A program developed by the National Association of Securities Dealers (NASD) which allows for the reporting of over-the-counter (OTC) transactions pertaining to eligible fixed-income securities. Brokers, who are NASD members and deal with specific fixed-income securities, are required to report their transactions by Securities and Exchange Commission (SEC) rules.
Investopedia Says:
From 1998-2001, the SEC approved rules adopted by the NASD regarding the transactions in all U.S. corporate bonds and secondary OTC fixed-income transactions. These rules were developed to bring greater price transparency to bond markets. Subsequently, TRACE was brought into play in 2002 to comply with the newly approved rules. The program replaced the previous Fixed Income Pricing System (FIPS) used since 1994.
Related Links:
How do you find the right broker for your investment needs? Start by reading our broker tutorial. Brokers and Online Trading
Find out how this regulatory body protects the rights of investors. Policing The Securities Market: An Overview Of The SEC
Find out how fixed-income investments evolved in the past century and what it means today. The Bond Market: A Look Back




