Mar. 31, 2023
Dear Chairman Gensler, I am writing to express my strong support for the proposed changes to Regulation Best Execution, as outlined in File No. S7-32-22; Release No. 34-96496. As an individual investor, I believe that the SEC has a responsibility to reduce conflicts of interest and increase transparency in the routing of orders by brokers and wholesalers. The proposed changes to ATS rules would be beneficial for individual household investors, as they would promote better alignment with regulatory frameworks for exchanges. I believe that 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. Furthermore, I believe that ATS should establish and enforce written policies and procedures to prevent fraudulent and manipulative practices. This would help to protect individual investors from abusive practices in the ATS market. It is also important that ATS 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. Additionally, I believe that ATS should operate in a manner that is consistent with the broader regulatory structure of the securities markets, which would benefit individual investors by promoting fair and transparent trading practices. The proposal to implement a variable minimum pricing increment model for both quoting and trading of NMS stocks would promote fair pricing across trading venues, which is essential for ensuring a level playing field for all investors. It is also important that competition in the marketplace is necessary to regulate markets better and barriers to competition, such as the conflicted nature of PFOF, should be removed. The SEC should prioritise creating a competitive market structure that benefits investors and encourages transparency. Lastly, I support the proposed cap on commissions or fees in lieu of PFOF, as it would provide investors with more options to avoid being routed to a wholesaler for internalisation. Moreover, estimated savings for retail investors range from $1.12 billion to $2.35 billion, primarily through increased competition to supply liquidity to marketable orders. In conclusion, I urge the SEC to implement the proposed changes to Regulation Best Execution in order to reduce conflicts of interest, promote transparency, and enhance competition in the marketplace. Thank you for your consideration. Sincerely, Mr David Daumas