MT502 Order to Buy or Sell

When MT502 is used

The MT502 starts the trade initiation and confirmation flow. The instructing party (an investment manager, a bank’s client desk, a fund distributor) sends it to the executing party (a broker, or a fund’s transfer agent or order handling agent). Where permitted it can also go from an executing party straight to a point of execution such as an exchange, and between brokers. The executing party answers with MT509 status messages (order received, rejected, cancelled), may advise executions with an MT513, and confirms the trade with an MT515. Allocation of a block order across funds follows with an MT514, affirmation of the confirmation with an MT517, and the settlement instructions to the custodians with MT540 to MT543.

Order details sit in sequence B (ORDRDET): the direction (22H::BUSE), the payment type (22H::PAYM), the expiry of the order (98a::EXPI), at least one trading party (B2, TRADPRTY), and the security (35B). The order size is either a quantity (36B::ORDR) or a cash amount (19A::ORDR). For a limit or stop order, the price goes in sequence B1 (PRIC) as 90a::LIMI or 90a::STOP, and the type of order and its time limit in 22F::TOOR (for example LMTO limit, MAKT at market) and 22F::TILI (for example GDAY good for the day, GTCA good until cancelled).

Investment funds. Fund distributors and platforms use the MT502 to subscribe (22H::BUSE//SUBS), redeem (REDM) or switch between sub-funds (SWIF for the from leg, SWIT for the to leg, sent as consecutive messages). A fund order is normally a market order at the next net asset value, with no limit price, and is given either in units (36B::ORDR//UNIT) or as a cash amount (19A::ORDR). The order must reach the transfer agent before the fund’s dealing cut-off, or it is dealt at a later NAV. Swift restricts the use of the MT502 for investment funds to the members of its funds closed user group, and on the ISO 20022 side fund orders use the setr messages (see below).

23G gives the function. NEWM is a new order. CANC cancels an order sent earlier: put the SEME of the original in 20C::PREV in sequence A1 and repeat the order details; the executing party answers with an MT509 carrying a cancellation status (25D::CPRC, for example CAND or DEND when the order can no longer be cancelled). REPL replaces an order sent earlier, for example to change the limit price; the answer is an MT509 with a replacement status (25D::RPRC).

Pre-allocation. A block order can carry 22F::PRCO in sequence A to say how the later allocation should treat a partial fill (PROR pro-rata, FULL only when fully dealt, SPEC as given in a linked MT514).

Settlement details (sequence C) are optional in an order. Most brokers settle on standing settlement instructions agreed in advance, and the chain only needs to be in the order when it differs from the standing one.

MT502 format: sequences and fields

Rules worth knowing

• Sequences A and B are mandatory, and B must contain at least one B2 (trading party). A1, B1, B3, C (with C1 to C3), D and E are optional.
• When 23G is CANC or REPL, an A1 occurrence should hold 20C::PREV with the SEME of the order concerned, so that the receiver can find it.
• Give the order size as either 36B::ORDR or 19A::ORDR. On a cancellation, the quantity or amount to cancel goes in 36B::CANC or 19A::CANC.
• Network validated rules link some order fields, for example the type of order and the limit price, and the order and cancellation quantities. Their numbers differ between releases, so search for the error code you receive.
• In the SR 2025 structure, B1 (price) may repeat, for example to give both a limit and a stop price; some older references show it as non-repeating.

MT502 example

Northwind Asset Management (FUNDGB2LXXX) orders its broker (BRKRAEADXXX) to buy 40,000 shares of ZAGTRADER DEMO PJSC on the exchange, as a day order with a limit of AED 4.90. The block is for two of its funds and will be allocated after execution with an MT514.

{1:F01FUNDGB2LAXXX0000000000}{2:I502BRKRAEADXXXXN}{4:
:16R:GENL
:20C::SEME//NW502261020007
:23G:NEWM
:98C::PREP//20261020083000
:22F::TRTR//TRAD
:22F::PRCO//PROR
:16S:GENL
:16R:ORDRDET
:94B::TRAD//EXCH/XDFM
:16R:PRIC
:90B::LIMI//ACTU/AED4,9
:16S:PRIC
:22H::BUSE//BUYI
:22H::PAYM//APMT
:22F::TOOR//LMTO
:22F::TILI//GDAY
:98A::EXPI//20261020
:16R:TRADPRTY
:95P::BUYR//FUNDGB2LXXX
:20C::PROC//BLK-20261020-07
:16S:TRADPRTY
:36B::ORDR//UNIT/40000,
:35B:ISIN AEZAGT000016
ZAGTRADER DEMO PJSC
:16S:ORDRDET
-}

Line by line

No settlement details: the broker settles on the standing settlement instructions it holds for the manager’s funds.

