About SEC Rule 606

Under SEC Rule 606, broker-dealers that route orders on behalf of customers are required to prepare quarterly reports that disclose the following information:

• The percentage of total customer orders that were non-directed orders¹, and the percentages of total non-directed orders1 that were market orders, limit orders, or other orders
• The identity of the venues to which a significant percentage of total non-directed orders were routed for execution
• The percentage of total non-directed orders routed to the venue, and the percentages of total non-directed market orders, non-directed limit orders, and non-directed other orders that were routed to the venue
• Terms of the material aspects of the broker-dealer's relationship with each venue identified above, including a description of any arrangement for payment for order flow and any profit-sharing relationship

The reports are to be made public for each calendar quarter and published no later than one month after the end of the quarter. Another piece of this rule requires annual public notification that the detail is available.

Pursuant to the rule, customers can request details, from their investment representative, on the identity of the venue to which the customer's orders were routed for execution in the six months prior to the request, whether the orders were directed, at the customer's request, to a specific venue for execution and the time of the executions, if any, that resulted from those orders. Customers also may request up to six months of this information in hard copy through a representative on all orders for a specific time period and/or on individual securities. The collection period for this information began on July 2, 2001.

The Securities Industry Association has provided information about order disclosure and this rule.

¹ Any order that the customer has not specifically instructed to be routed to a particular venue for execution.

² To display and/or print this document, you must have Adobe Acrobat Reader, which is available for free.

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