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Since SEC Chairman Jay Clayton and Division of Trading & Markets Director Brett Redfearn took over last year, the SEC has been doing a tremendous amount of market structure work. While the tick size pilot and the proposed access fee pilot have received a lot of attention, there are other pilots that the SEC is reviewing. Earlier this year at an STA event in Chicago, Brett Redfearn said that there are currently 17 pilots being run out of the Division of Trading and Markets. He noted that there are differences in pilots: “Some of the pilots are specific to an individual exchange. Many,
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“Over the past decade, the stock exchange business has undergone a radical transformation. What was once a nonprofit, quasi-utility, member-owned duopoly has turned into a for-profit, fragmented, and extremely competitive business with 13 exchanges…Normally, if a business model opened itself to competition, this would be viewed as a good thing. It would enable free markets to work. However, the stock exchange business has more responsibilities than profit. It has to facilitate capital formation for companies and to protect individual investors. Unfortunately, the new for-profit landscape has caused the exchanges to forego these responsibilities in order to focus on the
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