series 7, 57, 63, 24 and 99 licenses.