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OTC Link Closing Auction
Closing Auction generates a one-of-a-kind, industry standard closing price for over-the-counter equities.
On the OTC Link NQB IDQS platform, OTC Link hosts a closing auction for a specific group of OTC equities, similar to the format commonly seen in the listed equities market.
Closing Auction Order Types:
Limit On Close (LOC)
Market On Close (MOC)
Limit On Close Imbalance Only (IO)
Imbalance Feed: NQB multicast feed will disseminate an Imbalance message that indicates the current state of the closing book.
Full Closing Price Indication
OC/IO Only Closing Price
Current Inside Closing Price
Buy/ Sell Imbalance
Closing Price: Each security that is eligible and executes on the closing auction, prints a price that is disseminated via NQB Link Market Data Feed, via OTC Markets website stock page, csv download and FTP daily after regular market hours.
Unified Price Benchmarking: The auction closing price establishes a reliable benchmark price for end-of-day valuation. This benchmark helps fund managers evaluate how well their investment decisions have performed against the market's closing price.
Visibility Into Order Imbalance: The imbalance feed provides traders and market participants with visibility into the current order imbalances for a security that is going through the closing auction. An order imbalance occurs when there is a difference between the quantity of buy orders and sell orders.
Additional Liquidity: The closing cross mechanism aggregates buy and sell interest, potentially increasing liquidity around the close. This can attract more participants and create a more competitive environment for traders.
Efficient Price Discovery: The imbalance feed contributes to enhanced price discovery during the closing auction. It reflects the supply and demand dynamics at the end of the trading day, helping to determine a more accurate closing price that reflects the market's consensus.
Market Structure Enhancement: Introducing a closing cross order type provides a standardized and structured mechanism for end-of-day trading in the OTC equities market. This aligns with the practices seen in traditional exchanges and adds to the maturity of the market.
OTC Link NQB Data Feed: The data feed includes all imbalance information for the closing auction, starting 10 minutes before the close. The feed also includes the displayable depth for OTC Link NQB (OTCN) orders and OTC Link ECN (OTCX) orders.
