FINRA Rule Amendments Relating to Stop Orders

FINRA announced that the SEC has approved new FINRA Rule 5350 (Stop Orders), which replaces the stop order provisions of FINRA Rule 6140(h). The rule provides that any order labeled as a "stop order" or a "stop limit order" must be triggered based upon a transaction at the stop price, but permits firms to offer alternative order types with different triggers, so long as the order type is not labeled as a stop order and is clearly distinguishable from a stop order.

The text of the rule can be found here.

View FINRA Regulatory Notice 12-50 in full here(links externally to FINRA website).