This video can be viewed at the below link.[1]

What does the history of measurements have to do with the stock market?

Any football fan knows how important a yard is. But did you know that the definition of a yard has changed over time?

Nine-hundred years ago, an English King named Henry I decreed that a yard was the distance from the tip of his nose to the end of his thumb. Centuries later, yards—and other units of measurement—have been updated to make units consistent and distances comparable.

Well, we use various measurements in our stock markets as well. It has been 17 years, however, since we last updated a number of the key standards and key measurements in our markets. 

Thus, this past December, we proposed several changes to our markets’ measuring system.

First, the proposal would update minimum price increments, known as tick sizes.

You see, currently, a large percent of trading is done not in the lit markets, but in what’s known as the dark markets. Dark market participants trade using smaller increments—smaller tick size—than on the lit exchanges.

This lack of comparability and harmonization—different standards for different markets—now that might undermine competition. And that, I believe, harms everyday investors like you.

Our proposal would harmonize and apply tick sizes consistently across venues and across trading and quoting, to level the playing field between these markets—dark and lit. And further, the proposal would narrow the minimum tick size itself. As of right now, it’s one penny. But in our modern markets—fast-trading electronic markets—that can be updated as well.

Second, reflecting changes in trading volume and technology, our proposal would lower the fees charged by exchanges to access those exchanges by investors. It would make those fees more transparent as well. This may help reduce conflicts in the markets that could favor high-volume traders over everyday investors like yourself.

And third, the proposal would implement a modernized, more-flexible definition of what’s called round lots. Now today, that’s defined as 100 shares, and that’s been around for over 120 years. Probably time to update that.

Lastly, the proposal would also implement changes to make quotes of smaller round lots—so-called odd-lots—more transparent, more available to the market.

These changes, I believe, would make our markets more efficient, competitive, and fair.

Now that’s progress you can measure: from the tip of your nose to the end of your thumb.