May 27, 2016
From: Robert S. Johnson
Subject: File Number 10-222 Commentary
Dear SEC,
I am submitting this comment in support of IEX's application to become a public exchange, and I urge the SEC to approve IEX's application.
My personal background and perspective for urging the SEC to approve the IEX application is that I am a personal investor, I have a Bachelors of Science degree and a Masters Degree in Computer Science, and I have over 20 years of experience working in Corporate IT positions
for two different Fortune 100 companies.
I feel extremely qualified to understand the High Frequency Traders (HFT) ability to gain
an unfair advantage over individual investors and some institutional investors by front running trades
using technologies such as high speed fiber networks to provide trading response times in microseconds, when comparable response times are not universally available to individual investors and most institutional investors.
HFT traders are preying upon average individual and institutional investors to realize unethical and unfair profits, and the role of the SEC is to protect investors from such unfair practices.
Besides considering and weighing the complexities of technologies such as fiber networks and microsecond response times, the SEC should conduct a simple smell test of current exchange practices: why do existing exchanges pay hundreds of millions of dollars per year for order flows from individual and institutional investors? By any common sense analysis, this smell test identifies the fact that current exchanges are preying upon order flows sent to their exchanges by hundreds of millions of dollars per year, and High Frequency Traders are the enabling party that reap these predatory profits from the capital of ordinary Americans.
The proposed IEX Exchange's speed bump implementation would prevent HFT players from gaining a technology and response time predatory advantage on the order flows of trades from individual and institutional investors. The simplicity of the IEX's speed bump implementation would neutralize the ability of HFT from reaping unfair profits.
The SEC needs to uphold the integrity and fairness of the market for all market participants.
I urge the SEC to vote in favor of IEX's application.
Sincerely,
Robert S. Johnson
Westerville, OH 43082