Mar. 31, 2023
Dear SEC, As a concerned investor, I believe that the SEC should reduce conflicts of interest by increasing transparency in the routing of orders by brokers and wholesalers. Investors should have access to the best priced quotations available in the NMS to ensure fair and transparent pricing across trading venues. The proposed changes to ATS rules promote better alignment with regulatory frameworks for exchanges and would be beneficial for individual household investors. To promote greater transparency, ATS should submit detailed disclosures about their operations, including how they manage conflicts of interest, how they operate their order routing practices, and how they handle customer orders. This would make it easier for investors to understand how ATS operate and how their orders are executed. ATS should also establish and enforce written policies and procedures to prevent fraudulent and manipulative practices, protecting individual investors from abusive practices in the ATS market. Furthermore, ATS should provide detailed information about the operation of their systems to the SEC, including data on the execution of orders, order routing practices, and information about the use of dark pools. This would improve the SEC's ability to oversee ATS and ensure compliance with regulatory requirements. ATS should operate in a manner that is consistent with the broader regulatory structure of the securities markets, promoting fair and transparent trading practices. I support the implementation of a variable minimum pricing increment model for both quoting and trading of NMS stocks, which would promote fair pricing across trading venues, ensuring a level playing field for all investors. This would further promote fair and transparent pricing across trading venues, ultimately benefiting investors. Household investors support any initiatives aimed at identifying and preventing fraudulent practices that undermine the credibility, integrity, and functionality of American markets. Sending orders to a wholesaler for internalization should not be the only option available to investors. Brokers may charge high commissions or fees in lieu of PFOF, so a cap should be implemented. Removing the conflicted nature of PFOF would promote greater competition in the marketplace, ultimately benefiting investors. Estimated savings for retail investors range from $1.12 billion to $2.35 billion, primarily through increased competition to supply liquidity to marketable orders. Competition in the marketplace is necessary to regulate markets better and barriers to competition, such as the conflicted nature of PFOF, should be removed. In conclusion, the SEC should prioritize creating a competitive market structure that benefits investors and encourages transparency. By taking the necessary steps to reduce conflicts of interest, increase transparency, and promote fair and transparent trading practices, the SEC can help create a level playing field for all investors. Sincerely, A Scorned Day Trader