Mar. 31, 2023
I am writing to express my strong support for the Commission's proposed tick size regime and to provide recommendations for further improvements to promote fairness and transparency in the market. To avoid any confusion or litigation, I urge the Commission to use clear and unambiguous language in the rule structure. Instead of allowing rebates and other inducements in the marketplace, a zero or very low fee structure should be established to eliminate trading for the sake of volume. Implementing a variable minimum pricing increment model for both quoting and trading of NMS stocks will promote fair and transparent pricing across trading venues. While reducing access fee caps is a positive step, completely eliminating exchange rebates would further enhance market transparency and fairness. I also recommend accelerating the implementation of the revised round lot definition and odd lot dissemination on the SIP to improve reporting efficiency and reduce delays. In light of recent events like the GameStop controversy, it is crucial to take these steps to regain public confidence and trust in the market. Stronger enforcement, including higher fines, bigger penalties, and actual consequences, is needed to maintain market integrity. Investors are willing to support an additional 0.64 cents per share to avoid routing through a wholesaler with a history of legal issues, such as Citadel Securities (https://files.brokercheck.finra.org/firm/firm_116797.pdf). The minimal price improvement provided by these wholesalers does not justify the harm they cause to the market. Instead, investors would gladly pay a commission to avoid routing through a questionable wholesaler. Harmonization of tick sizes across all exchanges should be fully supported, with no exceptions or vague language. Clear rules and language are essential to prevent monopolistic control and to promote the positive benefits of competition. To ensure fairness, the definition of tick-constrained should apply to as much of the market as possible, with everyone trading and providing quotes according to the same rules. Rebates and other inducements in the marketplace should be eliminated, as they resemble payment for order flow. Ideally, fees should be reduced to zero, but a cap of 0.001 is acceptable. Additionally, I support the inclusion of odd-lot information in the SIP, as odd lots constitute the majority of trades and should significantly impact price and brokers' duty of best execution. Thank you for your attention to these important matters. By implementing these changes and recommendations, we can work together to foster a fair and transparent market for all participants. Best, Farris Y. Nawas, an individual investor