{"id":459776,"date":"2022-06-08T20:48:57","date_gmt":"2022-06-08T17:48:57","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/secs-gary-gensler-unveils-plan-to-overhaul-stock-trading\/"},"modified":"2022-06-08T20:48:57","modified_gmt":"2022-06-08T17:48:57","slug":"secs-gary-gensler-unveils-plan-to-overhaul-stock-trading","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/secs-gary-gensler-unveils-plan-to-overhaul-stock-trading\/","title":{"rendered":"#SEC&#8217;s Gary Gensler unveils plan to overhaul stock trading"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3cc69c1e884\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3cc69c1e884\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/secs-gary-gensler-unveils-plan-to-overhaul-stock-trading\/#%E2%80%9CSECs_Gary_Gensler_unveils_plan_to_overhaul_stock_trading%E2%80%9D\" >&#8220;SEC&#8217;s Gary Gensler unveils plan to overhaul stock trading&#8221;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9CSECs_Gary_Gensler_unveils_plan_to_overhaul_stock_trading%E2%80%9D\"><\/span>&#8220;SEC&#8217;s Gary Gensler unveils plan to overhaul stock trading&#8221;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div>\n<aside class=\"single__inline-module alignleft\">\n<\/aside>\n<p>The Securities and Exchange Commission\u2019s top boss unveiled a plan on Wednesday that he said would make sure retail traders \u2014 including those behind last year\u2019s \u201cmeme stock\u201d mania \u2014 get a fair deal.\u00a0<\/p>\n<p>The proposed changes put the SEC on a potential collision course with brokers that offer free trading like Robinhood, TD Ameritrade and E*Trade.\u00a0<\/p>\n<p>Currently, these services make money through a process called \u201cpayment for order flow,\u201d in which third-party firms like Citadel Securities and Susquehanna pay for the privilege of executing the trades themselves. The third-party firms, also known as \u201cmarket makers,\u201d then pocket the difference between the buying and selling price of a given stock or option.\u00a0<\/p>\n<p>In what would be a major overhaul of the payment for order flow system, Gensler wants to require market makers to directly compete to execute trades from retail investors to boost competition. He also said the new SEC rules would mandate market makers disclose more data around the fees these firms earn and the timing of trades for the benefit of investors.<\/p>\n<p>\u201cI asked staff to take a holistic, cross-market view of how we could update our rules and drive greater efficiencies in our equity markets, particularly for retail investors,\u201d\u00a0Gensler\u00a0told an industry audience in a speech on Wednesday.<\/p>\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-89.jpg?w=1024\" alt=\"GameStop logo\" class=\"wp-image-22578881\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-89.jpg?quality=75&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-89.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-89.jpg?quality=75&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Many investors purchased <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">Game<\/a>Stop shares using commission-free brokers such as Robinhood.<\/figcaption><figcaption><span class=\"credit\">SOPA Images\/LightRocket via Gett<\/span><\/figcaption><\/figure>\n<p>Gensler\u2019s announcement, the biggest shake-up of US equity market rules in over a decade, will likely lead to formal proposals this fall. The public can then weigh in on them ahead of an SEC vote to adopt them.<\/p>\n<p>Gensler\u2019s proposal was quickly met with pushback from a top executive at Robinhood, who argued that the current system gives enormous benefits to individual traders.\u00a0<\/p>\n<p>\u201cIt is a really good climate for retail, so to go in and muck with it right now, to me, is a little worrisome,\u201d the free trading <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>\u2019s chief legal officer, Dan Mr. Gallagher said on Wednesday,\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wsj.com\/articles\/robinhood-executive-attacks-secs-plans-to-shake-up-stock-trading-rules-11654701401\">according to the Wall Street Journal<\/a>.\u00a0<\/p>\n<aside class=\"single__inline-module alignright\">\n    <\/aside>\n<p>Payment for order flow came under regulatory scrutiny last year when an\u00a0army of retail investors\u00a0went on a buying spree of \u201cmeme stocks\u201d like GameStop and AMC, squeezing hedge funds that had shorted the shares. Many\u00a0investors purchased\u00a0shares using commission-free brokers such as Robinhood.