For any American stock exchange (NYSE, AMEX or Nasdaq), can equities trading below $1 be traded at fractions of a penny and stocks trading > $1 must trade in penny increments?
my understanding is both above and below $1 can be traded down to a fraction of a cent. I have bought some at the fourth digit to the right of the decimal point, for instance 32.8899. Just my experience
Stock Bids and offers above $1 and priced in subpenny increments cannot be accepted from retail customers due to SEC's Rule 612. Trading can be done by a broker/dealer in subpenny increments. See http://defendtrading.com for more info
Interesting Tommintj. Why then can I buy positions with the fourth decimal point? For instance today I did a market order for C and bought it at 4.8485. I didnt do a limit order(when I do a limit order it wont let me enter more than 2 decimal spots), and that 4.8485 is what the market let me buy it at. Im not trying to "i told you so", and I interested if that is the rule then what is the reasoning as to why did I get to buy to the 4th decimal spot?
So I think tommintj is right as far as I can tell. Does it then stand to reason that a stock trading just above $1 is the least efficient market? The spread is nearly a full % point.