TRACE Markup/Markdown Analysis Report

The TRACE Markup/Markdown Analysis Report is a monthly report designed to assist firms in their supervision activities by providing transparency into a portion of FINRA's surveillance program of corporate and agency fixed income transactions customer pricing.

The TRACE Markup/Markdown Analysis Report is built upon logic developed to pair purchase and sale transactions reported to TRACE.

These pairs can be single trade events or multi trade events within the same trading day. Single trade event pairs involve one purchase and one sale trade report. Multi trade event pairs will have multiple transactions associated with the purchase or sale (for example the firm may obtain a large block of bonds that are sold to multiple customers).
Since not every customer transaction will result in a pair being created, unpaired transactions are excluded from this report.

FINRA analyzes all transactions to create the following pairs:

Markup Pairs - Situations where a firm purchases a fixed income security from another firm and then sells the same security to customer.
Markdown Pairs - Situations where a firm purchases a fixed income security from a customer and then sells the same security to another firm.
Customer-to-Customer Pairs - Situations where a firm purchases a fixed income security from a customer and then sells the same security to another customer.

Firms have the ability to refine the analysis based on a number of factors. Specifically the TRACE Markup/Markdown Analysis Report allows firms to refine the report based on the following criteria:

Length of Time to Maturity - This filter allows the user to include only securities that are within the defined time period before the security reaches maturity.
Rating - This filter allows the user to include all securities, investment grade, non-investment grade, or unrated.
Product- This filter allows the user to select the analysis for corporate bonds or agency debentures.

The analysis does not take into account a number of factors that may influence the calculation of the markup (e.g., market movements, affiliated relationships, or variety of services offered). Unlike some of the other report cards on the FINRA Report Center, the analysis provides firms with an overview of how their pricing of customer trades relates to the industry as a whole. The information provided does not contain specific transactions where a violation of FINRA Rule 2121 may have occurred.

Term	Definition
Firm
Dollar Traded Amount	The total dollar value of the bonds traded in a pair. Note: When a one to many pairing occurs, the dollar value of each customer trade is included individually.
Number of Trades Evaluated	A count of the number of customer trades evaluated based on the criteria utilized. Note: When a one to many pairing occurs, this results in a count for each customer trade included in the pairing.
Mean	The average calculated markup or markdown or customer-to-customer percentage for all of the pairs (sum of the markup/markdown/customer-to-customer divided by the number or pairs). Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
Median	The middle value of the calculated markup or markdown or customer-to-customer percentage for all of the pairs. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
Industry
Mean	The average calculated markup or markdown or customer-to-customer percentage for all of the pairs (sum of the markup/markdown/customer-to-customer divided by the number or pairs). Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
Median	The middle value of the calculated markup or markdown or customer-to-customer percentage for all of the pairs. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P25	The calculated markup or markdown or customer-to-customer percentage for the industry where 25% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P50	The calculated markup or markdown or customer-to-customer percentage for the industry where 50% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P75	The calculated markup or markdown or customer-to-customer percentage for the industry where 75% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P80	The calculated markup or markdown or customer-to-customer percentage for the industry where 80% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P90	The calculated markup or markdown or customer-to-customer percentage for the industry where 90% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P95	The calculated markup or markdown or customer-to-customer percentage for the industry where 95% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
P99	The calculated markup or markdown or customer-to-customer percentage for the industry where 99% of all values for FINRA calculated pairs fall below the displayed value. Note: Pairs with calculated markup or markdown or customer-to-customer percentages less than or equal to 0 are not included.
Note about industry values: Industry values are only computed when there are at least 5 pairs for the relevant criteria.

Detail Data

The detail data for the TRACE Markup/Markdown Report allows users to see the pairs that FINRA created.

