What is prohibited according to New York Stock Exchange rules?

Prearranged trades are prohibited according to New York Stock Exchange rules because they undermine the integrity of the market. A prearranged trade occurs when two or more parties agree in advance on the terms of a trade and subsequently execute it as if it were a legitimate transaction in the market. This practice can create a false appearance of market activity or manipulate prices without the natural supply and demand dynamics at play. Prohibiting such trades helps to ensure that all market participants have a fair opportunity and that the market operates transparently and efficiently.

The focus on maintaining an open and honest trading environment is crucial for protecting investors and ensuring that the market remains a reliable platform for the exchange of securities. In contrast, executing customer orders, trading during off-hours, and promoting IPOs, while regulated, do not carry the same level of risk in terms of market manipulation.