Bloomberg Open Symbology - BSYM (Bloomberg open sources its Security Identifier Universe)

Posted on 25. Feb, 2010 by khader.

A while ago, Bloomberg announced that it is making its proprietary security codes public (http://bsym.bloomberg.com/sym/). I received couple of emails asking what that means. Many news items used the term ‘Open Source’, which was confusing to some. First, let me explain what they are making it open source.

As some of my articles on this blog explain different types of security identifiers used in the market, Bloomberg security identifier is another category. But they have been proprietary. What that means is you can’t use them unless you have purchased Bloomberg Professional or other Bloomberg services. If you are a market data vendor you can’t use them with your data.

Now, Bloomberg created website for public and it is free. Also allows you to use their codes as you need without any licensing. Let me clear it a bit more. They are not giving you any product or software. It is merely a license to use the Ids freely, that’s it!
Does it really matter to a technology professional working for a typical Wall Street firm?

It may not. In fact, now you may have to add this column to your Security Master database if you are already not doing so.

If you are a market data provider, it will be additional selling point for you to add Bloomberg ID to your data.

So, don’t be excited that Bloomberg is giving away something big!

Resources:

BSYM Website - http://bsym.bloomberg.com/sym/ You can search codes by market, security type and also download them in Excel.

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Fixed Income Trading System Architecture Workshop on Sep 26

Posted on 13. Aug, 2009 by khader.

I am planning to start another series of sessions on Trading Platform Architecture. I will start the first session on Sep 26th covering the basics of FI products, players, needs of Broker/dealer and System requirements. For more details and presentation downloads visit Fixed Income Trading System Architecture

I will also be postin some articles on desing challenges, technology choices etc. very soon.

-Khader Vali

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Securities Trade Life Cycle

Posted on 11. Apr, 2009 by khader.

It is important to know the big picture of securities trade life cycle. I have been conducting this little workshop on this topic. This workshop covers the following topics. You can also download the presentation Securities Trade Processing(PPT/PDF).

CONTENTS:

• Introduction
• Brokerage Firm/Securities Trading Organization
• Trade Life Cycle
• Order Origination / Front Office
• Order Validation / Middle Office
• Settlement / Back Office
• Custodians, Commercial Banks
• References

-Khader

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Ticker Symbol of Stocks, Options and Futures - The story behind them.

Posted on 05. Mar, 2009 by khader.

The Ticker Symbol is a common identifier used in financial marktes to identify all trading instruments. The ticker symbols are fromed using certain methods. Knowing those methods would make our job much easier especially if you are dealing with multiple classes instruments. The idea behind this article is to bring all of them together and discuss.

Supporting presentation from one of my classes Capital markets security ids.

What is ticker?
The TICKER term came from the sound of ticker tape machines that were used in stock exchanges a long time ago. These tapes displayed Stock information and each stock is identified by its symbol. Hence the Ticker Symbol.

The common alternate street terms are - Stock Symbol, Ticker Symbol, Trading Symbol, just Symbol or just Ticker.

(You can also download one of my class presentations on this topic.)

Lets see how these symbols are created for each type of instrument.

Stock Symbols:

The Stock symbol may contain two parts. The first part is knows as the root symbol and the second part is an additional information about the company which is explained later below.

Root Symbol: All trading stocks are assigned a root symbol like GE from General Electric. Usually all stocks traded on NYSE have 3 character wide root symbols and NASDAQ listed stocks have four character root symbol. Some examples are - C (Citigroup), WMT (Walmart), INTC (Intel)

Special Code: Sometimes additional information is tagged along with root symbol to represent additional details like the class of Shares, current status of the company etc. I have listed some commonly used special codes below.

NYSE stocks separate this part with a period after root symbol, for example BKS.B for Class B stocks of Berkshier Hathway. The NASDAQ stocks simply append after the root symbol, for example GRVY is ADR of Gravity Ltd.

Option Symbol

The next most traded instruments are options and futures. Lets look at Option ticker symbol notation. The option ticker symbol represents four different things -

• Underlying instrument like stock in case of stock option
• Type of option whether it is Put or Call
• Expiration month
• Strike price

Lets look at the option symbol - MSQJG. In this symbol

• First 3 characters ‘MSQ’ represent the underlying instrument symbol in this case it is Microsoft. This is usually a root symbol of the underlying security. But when stock prices grow out of available letters, additional root symbols will be introduced. in this case Microsoft has two symbols MSQ and MFQ.
• Next letter ‘J’ represents the expiration month and the type of option whether it is call or put. In this example J is for October Call option. There are 24 letters that are used as shown in below table.

Expiration Month Code Table

• The last character is the strike price. it is bit trickier since it is again alphabet instead of number. the following table shows all the possible values for each letter. mostly options striker prices are very close to the current underlying instrument cash prices. based on the current price of the underlying and the corresponding letter is picked up. for example MSFT is trading at $25 the letter Y represents the $27.50 from the table.

