On June 5, Securities and Exchange Commission Chair Mary Jo White gave a speech titled “Enhancing Our Equity Market Structure” in New York. The Chair addressed the importance of strengthening the existing market structure and noted several recommendations to enhance market structure. Among the recommendations are:
- creating a new Market Structure Advisory Committee of experts to review specific initiatives and rule proposals;
- developing an anti-disruption trading rule tailored to apply to active proprietary traders in short time periods when liquidity is most vulnerable and the risk of price disruption caused by aggressive short-term trading strategies is highest;
- clarifying the status of unregistered active proprietary traders to subject them to SEC rules as dealers;
- eliminating the Financial Industry Regulatory Authority, Inc. membership exception for dealers that trade in off-exchange venues;
- improving firms’ risk management of trading algorithms and enhancing regulatory oversight over their use;
- expanding the information about alternative trading system operations submitted to the SEC and making that information publically available; and
- requiring disclosure of customer-specific information upon request by an institutional customer.
The full text of the Chair’s remarks are available here.