The following table describes the content and structure of the detail data download file:

Field Name	Definition
Single Trade Events
Event ID	A FINRA created identifier to help uniquely identify the pairing in the monthly report.
Firm	The MPID of the firm whose trade pairs are being evaluated.
Execution Date - Purchase	The trade date of the purchase leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a purchase from a customer or from a broker-dealer.
Execution Time - Purchase	The trade time of the purchase leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a purchase from a customer or from a broker-dealer.
Execution Date - Sale	The trade date of the sale leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a sale to a customer or to a broker-dealer.
Execution Time - Sale	The trade time of the sale leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a sale to a customer or to a broker-dealer.
CUSIP	The industry identifier for the security involved in the subject pair.
Issue Maturity Date	The date on which the principal amount of the security becomes due. Note: Perpetual bonds are identified with maturity dates of 12/31/3999.
Bought From	The contra party for the leg of the transaction where the subject firm has purchased the subject security in the pair identified by FINRA.
Sold To	The contra party for the leg of the transaction where the subject firm has sold the subject security in the pair identified by FINRA.
Bought Volume	The number of bonds in the purchase leg of the transaction in the pair. It is worth noting that some pairs identified by FINRA may not have identical volume for both the bought and sold volume.
Sold Volume	The number of bonds in the sale leg of the transaction in the pair. It is worth noting that some pairs identified by FINRA may not have identical volume for both the bought and sold volume.
Purchase Price	The reported price for the trade for the purchase leg of the transaction in the pair.
Sale Price	The reported price for the trade for the sale leg of the transaction in the pair.
Calculated Percent Profit	The percentage increase (or decrease) in the cost to buy the security and the proceeds from selling the security for the trade pair.
Calculated Dollar Profit	The difference between the cost to buy the security and the proceeds from selling the security for the trade pair.
TRACE Symbol	This is the TRACE symbol of the bond.
Issue Name	The name of the security’s issuer
Multi Trade Events
Event ID	A FINRA created identifier to help uniquely identify the pairing in the monthly report.
Firm	The MPID of the firm whose trade pairs are being evaluated.
Execution Date - Purchase	The trade date of the purchase leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a purchase from a customer or from a broker-dealer.
Execution Time - Purchase	The trade time of the purchase leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a purchase from a customer or from a broker-dealer.
Execution Date - Sale	The trade date of the sale leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a sale to a customer or to a broker-dealer.
Execution Time - Sale	The trade time of the sale leg of the transaction in the pair. Depending on the type of pair (markup, markdown, or customer-to-customer) this may be a sale to a customer or to a broker-dealer.
CUSIP	The industry identifier for the security involved in the subject pair.
Issue Maturity Date	The date on which the principal amount of the security becomes due. Note: Perpetual bonds are identified with maturity dates of 12/31/3999.
Bought From	The contra party for the leg of the transaction where the subject firm has purchased the subject security in the pair identified by FINRA.
Sold To	The contra party for the leg of the transaction where the subject firm has sold the subject security in the pair identified by FINRA.
Volume	The number of bonds in the leg of the transaction in the pair.
Aggregated Volume	The number of bonds in the leg of the transaction for the larger purchase or sale that was paired with multiple other transactions.
Purchase Price	The reported price for the trade for the purchase leg of the transaction in the pair.
Sale Price	The reported price for the trade for the sale leg of the transaction in the pair.
Event Percent Profit	The percentage increase (or decrease) in the cost to buy the security and the proceeds from selling the security for the pair. This value represents the profit for all of the transactions in the pair.
Individual Percent Profit	The percentage increase (or decrease) in the cost to buy the security and the proceeds from selling the security for an individual transaction in the pair.
Event Dollar Profit	The difference between the total cost to buy the security and the proceeds from selling the security for the trade pair. This value represents the profit for all of the transactions in the pair.
Individual Dollar Profit	The difference between the total cost to buy the security and the proceeds from selling the security for an individual transaction in pair
TRACE Symbol	This is the TRACE symbol of the bond.
Issue Name	The name of the security’s issuer.