Strike Price Code Table

Another point to note that, what happens if the stock split or reverse split happens? Excahnge will change the symbol of the option to represent the accurate strike price of the option.

Futures Ticker Symbol

Futures ticker has basically three parts.
- Underlying asset or the futures market eg: Commodities, Bonds etc 
- Delivery month
- Delivery year

Lets go through it using example - the ticker “CLZ9″ is a futures contract trading on NYMEX.

• The first two letters “CL” represents Symbol of Crude Oil
• The second letter “J” stands for a April delivery
• The “9” stands for the year – 2009.

Another example “SFZ9″ represents the currency futures contract of Swiss Franc with deliver Dec 2009.

Futures Delivery Month Codes are:

Futrues Delivery Month Codes

Some sample futures contract symbols on Chicago Board of Trade (CBOT) are:

• US - U.S. TREASURY BONDS
• TY - 10-YR TREASURY NOTES
• FV - 5-YR TREASURY NOTES
• TU - 2-YR TREASURY NOTES
• FF - 30-DAY FED FUNDS
• DJ - DOW JONES INDUSTRIAL

Just for your information all futures contracts are not available with all months delivery. You can find the current list from Exchange trading the futures contract.

You can download different exchange traded securities list from the following links:

• Download NASDAQ Securities List
• Download NYSE Securities List
• Download AMEX Securities List
• Download CBOE Equity Options Symbol List
• Futures Symbol List Lookup 

Are there Bond Symbols?

Bonds are traded different way than stocks. Bonds are identified using CUSIP (explained in my other blog item).

I hope this was short and simple enough to get some idea. Feel free to send me your feedback.

-Khader Vali

References:

1. NASDAQ Website - http://www.nasdaq.com/
2. NYSE Website - http://www.nyse.com/
3. CBOE Website - http://www.cboe.com/
4. NYMEX Website - http://www.nymex.com/

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Securities Identification Codes: SYMBOL, CUSIP, ISIN, SEDOL, RIC Code

Posted on 22. Feb, 2009 by khader.

I have been thinking of gettting some details of all the security codes together from a while. In this article I have explained some fundamental details of each identifier. These are heavily used in daily life of the technical and nontechnical staff of the financial firms.

List different security Identifier used in financial marktes are:

• SYMBOL
• CUSIP
• ISIN
• SEDOL
• RIC Code

You can also download the presentation on this subject Security Identifiers

SYMBOL / TICKER / TICKER SYBMOL / STOCK SYMBOL

The SYMBOL is another unique identifies used to represent a particular security listed on an exchange or  traded publicly. Very commonly used for trading, market data and other places. All listed securities have  unique ticker symbol.

Some examples are: IBM, MSFT, GE etc.

ISIN

ISIN stands for ”International Securities Identification Number”. It is used to uniquely identifies a security. It is originated from ISO 6166. ISIN is used to identify bonds, commercial paper, equities, warrants and most of the listed derivatives. The ISIN code is a 12 character alphanumerical code.

One distinction is that ISIN code doesn’t change by exchange or currency it trades. It is unique unlike symbol that may change based on exhcnage and currency.

To distinguish the exchange it has the same ISIN on each, though not the same ticker symbol. ISIN cannot specify a particular trading location in this case, and another identifier, typically MIC or the three-letter exchange code, will have to be specified in addition to the ISIN. The SEDOL board of the London Stock Exchange has revised their own standards to address this issue.

Example: LT0000610040

CUSIP

The CUSIP number or simply a CUSIP is another key identifier used finanical marketsm to uniquely identify the company or issuer and the type of security.
CUSIP stands for “Committee on Uniform Securities Identification Procedures”.  The CUSIP number is mainly used for US and Canadian stocks, and US government and municipal bonds.

The CUSIP number is nine characters wide and its a combination of letters and numbers. The first six characters identify the issuer and are assigned in an alphabetical fashion; the seventh and eighth characters identify the type of issue; and the last digit is used as a check digit.

The CUSIP Service Bureau is operated by Standard & Poor’s on behalf of the American Bankers Association (ABA). You can learn more at http://www.cusip.com.

Example: 008000AA7 (more examples)

SEDOL

The SEDOL is used for all securities trading on the London Stock Exchange and other exchanges in the U.K. The SEDOL stands for “Stock Exchange Daily Official List” and it is seven characters wide. It is combination of letters and numbers.

Generally used to identify the UK securities that are not traded in US. Unique code is issued for each market  the security is listed on.  You should also know about MIC that is used to identify Markets(exchanges).

Example: B0WNLY7

RIC Code

The RIC stands for ”Reuters Instrument Code”,used by Reuters to identify financial instruments and indices. The codes are used for looking up information on various Reuters financial information networks.

