Securities Law Daily provides daily coverage of developments in the regulation of federal, state, and international securities and futures trading, with objective coverage of the...
Sept. 14 — The Securities and Exchange Commission's top market-structure agenda item for the rest of 2016 is finishing the consolidated audit trail, Chairman Mary Jo White said Sept. 14.
The CAT is designed to be a vast central data repository for equity orders, as provided by brokers and exchanges.
The CAT plan was formulated by the Financial Industry Regulatory Authority and national securities exchanges, and released by the SEC in April (82 SLD, 4/28/16).
The agency plans to act in the coming months on new disclosures for dark pool operators, a pilot program for lowering access fees and rebates on exchanges, and an anti-disruptive trading rule, White said at a conference of the Security Traders Association in Washington.
An anti-disruptive trading proposal won't come right away. Instead, the agency first plans to release data it has collected as it works on the topic.
“One of the most difficult tasks in developing the right regulatory response to such potentially disruptive trading strategies is the need to avoid undue interference with practices that benefit investors and market efficiency,” White said. “Clearly, this is an issue that warrants full opportunity for a well-informed, data-driven public dialogue.”
Industry stakeholders and members of the public will be able to comment on the data once released.
The data analytics likely won't be released in a formal concept release, White told reporters after her speech. For its exact format, “you’ll have to wait until it comes out,” she said.
SEC officials have said the anti-disruptive trading proposal will be the last of a slate of market-structure rules that Mary Jo White is pushing (35 SLD, 2/23/15), and attorneys told Bloomberg BNA earlier in 2016 that it would likely be the most difficult of those rules to implement (13 SLD, 1/21/16).
As envisioned by White, the rule would bar active traders from using aggressive short-term trading strategies when liquidity is at vulnerable levels and when risks of price disruption are heightened.
During pronounced volatility among Treasury markets in October 2014, principal trading firms and bank-dealers contributed greatly to an imbalance by aggressively sending buy orders, which spiked prices, White said.
“The surge in aggressive demand by these professional traders appears to have increased, rather than reduced, their exposure to the market in the direction of the price moves,” White said Sept. 14. “Such trading is troubling because it suggests a destabilizing short-term trading strategy during a period of market weakness.”
To contact the reporter on this story: Rob Tricchinelli in Washington at email@example.com
To contact the editor responsible for this story: Susan Jenkins at firstname.lastname@example.org
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)