Automated Confirmation Transaction Service - ACT
Contents
Demystifying Automated Confirmation Transaction (ACT) Service: A Comprehensive Guide
Exploring the Automated Confirmation Transaction (ACT) Service
The Automated Confirmation Transaction (ACT) Service is a vital component of Nasdaq exchanges, facilitating the documentation and reporting of trade clearing activities. It streamlines the process of matching trade information, ensuring accuracy and efficiency in trade settlement. Let's delve into the intricacies of this automated reporting service and its significance in the financial landscape.
Understanding the Role of ACT Services
ACT Services serve as an automated data system designed to document and report trade clearing activities on Nasdaq exchanges. By comparing trade information entered by participants, ACT ensures the accuracy of 'locked-in' trades submitted for clearance and settlement. Moreover, it plays a crucial role in disseminating transaction reports to the National Trade Reporting System, providing transparency to the public and the industry.
Participation and Compliance
Participation in ACT is mandatory for brokers affiliated with clearing agencies registered with the SEC. Market makers must adhere to SEC requirements to access ACT services. Upon application approval, participants gain access to the platform, enabling them to input and validate trade information. Each ACT report contains essential details about the trade, ensuring compliance with regulatory standards.
Evolution and Implementation
The ACT Service replaced the Trade Acceptance and Reconciliation Service (TARS) in 1998, enhancing trade reconciliation and back-office transactions. Built on the INET platform, ACT has become a trusted post-trade technology, supporting over-the-counter (OTC) trade reporting in equity securities for more than two decades. Its integration with the Nasdaq electronic stock market has streamlined trade processing and improved market efficiency.