Oct. 26, 2022
Good morning, I write in reference to the proposed rule 13f-2 with a perspective which may be slightly unusual. I am an international investor with a small holding in several stocks as well as one fairly sizeable (for me) holding in a former employer, all on US exchanges. I’m not a huge investor but at the same time US stocks do make up a reasonable proportion of my net worth. I am actively considering whether this is wise. I feel some nervousness around the acknowledged existence of so-called ‘dark pools’ where large numbers of shares are traded without that volume being posted to the public exchanges. As such, there is considerable skepticism in certain circles whether prices on the public exchanges are actually fair and accurate. In the light of these circumstances, increased transparency around real short positions held by brokers seems like a step in the right direction. Anything which gives fair and accurate information to allow informed decisions to be taken seems worthwhile. Obscuring that information would seem undesirable and counter-productive to true price discovery, no matter how convenient and profitable it might be for corporate market participants. I do not doubt that there is strong lobbying from companies who wish to keep their short positions secret, but I would request that you keep in mind that the market as a whole should be free and fair. In addition to 13f-2, I would urge you to more strictly enforce the existing sanctions on failing to locate shares sold short. The current fines appear inadequate and a more punitive approach may be required to secure compliance with the rules. The US markets give the impression of being very lightly regulated and what regulations there are, are not strictly enforced. I would suggest that this is not a good impression to project to the world, if you want to continue to attract overseas investors. Yours faithfully, Bruce Barrow 86 Kings Rd Fleet GU51 3AP United Kingdom Sent from my iPhone