Advancing the bid (decreasing the offer)

Definition

entering orders to trade which increase the bid (or decrease the offer) for a financial instrument, related spot commodity contract, or an auctioned product based on emission allowances, in order to increase (or decrease) its price. Advancing the bid (decreasing the offer) may also be illustrated by orders to trade inserted with such a price that they increase the bid or decrease the offer, and have the effect, or are likely to have the effect, of increasing or decreasing the price of a related financial instrument.

Surveillance

Effective implementation of surveillance alerts for advancing the bid (decreasing the offer) requires capturing the following trade data:

  • order and quote data including unexecuted quotes and orders

  • trade data

Order to trade ratio may be used in detection of advancing the bid (decreasing the offer) behaviour. Advancing the bid (decreasing the offer) is the special case of placing orders with not intention of executing them.

Regulatory source

Entering orders to trade which increase the bid (or decrease the offer) for a financial instrument, related spot commodity contract, or an auctioned product based on emission allowances, in order to increase (or decrease) its price — usually known as ‘advancing the bid’. This practice may also be illustrated by the indicator set out in Point 6(a)(i) of this Section;

COMMISSION DELEGATED REGULATION (EU) 2016/522, Annex II, Section I, 6 (d)