RIC code is mainly two parts. First part is a symbol and second part is exchange code which is optional. Second part is separated by period.

Example: MSFT.OQ representst the Microsoft on NASDAQ.

Additional Notes:

Sample CUSIPS (Just few details of some of the bonds issued by different corporations are given):

14149YAR9 - Corporate Bond - Cardinal Health Inc
126650BG4 - Corporate Bond -CVS Caremark Corp
254709AC2 - Corporate Bond -Discover Finl Services
437076AQ5 - Corporate Bond -Home Depot Inc
441060AG5 - Corporate Bond -Hospira Inc
50075NAN4 - Corporate Bond -Kraft Foods Inc
574599BE5 - Corporate Bond -Masco Corp
617446B99 - Corporate Bond -Morgan Stanley
637640AC7 - Corporate Bond -Natl Semicon Corp
713291AL6 - Corporate Bond -Pepco Hldgs Inc
852061AE0 - Corporate Bond -Sprint Nextel Corp
887317AA3 - Corporate Bond -Time Warner Inc
925524BF6 - Corporate Bond -Viacom
125509BG3 - Corporate Bond -Cigna Corp
125896AV2 - Corporate Bond -CMS Engy Corp

References

• CUSIP home page
• SEDOL Details From LSE
• MIC List
• NASDAQ Website http://www.nasdaq.com
• NYSE Website - http://www.nyse.com/
• CBOE Website - http://www.cboe.com/
• NYMEX Website - http://www.nymex.com

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My FIX Protocol Videos on YouTube, finally!

Posted on 16. Feb, 2009 by khader.

Finally, I could post my FIX Protocol introduction videos on YouTube. The video is in 4 parts each around 7-10 min long. I tried my best to cover the complete introduction. You can download the presentation here (PPT/PDF). I hope any one who is new to the subject can easily get the whole big picture. Please feel free to post your comments.

The links to videos are:

You can also check my FAQs page on FIX Protocol.

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Market Data - Ticks - Uptick - Downtick

Posted on 08. Feb, 2009 by khader.

I just wanted to clarify few basic terms that are used very often to indicate market movements.

• Plustick/Uptick
  Security is Trading at higher than the previous sale price
• Minustick/Downtick
  Security is trading at lower than the previous sale price
• Zero plustick
  Security is trading at same as last sale price but previous tick was a plustick

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Financial Markets & Products - Introduction

Posted on 06. Feb, 2009 by khader.

One day workshop

Covers fundamental elements of Financial markets and products. Topics like:

• Overview of Financial markets
• Players and Structure of Financial markets
  • Buy Side Firms
  • Sell Side Firms
  • Exchanges
  • Regulatory Bodies (SEC)
  • Clearing Firms, Commercial banks
• Categories of financial products
  • Equities
  • Fixed Income
  • Options & Futures
  • Other Derivatives
• Regulatory agencies and their role
  • Securities Exchange Commission
  • Self regulatory Agencies (NYSE etc)

Download class presentation (ppt/pdf) : insidefinmkts_ksv_full

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FIX Protocol Training

Posted on 01. Feb, 2009 by khader.

As I promised, another one day FIX workshop will be conducted on Feb 15 ‘09. This is going to be one day course from 10AM to 4PM. (You can also watch my FIX Protocol video on YouTube)

I will be covering the following topics:

Part - 1 (Download Material -PDF)
FIX Protocol Introduction

• Overview
• History
• Usage / Players
• Message Types
• Message Format
• Communication Model
• Anatomy of sample message
• Sample Flow
• Undestandng Specs

Part - 2
FIX Protocol & Equity Trading

• Electronic Trading Overview
• Types of FIX Messages
• Trading Scenarios

Part - 3
Technical Implementation

• Architecture
• Buy-side Vs Sell-Side
• Integration Methods
• Commercial Engines
• Free Engines
• Implementation Steps
• Testing Tips
• Troubleshooting Production Issues
• Roles & Responsibilities

You can download class presentation FIX Class PDF.

Visit the Course page for more details and schedule for dates.

FIX Engines & Usage

Application Integration Options

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‘Short End’ and ‘Long End’ of the Yield Curve

Posted on 21. Dec, 2008 by khader.

These are some of the informal terms used. Usually Yield Curve is formed with two sets of Maturities. They are -

1. Short Term Rates with maturities less than year
(1d (1 Day), 2d, 3d, 1w (1 Week), 1m (1 Month), 2m, 3m, 6m, 1y (or 12m) )

2. Long Term Rates with maturities more than year
(2y, 5y, 10y, 15y, 30y)

Curve that represents upto 1 year is known as ‘Short End’ of the curve and the curve that represents long term rates is known as ‘Long End’ of the curve.

These terms are also used with any forward rate curve.

Just to add, the following are the common Yield Curves -
- Treasury Yield Curve
- LIBOR Curve
- Corporates

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