TACT - Continuous Trading Phase
During the continous trade phase, the third of the TASE trading phases
, trading is bilateral, continuous and simultaneous. Each transaction is executed at the price determined by the intersection of a bid and ask order. There is no price fluctuation limit during the continuous trading phase.
Processing of Orders Submitted during the Continuous Trading Phase
- Each new order received in TACT (Tel-Aviv Continuous Trading) system and is found to be valid, is examined in turn, against the orders in the book, in order to match it to suitable counterparts.
- An order may be changed or cancelled only when it has not been fully matched to a counter order. The cancellation or change will apply only to the quantity that has not yet been met.
- Change of an order is possible only if the quantity in the correcting order plus the quantity executed from the original order, is equal to at least a minimum order size in the continuous trading phase.
- Any change in an order results in the cancellation of the original order and its replacement by a new corrective order. A new order number is assigned to the order in TACT, and its priority is determined according to the rate restriction in the corrective order and the date of execution of the change.
A change in the quantity of an order as a result of partial execution does not cause a change in the execution priority of the remaining part
A change in the quantity of an order as a result of partial execution does not cause a change in the execution priority of the remaining part.
The Order Book and the Process of Matching Orders
The order book during the continuous trading phase is a list of all the orders received that have not yet been matched to their counterparts and have not yet resulted in a transaction. The order queue is managed according to price priority first and time priority second.
Each new order and is examined in turn, against the orders in the book, in order to match it to suitable counterparts. A new order may be matched to one or more orders in the book.
A buy order is matched with sell orders with a limit of less than or equal to the price limit on the purchase order, from the sell order with the lowest rate limit to the sell order with a price limit equal to the limit on the purchase order or until the order is completed.
Creation of a Transaction
The match between two orders creates a transaction, at a price identical to the price limit of the order in the book. An order from the book that was matched in full is erased from the book and registered in the transaction database. If the new order cannot be matched, in full or in part, with an order or orders in the book, the order or the unexecuted part of the order is recorded in the order book.
If the matching of the new order with an order in the book results in a remainder left over from the order in the book, the unexecuted part remains in the order book and keeps the priority level of the original order.
A change in the price of the order causes it to be replaced with a new amended order, whose priority is determined by the price limit of the amended order and the time of the change.
Continuous Trading Phase Parameters
A. Minimal order sizes
Minimum sizes of orders in the continuous trading phase, in equities and convertible bonds are:
- TA-35 shares – shares at a monetary value of NIS 5,000.
- All other shares and convertible bonds – securities at a monetary value of NIS 2,000.
- Warrants – an amount of warrants equal to the minimum amount of shares in an order of the underlying asset, divided by the exercise ratio.
- T-bills – par value 30,000 (the T-bill market is the only market in which the minimum size is noted in par value rather than in monetary value).
- Bonds – Government bonds, issued by the State of Israel and institutional bonds at a monetary value of NIS 30,000.
- In corporate liability certificates and commercial securities - value of NIS 10,000.
B. Maximum rate fluctuation
The maximum price fluctuation in the continuous trading phase is unlimited.
C. Market orders
Matching "market" orders (MKT) is similar to matching "gate" (LMT) commands. If a market order (MKT) is not met or there is a residual that has not been met, the order or the remainder of the order book will be recorded as a "rate" (LMT) order with a price limit equal to the last transaction price.
During the execution of the transactions, the date of submission of the orders is important in determining the transaction price. A transaction rate is determined according to the limit of the rate of the order in the book. In other words, if a sales order is recorded in the book, any counter-purchase order submitted to TACT, whether a market order (MKT) or a "rate" (LMT) order, with a price limit greater than or equal to the limit on the sale order in the book is executed at a rate equal to the price limit of the sell order in the book. Therefore, it is possible that in certain situations, the same orders that are placed in a different order, will determine transactions at different rates.
Processing of Orders that were not Executed during the Continuous Trade Phase
At the end of the continuous trading phase, unexecuted orders are transferred to the closing price phase.
The continuous trading phase is the third of the trading phases. The phases are:
Continuous trading phase