<\/p>\n<p>The new rules would enhance order-by-order competition, including via potential \u201copen and transparent\u201d auctions, aimed at providing investors better prices. They would include an agency-specific definition of so-called best execution for equities and other securities to ensure broker-dealers and investors benefit from more detail around the procedural standards brokers must meet when handling and executing customer orders.<\/p>\n<p>They would require broker dealers and market centers to disclose more data around order execution quality to benefit investors, including a monthly summary of price improvement and other statistics,\u00a0Gensler\u00a0said.<\/p>\n<p>The rules would also seek to shrink the minimum pricing increment, or so-called tick size. to better align with off-exchange activity and harmonize the tick size to ensure all trading occurs in the minimum increment.<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-92.jpg?w=1024\" alt=\"AMC logo\" class=\"wp-image-22578912\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-92.jpg?quality=75&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-92.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/game-amc-92.jpg?quality=75&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>The new rules would enhance order-by-order competition, including via potential \u201copen and transparent\u201d auctions, aimed at providing investors better prices. <\/figcaption><figcaption><span class=\"credit\">Education Images\/Universal Image<\/span><\/figcaption><\/figure>\n<p>The proposed rule changes will include an SEC definition of \u201cbest execution\u201d requirements that would force retail brokers to send their customers\u2019 orders to auctions, run by exchanges or off-exchange trading venues, which would allow market participants to compete to trade against the orders, the sources said.<\/p>\n<p>Currently, retail brokerages can send customer orders directly to a wholesale broker to be executed, as long as the broker is matching or bettering the best price available on US exchanges. Large market-makers typically improve on the best price by a fraction of a cent.\u00a0Gensler\u00a0has\u00a0criticized this model\u00a0as limiting competition for retail orders.<\/p>\n<p>The rules would require retail brokers to send PFOF customer orders to the wholesaler offering the best deal, rather than the one that pays the most.<\/p>\n<p>This would\u00a0fundamentally alter the business model of wholesalers, which can make more money by executing retail investor orders internally than they do on public exchanges, where they might find themselves trading with other sophisticated trading firms or institutional investors.<\/p>\n<p>\u201cIt\u2019s great to see the SEC taking a holistic approach to this problem \u2014 there\u2019s not a single answer, we need changes to different parts of the market,\u201d said Dave Lauer, CEO of financial platform Urvin Finance.<\/p>\n<p>\u201cWe need an order-by-order standard for best execution and open competition for order flow in order to provide the best outcomes for retail investors. This will force greater competition, and could help to end the off-exchange oligopoly that has controlled that market for too long,\u201d he added.<\/p>\n<p>Investor advocates want to boost exchanges\u2019 competitiveness to improve the reliability of the national pricing benchmark, known as the National Best Bid and Offer.<\/p>\n<p><em>With Post wires<\/em>\n                        <\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/nypost.com\/2022\/06\/08\/secs-gary-gensler-unveils-plan-to-overhaul-stock-trading\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;SEC&#8217;s Gary Gensler unveils plan to overhaul stock trading&#8221; The Securities and Exchange Commission\u2019s top boss unveiled a plan on Wednesday that he said would make sure retail traders \u2014 including those behind last year\u2019s \u201cmeme stock\u201d mania \u2014 get a fair deal.\u00a0 The proposed changes put the SEC on a potential collision course with&#8230;<\/p>\n","protected":false},"author":1,"featured_media":459777,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2022\/06\/Gary-Gensler-87.jpg?quality=75&strip=all&w=1024","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[130078,118979,72976,70359,70360],"class_list":["post-459776","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-6-8-22","tag-gary-gensler","tag-securities-and-exchange-commission","tag-stocks","tag-wall-street"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/459776","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=459776"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/459776\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/459777"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=459776"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=459776"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=459776"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}