Pre-Allocations

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Imported from previous forum

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In the FIX 4.2 New Order - Single message, it is now possible to pre-allocate the order.

What is the intended use of the pre-allocations in the new order message? Is it primarily for markets that require certain types of trades to be pre-allocated? What are some examples
of markets where pre-allocation is required? Is there a complete list of those markets anywhere? What happens in markets that require pre-allocation when the order is only partially
executed? In markets that require pre-allocation, what ability does the buyside have to amend the allocation?

When the order is pre-allocated, how does FIX allow for modification? Is it require to send an amend to the original order? Is it possible to send an Allocation message with
AllocTransType = replace and RefAllocID = order ClOrdID? Unfortunately, there is no id for the pre-allocation within the order that would allow a reference to the allocation but
not the whole order. Is the best way to amend the pre-allocation to get on the phone and amend the allocation verbally?

Thanks,

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Note prior to FIX 4.2, you could specify a single Account. FIX 4.2 introduced the ability to specify a repeating group of AllocAccount values and the AllocShares for each. There are certain markets and types of securities where pre-allocation is a requirement. Note that sometimes the rules for this differ depending upon where the account is domiciled. Some examples of pre-allocation required are: US Futures (e.g. S&P 500 Futures), Korea, Taiwan, Egypt, and Poland. I believe Brazil and Japan have pre-alloc requirements for domestic accounts.

In addition, many firms which send lists/program trades/baskets often pre-alloc at time of list submission to avoid performing post-trade allocation.

>
> In the FIX 4.2 New Order - Single message, it is now possible to pre-allocate the order.
>
> What is the intended use of the pre-allocations in the new order message? Is it primarily for markets that require certain types of trades to be pre-allocated? What are some examples
> of markets where pre-allocation is required? Is there a complete list of those markets anywhere? What happens in markets that require pre-allocation when the order is only partially
> executed? In markets that require pre-allocation, what ability does the buyside have to amend the allocation?
>
> When the order is pre-allocated, how does FIX allow for modification? Is it require to send an amend to the original order? Is it possible to send an Allocation message with
> AllocTransType = replace and RefAllocID = order ClOrdID? Unfortunately, there is no id for the pre-allocation within the order that would allow a reference to the allocation but
> not the whole order. Is the best way to amend the pre-allocation to get on the phone and amend the allocation verbally?
>
> Thanks,
>