October 27, 2012
I see the headline and did not see the whole article.
I write as a cautionary note that reversing to fractions would reduce market efficiency and possibly destroy the ETF industry.
ETF's, needing to buy and sell every day would be forced to pay these higher spreads. This would TAX ETF's and stop them from tracking the underlying index. The result would be to disadvantage large numbers of small investors who use ETF's to bypass dealers.
I do not know what prompts SEC to consider a return to fractions, but the net result cannot be good for small investors. The spread will be paid and small investors will pay the most.
Reversion to fractions also helps feed the belief that american markets are rigged to profit insiders to the detriment of the public.
If the intent is to dampen high frequency trading this is not the way to do it. The high frequency traders will simply be out to capture spreads from any and all comers. Sort of like a troll.