Global Market Commentary 18 December 2009

Portfolio Strategy



Portfolio Strategy
Ana Avramovic
+ 1 212 325 2438

Whats in a Symbol (or a RIC, or a CUSIP)?


Whats all the Fuss About?
Given the many different ways of identifying a security (tickers, RICs,
Bloomberg codes, SEDOLs, just to name a few), one might thing the sole
purpose were to confuse the hapless trader and keep diligent back office
support busy.
While its true that many of these identifiers may seem redundant, they do, in
fact serve different purposes. Sure, it seems like life would be easier for
everyone involved if we just adopted one single identifier that would uniquely
identify every security on every exchange, worldwide (the identifier that you
already use, of course) but that would create yet one more system to learn.
In fact, as we discuss below, things are never so simple in trading and a
single, fully unique identifier might actually create new problems.
A Method to the Madness
To be fair, the multiple individuals involved in the trading process have slightly
different concerns that make each prefer a slightly different scheme:
A broker needs the ultimate granularity. He must be able to distinguish
between every single security on every single exchange and alternative
trading venue in order to determine which venue will deliver the best
execution.
The trader cares about identifying his particular security in the relevant
market where he plans to trade, but he can leave it to his broker to drill
into the specific venues within than market. He prefers something that
has an intuitive relationship to the company name so it is easier to
remember. Also, he only cares about the security he is trading in his
market, not any related or parent securities in other regions.
Key points
Ever wonder what is the difference
between a CUSIP, a SEDOL and an ISIN?
And why in the world doesnt everyone use
a Bloomberg Code like you?
This report will tell you!
We delve into the exciting world of
common (and not-so-common) identifiers,
such as the ISIN, CUSIP, CINS number,
SEDOL, symbol, Bloomberg code and RIC
code. We describe (with examples):
What they are
When they are used
Shortcomings of each
The syntax
We also highlight special quirks that may
create particular confusion.
Finally, we present a useful page on our
EDGE website that displays a cross-listing
of these various identifiers for stocks in
your portfolio.
The middle & back office tends to use machine codes to automate
much of the work, so they prefer the precision that a string of digits
affords. Furthermore, they are not concerned with whether the shares of
Microsoft were bought on NYSE Arca or Nasdaq or BATS. They only
need to identify that Microsoft stock was involved.
Finally, the custodian requires even less definition. They only need to
identify the company. It doesnt even matter if (for example) Credit
Suisse stock is listed in Zurich and also listed in the US OTC market. It
is all Credit Suisse stock.
As a result, in recognition of these different needs, each identifier is valuable
to specific groups.

Portfolio Strategy




Layers of Labeling
As discussed, identifiers have varying scope, according to the target users:
international, national, trading-venue specific, and even proprietary systems.
National
Exhibit 1: Levels of Uniqueness of Identifiers
Every country has their own unique National Naming Agency that assigns
codes to securities with a primary listing in their region. It is important to
observe that these are assigned based on the primary listing of a security.





Proprietary
Systems

Unique
for all
securities.


