Nasdaq Ditches Pre-Trade Info Hassle for Derivative Securities
Published Date: 10/13/2026
Notice
Summary
Nasdaq is updating Rule 5740 to simplify how it shares info about certain securities with its members. They’re dropping the old rule that required sending info before trading starts and now will provide key details by the time buyers get their first trade confirmation. This change affects traders and companies dealing with UTP Derivative Securities and kicks in right away with no extra costs.
Analyzed Economic Effects
2 provisions identified: 2 benefits, 0 costs, 0 mixed.
Exchange stops pre-trade circulars
Nasdaq deleted Rule 5740(a)(1) so the Exchange no longer must distribute an information circular to Members prior to the commencement of trading in each UTP Derivative Security. Nasdaq says Members can rely on the primary listing exchange's information circulars, which are generally available on the listing market's website.
Written description delivered with first confirmation
Nasdaq amended Rule 5740(a)(2) so that, when required by the listing exchange, the written description of a UTP Derivative Security must be provided in a form approved by the listing exchange or prepared by the issuing open-ended management company no later than the time a confirmation of the first transaction in the series is delivered to the purchaser. Nasdaq will notify Members by information circular that this written description is only required when the listing exchange mandates it.
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