Zero Plus Tick Rule

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Definition: Zero Plus Tick Rule

It is a same transaction which is executed at same price as that of previous transaction but is at a higher price which is from a different transaction. The uptick rule required that the stock be executed only on the uptick or at the zero tick.

This rule was removed in 2007.


Example

If the trades are executed at R100, R105 and R105, then the last trade is called the ‘zero-uptick’.


It was believed by SEC that the short selling led to stock market crash of 1929 which is why the uptick rule was implemented.

 

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