Bloomberg
RIC Code

Primary Issue
Same for ALL related listings. Based on Primary Listing only.
ISIN, CUSIP, CINS, VALOREN, other national identifiers
Regional Place of Listing
Unique for each listing place,
but same for all trading venues within listing region.
SEDOL
Trading Venue
For example: the main listing for Credit Suisse stock is in Zurich, but that
same stock is also listed in the US in the OTC market, as well as in Germany
on the Frankfurt and Xetra exchanges.
All of these listings will be assigned the same national identifier, and it will
be issued by the Swiss naming agency.
Even though there are listings in the US and in Germany, the US and
German agencies will not issue national identifiers because those are not
the primary listings.
Unique to every trading venue.
Ticker
Examples of national identifiers are the following:
CUSIP North America
SEDOL United Kingdom
Source: Credit Suisse: Portfolio Strategy
VALOREN Switzerland
WKN / WPK - Germany
The national identifier is used to form an international identifier the ISIN (see
below).
National with International Ambitions
Note that SEDOLs and CUSIPs are slightly different from other national
codes. As discussed in The Next Step: A Single Identifier below, the UK
and North American naming agencies are expanding their scope
internationally in an effort to create a single identifier that works everywhere.
As a result, some securities will have SEDOLs and CUSIPs (or CINS, the
international version of a CUSIP) even when the primary listing is not in the
UK/North America.
International
The International Security Identification Number (ISIN) was designed for the
middle/back office and the clearinghouse to facilitate cross-border
transactions. As such, like the national identifier, it does not distinguish on
which exchange a trade takes place.
The ISIN is formed by combining the appropriate national identifier (based on
the primary listing), with the corresponding country code for that primary
listing. A final check digit is added to the end to ensure integrity in data
transmission.
The ISIN syntax requires a 9-digit national identifier. However, some are less
than 9 digits long (for example, a SEDOL is 7 digits; a WKN/WPK code is 6
digits). In that case, leading zeros are added to get to 9 digits (see Odds &
Ends below for more).
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Exchange-Specific
To /B or (not) to /b
A Note on Share Classes
Adding a Suffix
When companies have multiple classes of common
stock, the classes are distinguished by a suffix
appended to the root symbol. Be aware that this
applies when the classes are all regular common
stock with the same voting rights. 2 examples:
Comcast Corp has 2 share classes but one is a
special class of A shares that are non-
voting. As a result, there is no special suffix.
The shares simply have different root symbols
(CMCSA and CMCSK).
Crawford & Co also has regular Class B
common shares, but the Class A shares are
non-voting. Since the A Class is not regular
common stock, they have different root
symbols (CRDA and CRDB), and no suffix is
necessary.
Unique Syntax
When there are multiple common stock share
classes and an appendix is necessary, each
exchange uses a different syntax. For example,
NYSE and BATS use a period (.), while Nasdaq
uses a slash (/).
Example: Berkshire Hathaway has BRK.A and
BRK.B on NYSE, but BRK/A and BRK/B on
Nasdaq and BATS.
The Proprietary systems, Reuters and Bloomberg,
also treat share classes differently. Bloomberg
tends to use a slash (ex: BRK/B US for Berkshire
Hathaway Class B shares), while the Reuters RIC
codes often employ a dash (ex. BRK-B).
Every exchange has their own symbols to identify all securities traded on their
exchange. Since these symbols (aka tickers) are only unique on that particular
exchange, different exchanges may use the same ticker for different
companies. As an example, in the US, the ticker CSX represents CSX Corp,
but in Germany, CSX is the ticker for Credit Suisse stock.
In the US, it is now common to trade a stock listed on one exchange on
another venue (for example, trading a NYSE-listed stock on Nasdaq). In this
case, the second exchange will often use the symbol from the original listing.
Proprietary
Finally, Bloomberg and Reuters (RIC codes) have created their own
proprietary codes that only apply within their own system. These codes are
always unique among all securities on all exchanges within their system, but
they do not allow the middle/back office and the custodian to recognize when
different securities all correspond to the same primary listing.

Careful: BB & RICs are not Symbols!
Bloomberg and Reuters often try to match their codes with a stocks
exchange symbol, but that is not always possible, as different
exchanges may use the same ticker for different stocks (see the section
on exchange symbols above for an example with CSX).

Moving Towards a Single Identifier
Incredibly, despite the fact that there are so many identifiers, there still does
not exist a single one that fully satisfies the requirements of everyone involved
in the life of a trade. As the table on page 5 shows, each one has a slightly
different scope, or level of uniqueness, with corresponding benefits as well
as limitations.
SEDOLs are close
To resolve this dilemma, several agencies have pushed to create a single
standard. SEDOL is perhaps the leader on this front. While SEDOLs were
originally assigned only to stocks traded on the London Stock Exchange, the
LSE has extended its scope over the past 5 years to provide SEDOL codes to
all instruments listed globally. Coupled with a code for identifying the specific
exchange such as the existing MIC (Market Identification Code) this would
be fully unique among all securities on all exchanges.
But CUSIPs are trying to fill that role as well
The Symbol is Sacred
It used to be the case that one could recognize a
NYSE listing by its 1, 2, or 3 character symbol.
Nasdaq issues had 4.
Times have changed!
Now, in an effort to promote competition and
facilitate moving a listing, companies are allowed to
retain their coveted symbol when switching
markets. In addition, new listings on either
exchange can apply for symbols of 1 to 5
characters.
Not to be outdone by the naming agency across the pond, Standard &
Poors, the North American national naming agency, extended their local
identifier of North American companies (the CUSIP) to foreign issuers.
However, these CINS (CUSIP International Numbering System) numbers still
do not exist for all securities globally. In addition, like a SEDOL, one would
still need to use a CUSIP/CINS code along with a MIC to distinguish a stock
on a particular trading venue.
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Portfolio Strategy




Odds & Ends
The CUSIP Cousin: CINS
While the North American numbering agency,
responsible for assigning CUSIPs, has begun to
issue numbers to foreign issuers as well, they are
technically different identifiers.
The CUSIP is still only assigned to North American
issuers. The ID given to foreign issuers is known as
a CINS number. However, many people ignore this
distinction and refer to both as CUSIPs.
You can recognize if a symbol is actually a CINS
number if the first character is a letter, not a number.