The broker acknowledges with an MT509 (25D::IPRC//PACK), advises the fills with an MT513 and confirms each fund allocation with an MT515.

A fund subscription looks similar: 22H::BUSE//SUBS, 22F::TOOR//MAKT, no B1 price, 36B::ORDR or 19A::ORDR, and the fund share class ISIN in 35B.

All BICs and the ISIN are made up. The ISIN carries a valid check digit.

Common errors and rejects

1. Order rejected: unknown security or account (MT509 REJT)

   The executing party answers with an MT509 carrying 25D::IPRC//REJT and a 24B reason such as DSEC (unknown instrument), SAFE (unknown account) or BUSE (invalid order type). Correct the static data and send a new order with a new reference.

2. Both a quantity and an amount

   An order that gives both 36B::ORDR and 19A::ORDR is ambiguous, and fund platforms reject it. Send one or the other.

3. Limit order without a limit price

   22F::TOOR//LMTO with no 90a::LIMI in sequence B1, or a limit given in the wrong price type (PRCT for shares, ACTU for bonds), cannot be executed as intended. Check the price type against the instrument.

4. Fund order after the dealing cut-off

   A subscription or redemption that arrives after the fund’s cut-off is dealt at the next NAV or rejected, depending on the fund’s rules. 98C::PREP shows when the order was created, but the time that counts is when the transfer agent received it.

5. Cancellation arrives too late (DEND)

   A CANC for an order that is already executed comes back in an MT509 with 25D::CPRC and DEND (cancellation denied). The executed part is then confirmed with an MT515 and must be reversed by a new opposite order if needed.

6. Duplicate order reference (REFE)

   Reusing a SEME for a new order, for example after a rejection, can be rejected as a duplicate with reason REFE. Every order needs a new reference.

MT502 in ISO 20022

For investment funds, Swift’s MT and MX equivalence table (8 May 2024) maps the MT502 funds template to setr.010 (SubscriptionOrder), setr.004 (RedemptionOrder) and setr.013 (SwitchOrder), with setr.011, setr.005 and setr.014 for the matching cancellation requests. Clearstream’s Vestima user guide pairs them the same way: MT502 NEWM to setr.010, setr.004 or setr.013, and MT502 CANC to the cancellation requests.

For other securities the same table lists no ISO 20022 equivalent of the MT502, and it remains in use on FIN. Category 5 was not part of the November 2025 end of coexistence for payments.

Related messages

• MT509Trade Status Message
• MT513Client Advice of Execution
• MT514Trade Allocation Instruction
• MT515Client Confirmation of Purchase or Sale
• MT517Trade Confirmation Affirmation
• MT518Market-Side Securities Trade Confirmation
• MT541Receive Against Payment
• MT543Deliver Against Payment

• From instruction to settled position: MT540-548, sese.023/024/025 and the statements that follow.

Codes used in MT502

• TRAD
• SUBS
• REDM
• CAND

MT502 questions

What is an MT502 message?

A Swift order to buy or sell securities, sent by an investment manager or other instructing party to its broker, or by a fund distributor to a transfer agent to subscribe to or redeem fund units. With 23G CANC or REPL it cancels or replaces an earlier order.

What is the difference between MT502 and MT515?

The MT502 is the order (client to broker). The MT515 is the confirmation of what was executed (broker to client). Status in between, such as order accepted or rejected, comes in an MT509.

How do I cancel an MT502?

Send an MT502 with 23G CANC, the original SEME in 20C::PREV inside sequence A1, and the order details repeated. The executing party answers with an MT509 with 23G CAST and a cancellation status in 25D::CPRC, such as CAND (cancelled) or DEND (denied).

Is the MT502 used for investment funds?

Yes, for subscriptions (SUBS), redemptions (REDM) and switches (SWIF and SWIT), restricted by Swift to members of its funds closed user group. In ISO 20022 the equivalents are setr.010, setr.004 and setr.013.

Is an MT502 a settlement instruction?

No. It is an order to trade. Once the trade is executed and confirmed, each side instructs its custodian with MT540 to MT543 (for example an MT541 for a purchase against payment).