There is not much market structure talk coming out of the U.S. Senate these days.  The two senators who did focus on market structure (Sen. Ted Kaufman and Sen. Carl Levin) are now both retired. However, there is one senator, Senator Mark Warner (D-VA), who has occasionally focused on market structure issues.  During SEC Chairman Jay Clayton’s confirmation hearing in March, Sen. Warner pressed him on the issue of rebates and the maker/taker model. Sen. Warner has said that he believes the current exchange rebate fee schedule is a way to “game the system”.  He mentioned in the confirmation hearing that he had (more…)

  We were very disappointed to read yesterday that the SEC approved Nasdaq’ Extended Life Priority Order proposal.  As you may recall, we wrote two comment letters to the SEC urging them to reject Nasdaq’s proposal.  Our main concern with Nasdaq’s ELO order was information leakage.  We detailed this in our December 19, 2016 SEC comment letter: “In return for giving retail orders queue position, Nasdaq will require that these orders be marked as extended life orders. This identifier will be disseminated to customers who purchase a proprietary data feed from Nasdaq. In other words, ELO orders will easily be identified by high frequency (more…)