Market Identifier Code (MIC)

What Is a Market Identifier Code (MIC)?

A market identifier code (MIC) is a four-character code used to distinguish stock markets and other trading exchanges inside global trading and referring to computer systems. The principal letter of any MIC is haphazardly allocated followed by a three-digit alphanumeric code for the market in which a trade happens. Submitters can propose a combination of four characters, yet the Registration Authority remains ultimately responsible for the assignment. Once allocated, a MIC code can't be modified.

The MIC code is utilized to process and clear trades and is being pushed toward global acceptance as the securities industries advance toward straight-through-processing (STP). The London Stock Exchange involves MICs as part of its SEDOL security-recognizing systems, which is an alternative to the U.S.- based CUSIP distinguishing system.

Understanding Market Identifier Code (MIC)

Straight through processing, a conceptual methodology for working on the speed of processing transactions is viewed as the sacred goal of global securities trading. For it to be conceivable, there should be a wealth of reliable codes for the market of beginning, currency, and security identification. The way things are presently, there are several unique systems utilized by various countries and for varying types of securities.

One global standard should arise over the long run, and the entirety of the software and processing systems should back it, making the essential technical changes en route. This interaction will require some investment as securities industries push toward the ultimate goal of an "any security, anyplace, whenever" marketplace.

The International Organization for Standardization (ISO) distributes the MIC rundown of all countries on the second Monday of the month.

How Market Identifier Codes Are Used

MICs have been introduced by ISO as an international standard to recognize markets, trading platforms, and exchanges to consider automated processing of trades. With MICs being utilized as the universal recognizing standard, it very well may be a critical step in carrying straight-through processing nearer to being realized past the concept phase.

There are various types of MICs. A market segment MIC distinguishes a section of one of the elements covered by the code that spends significant time in at least one specific instruments or is regulated in an unexpected way. Market segment MICs were organized for more precision, as indicated by ISO.

For each market segment MIC, there is a parent MIC, otherwise called an operating MIC.

An operating MIC, thusly, recognizes the entity that works an exchange, trading platform, regulated or non-regulated market, or a trade reporting facility in a specific country.

Market organizations can apply for a MIC by presenting a request to the registration authority. Normally, a market segment MIC is produced when demand merits the need to distinguish the segment. Contingent upon the conditions, it can happen that main specific segments of a market receive identification with a market segment MIC.

Features

• A market identifier code (MIC) is utilized to determine stock markets and different exchanges in which securities are traded.
• MICs are utilized as an international, universal standard of identification, with codes defined by the International Organization for Standardization (ISO).
• The code is unique, incorporates four characters, starting with a haphazardly doled out alphanumeric character, trailed by a three-digit code to imply the market, for example, XNAS for the Nasdaq market.