Aug. 11 at 1:20 PM
$BDGR "The rules mandate the absolute smallest order entry increment allowed for market participants and broker-dealers is
$0.0001 (four decimal places), any trades executed below that, are done by market makers adjusting the number of shares they hold. A retail investor may, periodically, get an order executed below
$0.0001, but that retail investor cannot enter their buy order limit price below
$0.0001
The specific rule is FINRA Rule 6434 for Over-The-Counter (OTC) micro-cap/penny stocks, and SEC Rule 612 of Regulation NMS (commonly known as the "Sub-Penny Rule") for exchange-listed (NMS) stocks.
Key Breakdown of FINRA Rule 6434 (Minimum Pricing Increment for OTC Equity Securities):
Priced under
$1.00: The minimum price increment is
$0.0001. Entering an order priced at five decimal places (e.g.,
$0.00005) or any sub-penny increment below
$0.0001 is explicitly prohibited for retail broker-dealers to accept, rank, or display.
