Large Trader Reporting
Large Trader Reporting, established under SEC Rule 13h-1, requires any person or entity whose transactions in exchange-listed securities equal or exceed two million shares or $20 million on any single day, or 20 million shares or $200 million during any calendar month, to register with the SEC as a large trader and to facilitate the SEC's ability to obtain transaction data for surveillance and investigation purposes.
The ability to rapidly identify the trading activity of significant market participants is central to effective market surveillance. Prior to Rule 13h-1, which became effective in 2012, the SEC lacked a systematic mechanism to quickly identify large traders during market disruptions and investigations. The 2010 Flash Crash again served as a catalyst, exposing the difficulty regulators faced in identifying and contacting large market participants during the event.
Under the rule, a large trader must file Form 13H with the SEC, providing identifying information about the trader and its affiliates, as well as a description of its business and the accounts through which it conducts large-trader activity. After filing, the SEC assigns the large trader a unique Large Trader Identification Number (LTID), which the trader must disclose to its registered broker-dealers.
Broker-dealers that receive LTIDs from customers are required to maintain records of transactions in exchange-listed securities associated with each LTID and to report this data to the SEC upon request within specified timeframes — typically the next business day or, for urgent requests, on the same day. This reporting requirement enables the SEC to rapidly reconstruct the trading activity of significant market participants during investigations of market disruptions, potential manipulation, or other regulatory events.
The registration obligation is self-executing based on trading volume thresholds. A market participant that has not previously registered must file Form 13H within 10 days of the end of a calendar quarter in which it first met the large trader threshold. Registered large traders must also file annual amendments confirming the accuracy of their registration information and promptly amend their filings following material changes in their operations.
For hedge funds, proprietary trading firms, and institutional asset managers, large trader registration is a routine compliance obligation. Compliance teams must monitor trading volumes against the registration thresholds across all accounts and legal entities, coordinate LTID disclosure to broker-dealers, and ensure that annual amendments are timely filed. Failure to register, or failure to notify broker-dealers of an LTID, can result in SEC enforcement action.
Large trader data collected under Rule 13h-1 complements the Consolidated Audit Trail by providing a registration framework that links trading activity to identified legal entities and individuals, supporting the SEC's broader market surveillance infrastructure.