Decimalization

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Imported from previous forum

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[ original email was from Andrew Kagan - akagan@optimark.com ]
Are there any FIX-specific implications for the industry conversion to decimal pricing? I have reviewed the FIX 4.2 specification and found no specific mention of the impending change.

Thank you.

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[ original email was from Ryan Pierce - rpierce@taltrade.com ]
> Are there any FIX-specific implications for the industry conversion to decimal pricing? I have reviewed the FIX 4.2 specification and found no specific mention of the impending change.

The FIX protocol is, and always has been, "decimalization-compliant" in that it represents all prices over the wire as decimals, not fractions.

Now this does not mean that all FIX implementations and order management systems are "decimalization-compliant." For instance, prices may be represented internally in some systems in fractional form, and converted to/from decimal for transmission via FIX. Alternately, a decimal system may impose "minimum price variations" in decimal but use the wrong value, i.e. making sure things are divisible by 0.0625 (1/16) or 0.00390625 (1/256) when they should be checking for 0.01 price variations for decimalized stocks.

Note that these are implementation issues, NOT issues with the FIX protocol itself. Many non-US markets have been trading in decimals for quite some time now, and FIX has captured quite a bit of international use in these markets.