Jan. 27, 2023
January 27, 2023 These rules are flawed and overly prescriptive and will do nothing to improve the market for retail traders. These will almost certainly increase the costs of trading for most retail traders. Best Ex Rule - There is already a best ex rule that all firms have to abide by. This seems like the SECs backdoor way of eliminating PFOF. Retail firms have standardized their PFOF payments across all their trading venues. They no longer are routing to the venue that pays the most for the flow, therefore there is nothing conflicted in the transactions. Lit exchanges provide horrible execution quality at the same time they hide behind their limited liability and will provide no accommodation to retail investors who receive a poor fill. If the SEC wants every execution to be on the lit exchanges and no PFOF then they should just state that. There is no way that firms can continue to provide zero commission and not accept PFOF. Does the SEC and many of the commentators really believe that firms will run provide a major part of their business like a charity? Its delusional and disingenuous for the SEC to continue to push the idea that these proposals will make trading better for retail investors. Market access is not free. The additional costs of executing orders will get passed thru to end users in some form. It is likely that retail traders will get worse executions at higher costs to transact. Order Disclosure Rule - Retail broker dealers are not all the same. The market and appeal to different type of participants. Some focus on long-term investments, while other try to cater to active day traders. How can you reasonably compare firms that by design are different. If the SEC wants to create standardized disclosures for retail firms it should attempt to segment retail investors from active retail traders. Then if a retail trader wanted to see what firm is best for them, they could make the decision based on their trading and investment objectives. These are a step backwards and I ask the commission to not adopt the proposed rules