December 13, 2015
SEC,
As an investor, I feel it is important that the IEX exchange application be approved. There are unfair advantages and practices in our current markets that IEX can help to mitigate for the average investor.
There are many common sense reasons for approving IEX as an exchange (NBBO regulations are being ignored, Direct Feeds are gaming the SIP, failure to provide automatic quotes that don't expire before they reach the West Coast, etc, etc).
However, the most important reason for myself and many other investors is to simply have the opportunity to have my orders executed in a fair market environment.
By granting IEX exchange status with protected quotes, I can avoid sending my orders into a market where high speed traders have enormous unfair advantages over me when it comes to execution quality.
Not only that, but to make it easier for them to take advantage of me, identifiers are actually attached to my orders signaling that they are retail orders (this happens on all the main exchanges currently (NAS, NYSE, BATS).
Why is this even allowed?
The only plausible reason is so that these exchanges know who to take advantage of. It's disgraceful.
Additionally, I prefer to use the IEX Router (if I could afford to build my own, I would) because it helps me avoid one of the most damaging elements of our current markets: Latency Arbitrage.
The current market system is clearly and deliberately set up to allow this practice which adds nothing to market quality and undermines its very stability.
How Latency Arbitrage is not illegal is still a mystery to me and many, many others.
Approving the IEX exchange application will keep my orders away from predatory traders and provide the fairness that is so lacking in today's markets.
Thank you for your time.
Joseph Warren