Over-the-counter transactions by 22 sponsors in selected stocks, Jan. 18–26, 1962, and May 21-June 1, 1962-Continued

SOUTHERN NEW ENGLAND TELEPHONE CO.

CHAPTER VIII

TRADING MARKETS-INTERRELATIONSHIPS

A. Introduction.

SUMMARY TABLE OF CONTENTS

B. The Basic Allocation Between Exchanges and Over the Counter (as Primary Markets).

C. Institutional Participation and Block Transactions.

D. Over-the-Counter Markets in Exchange-Listed Securities.

E. Allocation Among Exchanges-The Regional Exchanges as Primary and Secondary Markets.

F. General Considerations.

B. THE

DETAILED TABLE OF CONTENTS

A. INTRODUCTION-SCOPE OF CHAPTER

BASIC ALLOCATION BETWEEN EXCHANGES
AND OVER THE COUNTER (AS PRIMARY MARKETS)

1. The basic dividing lines-The concepts of "listing" and "unlisted
trading privileges" and the significance of exchange restrictions on
members' trading----

2. Roles of various interested parties in market allocation_

3. Factors affecting market allocation...

4. Primary listing and delisting standards of the principal exchanges.-.

5. The distribution of stocks among markets and their trading patterns__ a. Characteristics of stocks..

b. Trading volumes..

6. Special demands of a continuous auction market..

a. The importance of depth..

b. Long-range factors affecting depth_

c. Listing and delisting standards...

d. The round-lot unit_

7. The greater adaptability and variety of over-the-counter markets. 8. Summary, conclusions, and recommendations....

C. INSTITUTIONAL PARTICIPATION AND BLOCK TRANS

ACTIONS

1. The growing importance of institutional investors.

2. Methods of handling block transactions---

a. Listed stocks...

(1) Through the auction market on an exchange.

(3) Through special stock exchange plans.

(a) Distribution plans..

(i) Specialist block purchase. (ii) Exchange distribution

(iii) Special offering.

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(2) Through prearranged crosses on the floor of an ex-
change..

(4) Through special off-board requests.

(5) Through transactions (in listed stocks) in the over-the

3. Analysis of institutional transactions reported through questionnaire
IN-4---

a. Transactions in March 1961 and April 1962 (form A)-
(1) Analysis by type of stock and type of transaction.---.
(a) The proportion of total stock volume repre-
sented by each of the stock categories___.

(b) The proportion of total stock volume repre-
sented by NYSE-listed issues as opposed
to those not so listed..

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(c) The market channels employed for stocks
listed on the NYSE, and for stocks not listed
on the NYSE___

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(d) The relative importance of NYSE stocks in
the institutions' usage of the over-the coun-
ter trading markets and the regional ex-
changes--

(e) Use of special forms of transactions.

(2) Analysis by institutional type..

(3) Analysis by size of individual transaction_.

(4) Analysis by type of order used.

b. Large block transactions in 1961 (form B)..

(1) Analysis by type of stock and type of transaction_

(2) Analysis by institutional type..

(3) Analysis by size of individual transaction_.

(4) Analysis of blocks by size, time, transactions, and brok-
ers used..

c. Transactions in new issues in 1961...

4. Decisionmaking as to handling of block transactions.. a. Procedures..

b. Criteria__

c. Relations with broker-dealers: "reciprocal" business.

5. Portfolio turnover..

6. Recommendations by institutions about the securities markets.. 7. Summary, conclusions, and recommendations...

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a. Trading by the market makers on the exchanges.
b. Exchange members in the over-the-counter market.

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c. The late tape.

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d. Use of the exchanges to effect transactions over the counter

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7. The role of the third market..

a. Effect on depth of primary market...
b. Function as a competitive market.

8. Summary, conclusions, and recommendations-

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