Request for quote
A Request for Quote (RfQ) is a request for a . A RFQ contains at least the ISIN to uniquely identify the financial product, the type (buy/ sell), the amount, a currency, and the volume (
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Background
In the wake of the 2007-09 financial crisis there was an initiative to create more pre-trade transparency, for which it is essential to know who is requesting which financial product.
Article 1(2) of the Commission Delegated Regulation (EU) 2017/583 of 14 July 2016 (which supplements Regulation (EU) No 600/2014 of the European Parliament and of the council on markets in financial instruments) defines:
A request-for-quote (RfQ) system is a trading system where the following conditions are met:
- a quote or quotes by a member or participant are provided in response to a request for a quote submitted by one or more other members or participants;
- the quote is executable exclusively by the requesting member or participant;
- the requesting member or market participant may conclude a transaction by accepting the quote or quotes provided to it on request.
This essentially means, that everybody buying or selling stocks, bonds, foreign exchange, commodities or exchange-traded funds (ETFs) will (automatically) generate an RfQ before the trade is settled.
Sources and credits
This article is adapted from the Wikipedia article “Request for quote”, written by its contributors and licensed under CC BY-SA 4.0. Fathomly has changed the layout, removed citation markers, navigation and maintenance notices, and adjusted punctuation. This adapted version is shared under the same license. For references, see the original article.
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