Mar. 31, 2023
- I support this rule as it protects all participants of the market by upholding equality when it comes to executing the best possible trade. - For individual investors who may not understand the complexities of trade execution, best execution is crucial. - Clear guidance should be provided on how to interpret Regulation NMS Rule 605 reports, particularly for retail investors who may not be well-versed in the markets. - While brokers have a duty of Best Execution based on common law agency principles and fiduciary obligations, it needs to become a rule that the SEC can enforce. - A Best Execution rule should not include conflicted orders. Without a Best Execution rule, customers may not be aware of revenue arrangements between brokers and subpar trading firms, leading to higher transaction prices. - Different trading venues may offer different prices, so slower execution can lead to missed opportunities, information leaks can inhibit transactions, and less reliable settlement processes can delay receipt of proceeds. - In December 2020, Robinhood was charged by the SEC with failing to meet its best execution obligation, resulting in a $34.1 million aggregate loss for its customers. - Robinhood made misleading statements and did not disclose payments received for routing trades to specific firms. - Citadel settled best execution charges with the SEC in 2017, paying $22.6 million for executing customer trades at less favorable pricing. - Brokers recommending mutual funds with 12b-1 fees and revenue sharing arrangements with clearing brokers have also faced best execution charges from the SEC. - Quarterly reviews of execution quality would increase transparency and accountability for the practices of broker-dealers. - The proposed rule would provide a more detailed and comprehensive standard for broker-dealers to follow, resulting in consistently robust best execution practices. - The proposed Regulation Best Execution is necessary to protect household investors and promote fair and efficient markets by ensuring that household investors receive the best possible execution for their trades. Virus-free.www.avast.com