SEDOL Syntax: Leave the Leading Zeros?
A proper SEDOL is 7 digits long. 6 digits are used to identify the issuer and
the seventh digit is a check digit to ensure accuracy in transmitting data.
However, sometimes one encounters a 9-digit SEDOL. Is this a more
complicated issue requiring more digits to ensure uniqueness? Is it a just
mistake? Is it even a SEDOL?
The answers are no, no, and not really.
The SEDOL code is always 7 digits, as stated above. However, the
SEDOL is also used to form the international ISIN number when the issuer
is based in the UK. When plugging the 7-digit SEDOL into the 12-digit
ISIN, 2 leading zeros are attached to the SEDOL.
Some systems also attach the leading zeros to facilitate their own
processing efforts. Padding with zeros ensures that all national identifiers
(such as CUSIPs, VALORENs, WKN/WPK numbers, etc) are a consistent
9 digits.
NEW Multi-ID tools online @ EDGE website
Our website, Edge (www.credit-suisse.com/edge) lets you upload & analyze portfolios, including pre-trade & impact cost
calculations. New enhancements to the Portfolios section let you customize what IDs reports use, and also compare all IDs
for a portfolio. Click here for a report with more detailed instructions.
Edge also has tools to help you analyze pairs, track events, find ETFs & search all Portfolio & Derivatives Strategy reports.
1. Customize Your View
At the bottom of each page in the PORTFOLIOS section is a hot-link to select whatever ID you prefer to see in your
reports. Choose between RICs, Bloomberg codes and SEDOLs

2. Map IDs for Your Portfolio
To view a matrix of all IDs for a portfolio, go to Portfolios > Positions > ID Map tab along the left to access the page.
You can run this report for any portfolio already loaded in your MyLists page.

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APPENDIX I: Putting it All Together

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APPENDIX II: Examples

Trading Place ISIN CUSIP CINS Valoren SEDOL Ticker Bloomberg RIC
Swiss CH0012138530 N/A H3698D419 001213853 7171589 CSGN CSGN VX Equity CSGN.VX
Nasdaq Europe CH0012138530 N/A H3698D419 001213853 7171589 CSGNz CSGN NQ Equity CSGNvx.NQX
BATS Europe CH0012138530 N/A H3698D419 001213853 7171589 CSGNz CSGN EB Equity CSGNvx.BS
Turquoise CH0012138530 N/A H3698D419 001213853 7171589 CSGNz CSGN TQ Equity CSGNvx.TQ
Chi-X CH0012138530 N/A H3698D419 001213853 7171589 CSGNz CSGN IX Equity CSGNvx.CHI
secondary
listing
Germany CH0012138530 N/A H3698D419 001213853 7154706 CSX CSX GR Equity (composite)
CSGN.F (Frankfurt)
CSGN.DE (Xetra)
secondary
listing
US CH0012138530 N/A H3698D419 001213853 B01DF91 CSGKF CSGKF US Equity CSGKF.PK
Credit Suisse Stock
primary
listing




Trading Place ISIN CUSIP CINS Valoren SEDOL Ticker Bloomberg RIC
primary
listing
US US2254011081 225401108 N/A N/A 2159762 CS CS US Equity (composite)
CS (composite)
CS.N (New York)
CS.P (Arca), etc
secondary
listing
Germany US2254011081 225401108 N/A N/A B01KLN8 CSX1 CSX1 GR Equity (composite)
CSGNy.F (Frankfurt)
CSGNy.DE (Xetra)
Credit Suisse ADR





Notes:

ISIN, Valoren, CUSIP, CINS: same for all; based on primary listing only
ISIN for CS stock: combines CH for Swiss primary listing country code + national identifier for Switzerland (the Valoren) +
a final "check" digit
ISIN for ADR combines US for US primary listing country code + national identifier for N America (CUSIP) + "check" digit
SEDOL: Unique to each listing region, but same for all exchanges within that region.
Ticker: Every exchange is independent. May or may not be the same as other exchanges.
The exchange assigns the ticker independently from all other venues.
Happens to be the same on European exchanges for the primary stock listing and on the German exchanges for the
secondary listings.
Bloomberg, RIC Code: Unique for all. Bloomberg has composite codes, Reuters has composite codes for US issues.
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Portfolio Strategy





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