Order issuance

The genesis of any trade execution is of course the order itself. By entering an order, a trader orders the Exchange System to buy or sell a certain number of securities. He or she may determine a limit or leave the pricing to the market by entering the order into the order-driven part of the Exchange System as a market order.

Orders that lack certain details or contain improper information (attributes) are automatically rejected by the Exchange System (see Point 9.4 RB; Directive 3 - Trading).

It is the task of the trader, based on the information available and in keeping with the client's instructions, to decide on the appropriate time to enter the order and, under circumstances, to set a reasonable price limit. Neither the Trading System nor the Exchange System investigates whether an order is executable or not, or whether it is logical in view of current market conditions (see Art 11 SESTA - disclosure, diligence and loyalty obligations).

In the case of an execution that deviates considerably from the going market price or was not concluded in a fair and orderly manner, Scoach Switzerland Ltd. has the right to intervene and declare the trade null and void (see Point 10.5 ff. RB)

 Identification and designation of activities

Only those traders are admitted to Exchange trading who assume full responsibility for all actions they take by means of the SIX Platform. Among other things, each such action is documented by:

• an identifier of the given trader and participant institution
• a precise date and time stamp
• a distinct order identifier for each day (Order-ID)
• and, in the case of an execution (trade) by a distinct Trade-ID.

 Information required upon order entry

Aside from various details pertaining to the specific order (e.g. size, price and type of price, period of validity, type of order, etc.), it must be disclosed to the Exchange at the time of entry whether the order is being executed for the participant's proprietary trading account (nostro trade / principal trade) or on behalf of a client (riskless principal). This information is treated confidentially and not divulged to other participants or the public in general.

 SIX Swiss Exchange Trading Guide

All up-to-date information pertaining to product specifications and the organisation of trading are published in the "SIX Swiss Exchange Guides".

To achieve the highest possible degree of liquidity in the market, participants are subject to a relative obligation to trade on the Exchange (Point 4.5 ff. HR, Directive 3 - Annex A, Point 3). 
In other words, during official trading hours, participants are obligated to transact all buy and sell orders via the automated execution system (order book) of the SIX Swiss Exchange's Trading System ("on-order book trading"). All such transactions must be shown on the client invoice as having been executed on-Exchange.

During trading hours a duty to trade on the Exchange applies for individual orders in Scoach-traded products with a market value below CHF 100’000 or aggregated orders with a value below CHF 1’000’000. These limits apply to orders in foreign currency as well, while the market price of these orders shall correspond to the relevant equivalent value in CHF. 

Orders with a market value at or above these limits may be executed off-order book, whereas all transactions that have not been concluded via the automated order book may not be designated as having been executed on-order book.

During the pre-opening, it is permissible to execute orders off-order book below the mandatory Exchange limit.

Although the pricing of off-order book trades is not arrived at by means of the automated order book, such orders must be transacted in keeping with the principle of "best execution", i.e. an off-order book transaction must, as compared to the results that could reasonably be expected from an on-order book trade, always be executed to the advantage of the client(s) involved.

During official trading hours, the off-order book execution of orders that are below the mandatory Exchange limit is deemed to be a violation of the duty to trade on the Exchange.

To ensure a due and proper degree of market transparency, a reporting requirement (Art. 15 SESTA, Art. 6 SESTO-FINMA) exists for all on- and off-order book transactions executed domestically or abroad in securities that are listed on the SIX Swiss Exchange. 

For transactions that are executed via the Exchange System, the relevant report is generated automatically. Off-order book trades, on the other hand, must be reported to the Exchange within 3 minutes of their execution, together with all the required details. These transactions are automatically disclosed to all participants by means of the "Trade Ticker" or "Trade History" functional features. 

Off order book trades that are generated after close of trading must be reported before start of trading on the next trading day.

As a logical extension of participants' duty to trade on the Exchange, the Scoach Schweiz itself is obligated to make public all information necessary to ensure the transparency of securities trading. 

This publication requirement applies namely to price-related information (bid, ask and last-paid prices) pertaining to the traded securities, as well as to details on the on- and off-order book trading volume of those securities (Art. 5 para 3 SESTA). 

The law contains no specific provisions as to the manner and timing of such publication. At present, the Trading System supplies SIX Swiss Exchange participants with real-time price and volume information on all listed securities. Moreover, SIX Swiss Exchange makes that information available to the general public via additional electronic media. 

The latter task is accomplished by SIX Exfeed, a wholly owned subsidiary of the SIX Swiss Exchange. Via the so-called SMF (Swiss Market Feed), SIX Exfeed consolidates all trading-related data generated in SIX Swiss Exchange dealings and disseminates that information to outside vendors of financial information such as Telekurs, Reuters, Bloomberg, etc. 

The following information becomes available as a result of Exchange trading:

• Last-paid on-order book prices, together with volume readings and execution times (continual transmission)
• Best bid and ask prices and the related size (cumulative, continual)
• Cumulative daily trading volume (on- and off-order book volume), whereas on-order book volume is disseminated continually while off-order book volume is updated once a day
• The trading periods as well as any interventions on the part of the Exchange (e.g. the suspension of trading in a given security)
• Order book status ("Trading", "Pre-Opening", "Stop Trading", "Suspended", "Break", "Between Auctions")
• market depth with the best bid and ask prices