Mar. 19, 2023
March 19, 2023
I strongly support the Commission's proposed tick size regime and recommend clear and unambiguous language in the rule structure to avoid any confusion or litigation. It is important to establish a zero or very low fee structure instead of allowing rebates and other inducements in the marketplace, to eliminate the potential for trading for the sake of volume.
Implementing a variable minimum pricing increment model that applies to both quoting and trading of NMS stocks would promote fair and transparent pricing across trading venues. While reducing the access fee caps is a step in the right direction, completely eliminating exchange rebates would further enhance transparency and fairness in the market.
I also recommend accelerating the implementation of the revised round lot definition and odd lot dissemination on the SIP to enhance reporting efficiency and reduce delays. These steps are crucial to regaining public confidence and trust in the market, particularly in light of recent events like the GameStop controversy.
Enforcement matters, and we need higher fines, bigger penalties, and actual consequences. Investors should be willing to support an additional 0.64 cents more per share to avoid being routed through a wholesaler that has been charged over 70 times by the United States government. The price improvement provided by these wholesalers is minimal and not worth the damage they bring to the market.
I fully support the harmonization of tick sizes across all exchanges and recommend no exceptions or vague language. Some exchanges should not be granted an unfair advantage over others, leading to monopolistic control of parts of the market that counteract and eventually kill the positive benefits of competition. The markets are supposed to be fair - so let's make them fair.
It is important to define tick-constrained as broadly as possible, to ensure that everyone trades and provides quotes according to the same rules. I strongly dislike the presence of rebates and other inducements in the marketplace, as they are simply payment for order flow by another name. Fees should be reduced to zero, but .001 will do. No higher.
I support the inclusion of odd-lot information in the SIP, as odd lots are a majority of trades and should have a greater impact on price. We need to ensure that odd lots impact the NBBO and have a concrete effect on both price and brokers' duty of best execution.